AI Drives Two-Way Shift in China’s Labor Market, Survey
Artificial intelligence is reshaping China’s labor market in two opposing directions at once — creating a surge in demand for technical talent while simultaneously eroding hiring in roles vulnerable to automation, according to a new survey by Zhaopin, one of the country’s largest online recruitment platforms.
Li Qiang, vice president of Zhaopin, told Caixin Global that platform data shows AI-related hiring has climbed sharply since the release of ChatGPT in the fourth quarter of 2022, while job openings in editing, customer service, and visual-interaction roles have contracted. “Artificial intelligence is reshaping the Chinese mainland’s labor market in two directions at once,” Li said, “creating demand for new technical and product roles while eroding hiring in jobs that can be partly automated.”
The Scale of the Shift
The magnitude of the transformation is striking. AI-related job postings in China jumped approximately 12-fold year-on-year in the first two months of 2026, making up 26.23% of all “new-economy” job listings — up from just 2.29% a year earlier, according to a Maimai report cited by Tech in Asia. This growth far outpaced other new-economy sectors such as healthcare, renewable energy, and semiconductors.
Yet the supply of qualified talent is severely constrained. The supply-to-demand ratio for high-performance computing engineers stands at just 0.15, meaning roughly seven vacancies exist for each available candidate. Critical shortages also exist for SLAM algorithm creators, regulatory control algorithm engineers, and cloud computing specialists, as reported by China Strategy.
Salaries reflect this scarcity. Zhaopin reports that AI engineers earn an average monthly salary of 20,804 yuan (approximately US$3,020), the highest among tech jobs — above chip engineers, mobile developers, and software engineers. Major companies are racing to secure talent: Ant Group announced that over 70% of its technical roles in the 2026 spring campus recruitment will focus on AI.
The Other Side of the Coin
While AI hiring booms, the picture is far less optimistic for workers in roles susceptible to automation. A 2023 study by the Central University of Finance and Economics estimated that 54% of jobs in China are at high risk of substitution, according to The Wire China. A separate 2020 study by Peking University and Renmin University projected that AI could displace up to 278 million Chinese workers by 2049 — roughly one-third of the current workforce.
Li Lixing, a professor at Peking University’s National School of Development who analyzed millions of job postings from 2018 to 2024, found a clear decline in vacancies for occupations with “high exposure to AI.” Most at risk are knowledge-based workers in professions involving text and data processing — including accountants, editors, and programmers. “Some of the job positions in such occupations are being replaced by AI, so that firms could cut new hiring,” Li told The Wire China. “AI will lead to a net loss of full-time, formal job positions.”
A Structural Contradiction
China’s labor market faces what the government itself has acknowledged as a “structural contradiction” — a situation where there are simultaneously “jobs without workers and workers without jobs.” The country is short of an estimated 5 million AI talents, according to the National Development and Reform Commission, even as millions of workers face displacement from traditional roles.
This tension is compounded by demographic pressures. China will see 12.7 million university graduates in 2026 — nearly three times that of the United States — while youth unemployment (ages 16-24) stood at 16.9% in November 2025, staying persistently high amid slowing economic growth. Over 200 million workers have already entered the gig economy, characterized by low pay and high labor intensity.
Sun Zhongwei, a professor at South China Normal University who studies labor markets, captured the central challenge: “AI may substitute some jobs, but it will also create new ones. The key is whether the upgrading of our workforce — improving its quality and transforming people’s skill sets — can keep pace with the technological changes.”
Courts Push Back
In a significant legal development, a Hangzhou court ruled in May 2026 that a tech company illegally dismissed an employee after replacing his position with AI — the third such ruling in China. The court stated that “AI technology applications aim to liberate labor, improve efficiency, and benefit people’s livelihoods,” but added that while labor law allows employers to undergo technological transformation, they “must also protect workers’ legitimate rights and interests.”
Matt Sheehan, a senior fellow at the Carnegie Endowment for International Peace, described the deeper contradiction facing Beijing: “On one hand, pushing AI to penetrate the real economy, while on the other hand, not wanting this technology to actually impact any jobs,” he told the New York Times.
The Balancing Act Ahead
China’s leadership faces a delicate tradeoff. The government is heavily invested in AI as a strategic priority for competing with the United States and addressing demographic challenges. Moody’s has estimated that generative AI could lift productivity by about 1.5% per year in adopting economies. But the social costs of rapid automation are significant.
Osea Giuntella, an associate professor of economics at the University of Pittsburgh, framed the challenge succinctly: “The tradeoff that the Chinese government will face is how to encourage investment in AI to compete with other global powers, but at the same time, protect the workforce, including providing a safety net to those who may fall through the cracks.”
China’s State Council acknowledged the challenge in August 2025, calling for measures to help people transition into new roles. The Ministry of Human Resources and Social Security announced in January 2026 that it would develop policies addressing “AI impact on employment.” Some officials have proposed government-led “AI unemployment insurance,” while a Xinhua editorial in March urged companies to use AI to create new roles rather than simply cut jobs.
Weize Huang, an associate professor at Xi’an Jiaotong-Liverpool University, offered a cautiously optimistic perspective: “Historical experience from previous waves of technological innovation shows that when productivity rises, new tasks, jobs, occupations, and industries tend to emerge at the same time. Demand continues to grow for AI-related positions such as data analysts, algorithm maintenance engineers, and digital supply chain managers.”
The question that remains unanswered is whether China can retrain millions of workers fast enough to keep pace with the technological transformation it is actively accelerating — a challenge with no easy solution and profound implications for the world’s second-largest economy.