China turns to automation to solve population problems – fr

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China turns to automation to solve population problems – fr


GUANGZHOU, China – Qin Jiahao has worked in the logistics operations of Chinese e-commerce giant JD.com for about six years. Today, much of his work has become automated.
“In the past, almost all of the work was manual. After automation, almost half of our workers’ work is done by machine. It reduces our work intensity, ”Qin told CNBC.

“In the past, I was responsible for collecting the goods and putting them on shelves… Now, once the goods arrive here, the automation equipment will put them in a designated place and then put them on shelves. . The whole process is finished. by automation. “

As you walk through JD.com’s 500,000 square meter logistics park in Dongguan, southern China, you will see huge machines helping automate tasks such as packaging and shelving.

Qin’s situation highlights a larger trend in China – the push towards job automation. The labor market of the world’s second-largest economy faces major challenges, including an aging population and rising wages.

“Population aging is still a rapidly changing reality… China now faces the challenge of potentially getting old before it gets rich,” Jonathan Woetzel, senior partner at McKinsey, told CNBC.

An automated machine stacks packages at the huge logistics center of Chinese e-commerce giant JD.com in Dongguan, China.
Arjun Kharpal | CNBC
China’s working-age population has shrunk by more than 5 million people over the past decade as births have fallen, according to the country’s National Bureau of Statistics. The country is still feeling the effects of the one-child policy adopted in the late 1970s to control its rapidly growing population.
Between the 1940s and 1980s, the country’s population doubled in size, from over 500 million people to over 1 billion, according to official figures. Over the next 40 years, this growth slowed to 40%. Today, the country’s population is 1.4 billion – more than four times the size of the United States

However, the proportion of the Chinese population of working age is declining.

Automation is seen as one way to help solve some of these problems.

“Automation, of course, is one of those great opportunities,” Woetzel said. “And by that, we include digitization, both for the customer, and more importantly… up the chain to the suppliers. It’s really going to be the engine of increasing all of that productivity. “

“In the financial industry, about 10 years ago, if you looked at the average productivity of a financial worker in China, compared to Europe, say, it was maybe 20%. Now it’s closer to 40%, or 50%. , but to have that degree of change, over the course of almost… five years is almost unheard of. ”

Driverless car push

But automation goes beyond the obvious places like factories or warehouses.

China is advancing technologies like driverless cars that use artificial intelligence, an area Beijing hopes to dominate in its broader tech battle with the United States.

The city of Guangzhou in southern China has emerged as a major testing center for autonomous vehicles. A start-up called WeRide is developing technology for driverless cars and buses.

WeRide’s autonomous robobus is parked at the company’s headquarters in Guangzhou, China.

Arjun Kharpal | CNBC

Autonomous vehicles could replace jobs such as taxi drivers. Tony Han, CEO of WeRide, sees self-driving cars as a way to solve some of the problems associated with an aging population.

“One (of the problems) is the labor shortage, especially in the concept of an aging society. In China, and also in the United States, in most of… developed countries, human labor is becoming more and more expensive. People need better wages, need more social assistance, ”Han said.

“Think if you want to have a driver, you want to have a driver, it’s quite expensive and sometimes to call a taxi in a more metropolitan city… also quite expensive. Can we find a cost effective way to provide this type of transportation service to everyone? ”

Job displacement

However, increasing automation could also lead to job losses.

Between 2018 and 2030, up to 220 million Chinese workers, or 30% of the workforce, may need to transition between occupations, McKinsey estimates.

“This is, of course, a huge challenge for the employer, but also for the employee, but also for the government and for society as a whole,” Woetzel said.

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