Will ChatGPT and similar generative AI tools worsen China’s job crisis? Country’s employment landscape faces sweeping disruption

Generative AI technology is bringing sweeping disruptions to certain traditional occupations in China and the country’s broader job market
The stakes appear high in China, where low birth rates have combined with a rapidly ageing population to result in a widening demographic imbalance

Artificial intelligence

Coco Fengin Beijing

Published: 11:00am, 18 Jun 2023

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In the southwestern tech hub of Chengdu, capital of Sichuan province, Matthew Chen co-founded a small video gaming studio and publisher that has recently embraced generative artificial intelligence (AI) technology to become more efficient, while vastly reducing its manpower requirements – an emerging trend in the world’s second-largest economy.

By adopting two foreign-developed tools – Stable Diffusion, a deep-learning system that generates detailed images based on text descriptions, and AI chatbot ChatGPT – which are both officially not available in China, Chen’s company has done away this year with an army of contractors who used to do translation work.

“ChatGPT translates much faster, and it costs only US$20 a month,” Chen said. By comparison, a third-party translation firm can charge as much as 100,000 yuan (US$14,000) for a year’s contract, he said.

Copywriters, foreign-language customer service employees and some illustrators can also be replaced by AI, according to Chen. He said his company is experimenting with Stable Diffusion, which turns text prompts into images, to make rough sketches into images. This system can be about 80 per cent as good as a human illustrator, he said.

The changes made at Chen’s video gaming studio represent a small fraction of the sweeping disruptions brought by generative AI technology to certain traditional occupations in China and the country’s broader job market.

In a global analysis published in late March, Goldman Sachs estimated that generative AI could automate as many as 300 million full-time jobs.

The US investment bank found that one-quarter of current tasks could be automated by AI in the US and Europe, listing sectors such as office administrative support, legal, architecture and engineering.

The stakes appear higher in China, where low birth rates have combined with a rapidly ageing population to result in a widening demographic imbalance. This situation has also been complicated by the country’s record-high youth unemployment rate.

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There are 11.6 million new university graduates this summer, some 820,000 more than last year, who will enter China’s job market, which is already awash with unsuccessful jobseekers who finished college during the coronavirus pandemic.

A recent study conducted by Zhang Dandan, an associate professor at Peking University’s National Development School, on 1.2 million job posts in a Chinese recruitment website found that employment opportunities are quickly disappearing for positions that can be easily replaced by AI, including in sales, accounting, training, software development, office management and client services, according to a report by Shanghai-based digital media outlet Jiemian.

The study suggested that AI is taking away more traditional occupations in China than creating new jobs, which is a trend that may intensify, Zhang was quoted by Jiemian as saying. She shared her research at an academic symposium last month in the nation’s capital.

While the Chinese government has yet to provide an estimate of the overall AI-related disruptions in the country’s job market, the technology’s impact is becoming more pronounced. One of the hardest-hit sectors is overseas study agency, in which intermediaries prepare the relevant paperwork for overseas study applications, according to a recent report by state-controlled National Business Daily, which said ChatGPT was killing this trade.

ChatGPT boss says AI won’t spark mass jobs extinction

The report quoted Zhang Ye, who runs a firm that assists Chinese students to study overseas, as saying that his company has already lost more than 60 per cent of its business in “polishing” applications to “high-quality” work done via ChatGPT.

Using a large language model (LLM) like GPT-4, the latest version developed by US start-up OpenAI for its ChatGPT service, also costs less than 1 per cent of hiring a human data analyst while turning in comparable performances, according to a recent study by Damo Academy, the in-house research arm of Chinese e-commerce giant Alibaba Group Holding, and Singapore’s Nanyang Technological University. Alibaba owns the South China Morning Post.

An LLM is a deep-learning algorithm that can recognise, summarise, translate, predict and generate text and other content based on knowledge gained from massive data sets.

At present, China’s government is yet to officially approve any domestic ChatGPT-style services. Baidu’s Ernie Bot, SenseTime’s SenseChat, iFlytek’s SparkDesk and Alibaba’s Tongyi Qianwen are all considered in “trial mode”. Both ChatGPT and Google’s Bard, meanwhile, are not directly available in China, which has the world’s largest internet population.

AI sector a bright spot in tough jobs market for China’s graduates

Still, tech-savvy Chinese users have used ChatGPT in various local endeavours.

A social sciences researcher and college professor, surnamed Zhang, described ChatGPT as being “very reliable” in his data analysis for R, a programming language for statistical computing and graphics, and the general-purpose Python programming language.

“I used to spend 20 to 30 per cent of my time on assignments” such as composing course syllabuses, drafting speech scripts for faculty deans and writing meeting agendas, Zhang said. “ChatGPT is pretty good at generating content that doesn’t have to contain arguments or originality, but it won’t turn out an avant-garde academic paper.”

There are also certain enterprises and industries that have widely adopted these new AI tools and created new job opportunities.

Copywriters, designers, illustrators and translators can also use generative AI to improve their work and not necessarily be replaced, according to Pascale Fung, director of the Centre for Artificial Intelligence Research at the Hong Kong University of Science and Technology.

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Is China’s technology falling behind in the race for its own ChatGPT?

“Jobs that are likely to be created are those that use AI to improve their efficiency and creativity,” Fung said. “There will be a new generation of AI designers, content creators, analysts, architects, artists and more who know how to harvest the power of generative AI.”

On Boss Zhipin, a Chinese recruiting platform that targets tech workers, at least 27 vacancies were listed this week for “prompt engineers”, a relatively new role to optimise the interaction with generative AI.

Employers included some of China’s biggest internet firms, including TikTok owner ByteDance, voice recognition giant iFlytek and Jidu, an electric car venture backed by Baidu and carmaker Geely. Hangzhou-based intelligent marketing agency Mogic is also looking for about five prompt engineers, which are new positions created in May, according to a company representative in charge of technology in a written response to the Post.

A prompt engineer is expected to have comprehensive capabilities to understand LLMs, write code, analyse data and know marketing. “For example, the prompt engineer has to understand how a short video works to ask generative AI to provide the right scripts,” the Mogic representative said.

Even for China’s fresh graduates, those with degrees related to LLMs are in short supply, as the number of job openings surged 172.5 per cent from a year earlier, according to job search platform Liepin’s 2023 employment report for Chinese university graduates.