“The development of full artificial intelligence could spell the end of the human race” says Stephen Hawking, a significant figure in the field of Cosmology, Artificial Intelligence (AI) and theoretical physics (Cellan-Jones, 2014, para 1). But today in the modern AI world which is mostly known by many, as the fourth industrial revolution, the AI researchers refute and under-value Stephen Hawkings intimidating predictions. They keep themselves blind over the facts that AI brings forth more threats than benefits to individuals and societies. According to Rouse (2019), Artificial intelligence (AI) is the simulation of human intelligence processes by machines, especially computer systems. These processes include learning, reasoning and self-correction (para.1). This essay’s main concern goes on how an increase involvement of AI will impact individuals, organizations, and labor workforce in China. The problems which AI carries with itself in China are, increased rate of unemployment and immeasurable amount of funds being continuously invested in it. It will also look forward to different solutions to tackle these problems, including government providing subsidies to unemployed people and upgrading the educational system in China in order to confront the rapid technological changes. And in the end, it evaluates these solutions and finds one highly recommended solution.
AI is now rapidly changing the face of businesses and multinational organizations in more than 75 developed countries including China, which is currently the second country after United States leading in AI development (citation). International Monetary Fund reports that ‘Asia holds 65% of the worldwide responsibility for employing manufacturing robots where China accounts for 50% of Asia’s total industrial robot usage’ (Danmeng & Jia, 2018, para.5). China is already facing unemployment problems with over ‘50 million citizens currently unemployed’ (Trading Economics, 2019), mainly due to its enormous population with highest population rate of ‘1.393 billion people’ (Countryeconomy, 2018, para.1), and it is estimated to reach up to ‘1.433 billion people by the end of 2019’ (WorldOMeters, 2019, para.1). China is currently one of the countries, with most foreign Multi-National Company (MNC’s) factories running in it due to its inexpensive land, therefore, MNC companies with enormous funds adds more profit by minimizing their cost of production by replacing labors with robots. Apple Inc. in Eastern China has found that ‘Autonomous machines in China costs 130,000 yen per year ($19,000) which is equivalent to the cost of multiple workers doing the same job within a shorter amount of time’ (Danmeng & Jia, 2018, para.5). CEIC (2019) estimated that “On average, the monthly income of a middle-class citizen in China stands around US$330.” In addition, CEIC (2019) also reports that “China’s Labor Force Participation dropped to 68.72% by December 2018.” Due to an unpleasant wage rate and unfair work pressure, Chinese labors passion for work also disappears every year, making them directly dependent on Chinese government for financial Aids. As result of poor wage given to employees and firms maximization of profit by replacing human workforce with automated machines, the nuisance of unemployment continues to grow with an unstoppable rate.
AI bring forward multiple barriers and problems with its daily upgradation and improvement which mainly includes high unemployment rate and lofty cost of starting AI firms. Firstly, Danmeng and Jia (2018, para.4) states that “30-40% of the labors has been replaced with AI machines over the past three years”; their research makes it very specific that every year China has been witnessing an immense decline in unemployment rate with advanced AI. According to Ren (2018), 2.3 million employees working in industrial sector are either going to lose their jobs or more than half of them will be reassigned to new jobs before 2027 due to disruptive AI technologies. (para.1). “Chinese scholars and psychologists treat the situations of unemployed people as Post-Traumatic Stress Disorder (PSTD)” (Yang, 2019, para.3). This extreme downward unemployment rate has brought up significant consequences which includes rage, stress and depression due to poverty amongst unemployed. Yang (2019) also points out that social anger and unrest are also some of the emotional problems caused due to unemployment (para.2). Additionally, Yang (2019) also states that besides psychological suffering, unemployment has also been responsible for many physical problems like headaches, stomach ache and hair loss (para.3). Unemployment holds the middle and low-class citizens of China in a severe health condition which also decreases the nations productivity growth.
Secondly, China must be aware of the exorbitant amount of money invested in AI firms which effects the economy of China directly and indirectly. According to Barhat (2018) “Investors poured $4.2 billion into more than 200 Chinese A.I. companies between 2012 and 2017” (para.1). Following this, Barhat (2018) also reports that, an addition of $1 trillion is going to be invested to build and upgrade their AI industry within the next 30 years. Chinese investors are on a constant run in the flight for the latest technology in AI industry, with apparently more than $1.42 trillion invested and to be invested funds, which leads to more imbalance in their economy, which then leads to corruption and deceit amongst government heads. According to Distinguished Fellow and & Adjunct Professor at Carnegie Mellon University’s College of Engineering, Vivek Wadhwa, ‘Governments can’t make innovation by throwing money at AI firms, this will only lead to more corruption and bureaucracy’ (Barhat, 2018, para.11). Therefore, investing boundless amount of money in AI can easily destroy an economy of a nation by bringing almost irreversible imbalance in high, middle and low-class citizens of China.
There are limited solutions available to be addressed in order to tackle with the problem of AI related unemployment. Governments and Ministry of Education plays an important role in introducing new laws and policies as a solution to fight against this consequence in China. Firstly, government can start providing subsidies like UBI Policy and introduce more public jobs. Subsidies should be provided by the government to the unemployed in order to motivate them to start working again. According to Arthur (2016), “Universal Basic Income (UBI) is a payment made to all adult individuals that allows people to meet their basic needs. It is made without any work or activity test” (para.1). Government can introduce the UBI policy in China to improve the financial status of the middle and low-class citizens for a reasonably short-term. This policy encourages the citizens to get their self-esteem back and motivate them to start working again. “UBI takes the weight off the unemployed citizens shoulders by ensuring that everyone has enough money in their pocket for survival and also helps to keep money flowing through the economy, particularly after tens of millions of jobs have been disappeared” (Stollery, 2018, para.12). The Chinese government can also start providing public jobs to the unemployed to decrease unemployment rate. According to CompTIA (2019), “U.S. economy added 75,000 jobs in May 2019” (para.10). China can launch public organizations to promote and employ low-class citizens in public job for their survival and to balance the nation’s economic too.
Secondly, China’s Ministry of Education can directly bring an impact on the future of work by confronting present students with rapid and immense technological changes. According to McKinsey Global Institute report ‘around 40 to 160 million women worldwide may need to change their profession by 2030, which will often be replaced by high-skilled roles’ (Press, 2019, para.3). Most of the occupations which requires least qualifications are evidently getting and going to be replaced with AI robots and other automated machines. This predicted situation then leaves behind only those jobs which demands higher skills and talents. CompTIA (2019) state that over 89900 software and application developers, 25000 computer user support specialists, 22100 computer systems engineers and architects, 20100 computer system analysts and 17600 IT project managers were required by companies worldwide only during the month of May 2019 (para.11). Therefore, Ministry of Education can adapt present students with future intense technological competition by increasing the education level in schools and colleges through upgrading educational systems and hiring highly qualified teachers and mentors.
Artificial Intelligence has been increasingly developed since 2010 with the aim of bringing ease in work industry with both pros and cons attached to the idea from every aspect of life. Evidently, AI’s effect on future of work, is a very broad and complex situation which undoubtedly requires multiple approaches by governments and ministries in order to minimize its negative impacts on both individuals and society. Firstly, implementation of subsidy policy by government would be a financial support to unemployed people in short run. According to Brown (2015), many countries like Australia, Austria, France, Germany, Poland Sweden and UK has been witnessing the success of subsidy programs implemented (para.7). However, this approach requires huge amount of funds for a long period of time to aid 2.3 million unemployed low-class citizens, which can lead to economic imbalance or it can even crash China’s economy in worst case scenarios. Furthermore, it also increase laziness and procrastination to those who are not willing to work but are still applicable to access governmental subsidies due to their unemployment status. Secondly, Chinese government can provide numerous public sector jobs to their below average class citizens. This opportunity keeps them busy with work and helps them earn adequate income for living and covering their daily expense for survival. In addition to that, Caponi (2017) state that, increasing public sector jobs also assists in decreasing the unemployment rate (para.1). Regardless of work opportunities and adequate income, public jobs can lead to loss of creativity and poor IQ among below average class people, which leaves them far behind from the daily necessary education. Additionally, Caponi (2017) reported that, by promoting and offering more public jobs, overall productivity of an economy can face a downward trend. Lastly, Ministry of Education can have an impact directly on current and future consequences with AI related work by increasing the level of education in high schools and colleges. C. Yi, a professor at the Tianjin University of Finance and Economics reports that Ministry of Education must reform China’s education system that will be able to train students to develop skills needed in the future and adapt themselves to new AI based jobs (Global Times, 2018, para.18). This initiative taken by ministry of education brings multiple advantages. One of the advantages of upgrading educational system is that it leads to an increase in creativity. This initiative can also bring down the unemployment rate significantly, which then supports nations economic growth on a long run. On the other hand, this process will be time consuming and requires huge amounts of funds. All the different solutions emphasized has positive as well as negative outcomes. However, the best course of action would be initiatives to be taken by ministry of education like increasing education level in secondary and high schools to prepare students for rapid technological changes. Evidently, Ministry of Education plays a significant role in challenging the upcoming consequences of AI in the near coming future.
To conclude, Artificial Intelligence and its effect on future of work is a huge, and entirely complex concern which will bring a vast change to the future of work. AI’s growth can have a massive negative impact on individuals and societies in China, which includes high unemployment rate and lofty amount of money invested in AI companies manufacturing process. This essay suggests three overall solutions which includes introduction of subsidy policy, addition of public jobs in the economy by the government and upgradation of educational system by ministry of education. After evaluating these solutions, it highly recommends that ministry of education must change educational system not only because it confronts students with rapid technological changes, but it also increases young peers’ creativity. This also helps economy grow in the long term by minimizing the unemployment rate in the future.
- Arthur, D. (2016). Basic income: a radical idea enters the mainstream. Retrieved from https://www.aph.gov.au/About_Parliament/Parliamentary_Departments/Parliamentary_Library/pubs/rp/rp1617/BasicIncome
- Barhat, V. (2018). China is determined to steal A.I. crown from US and nothing, not even a trade war, wil stop it. Retrieved from https://www.cnbc.com/2018/05/04/china-aims-to-steal-us-a-i-crown-and-not-even-trade-war-will-stop-it.html
- Brown, A. (2015). Can hiring subsidies benefit the unemployed?. Retrieved from https://wol.iza.org/articles/can-hiring-subsidies-benefit-unemployed/long
- Caponi, V. (2017). The effects of public sector employment on the economy. Retrieved from https://wol.iza.org/articles/effects-of-public-sector-employment-on-economy/long
- CEIC. (2019). China Unemployment Rate. Retrieved from https://www.ceicdata.com/en/indicator/china/unemployment-rate
- Cellan-Jones, R. (2014). Stephen Hawking warns artificial intelligence could end mankind. Retrieved from https://www.bbc.com/news/technology-30290540
- CompTIA. (2019). US Tech Unemployment Rate at Record Low, CompTIA Analysis Reveals. Retrieved from https://www.prnewswire.com/news-releases/us-tech-unemployment-rate-at-record-low-comptia-analysis-reveals-300863947.html
- Countryeconomy. (2018). China – Population. Retrieved from https://countryeconomy.com/demography/population/china
- Danmeng, M. & Jia, D. (2018). AI May Worsen Structural Unemployment in China: Report. Retrieved from https://www.caixinglobal.com/2018-08-30/ai-may-worsen-structural-unemployment-in-china-report-101320259.html
- Global Times. (2018). AI to affect 70% of occupations as robotics complement China’s shrinking labor force. Retrieved from http://en.people.cn/n3/2018/0917/c90000-9500920.html
- Press, G. (2019). Is AI Going To Be A Jobs Killer? New Reports About The Future Of Work. Retrieved from https://www.forbes.com/sites/gilpress/2019/07/15/is-ai-going-to-be-a-jobs-killer-new-reports-about-the-future-of-work/#61f6294cafb2
- Ren, D. (2018). 2.3 million – the number of jobs that could be lost to artificial intelligence in China’s financial sectors by 2027. Retrieved from https://www.scmp.com/business/companies/article/2139685/23-million-number-jobs-could-be-lost-artificial-intelligence
- Rouse, M. (2019). AI (artificial intelligence). Retrieved from https://searchenterpriseai.techtarget.com/definition/AI-Artificial-Intelligence
- Stollery, B. (2018). Universal Basic Income is an inevitable part of our automated future. Retrieved from https://medium.com/age-of-awareness/universal-basic-income-is-an-inevitable-part-of-our-automated-future-3cc181d4778d
- Trading Economics. (2019). China Unemployment Rate. Retrieved from https://tradingeconomics.com/china/unemployment-rate
- WorldOMeters. (2019). China Population. Retrieved from https://www.worldometers.info/world-population/china-population
- Yang, G. (2019). Unemployment and mental health in China. Retrieved from https://theasiadialogue.com/2019/04/15/unemployment-and-mental-health-in-china/