Automation is coming, sooner rather than later—and China should welcome it. But creative policies will be needed, from government and companies, to help individuals adapt.
The rise of modern China is the most consequential story of our times, and in some ways the most hopeful one. More than 700 million people have climbed out of poverty over the past four decades, and China is now the world’s second-largest economy. The country has probably experienced more change at a greater scale over this period than at any other in its history, even as it has projected itself onto the world with more effect than ever before.
Clearly, policies from the top were crucial to this positive outcome. The government created incentives for the domestic economy, and also encouraged foreign investment. China’s entrepreneurs and workers then converted these policies into an economic transformation that overcame enormous challenges even as it generated unprecedented prosperity. Their adaptability, flair, and willingness to take risks created today’s China.
Today China and the world are facing another epochal transition. In little more than a decade, according to scenarios prepared by the McKinsey Global Institute, accelerating advances in digitization, automation and artificial intelligence could displace hundreds of millions of jobs, even as they create new ones. Unprecedented numbers of mid-career workers will quickly need to learn new skills in order to remain in the workforce.
In this context it is important that China, which very much needs the productivity gains that adopting these technologies can bring, begins now to explore, debate and rethink what will be required—from individuals, business, and government—to successfully manage this next phase in its evolution. This paper covers the following topics:
§ Section 1 takes a global view of the impact of technology on the future of work between now and 2030 and underscores the need for large-scale retraining efforts.
§ Section 2 explores the likely impact of these forces on China, including the case for even faster adoption of automation as the country ages.
§ Section 3 briefly examines the shortcomings in China’s current education and training systems.
§ Section 4 sets out recommendations for meeting this challenge in three areas: establishing a national Reskill and Retrain Committee; boosting industry and education partnerships to support workforce transitions; and scaling up digital initiatives and competency-based learning.