By 2025, machinery and robotics are set to replace nearly 5% of China’s workforce, leading to the disappearance of certain jobs and more pressure on the job market, according to an industry report released this week.

In a survey of nearly 2,000 companies in China, the Wuhan University Institute of Quality Development Strategy found that the proportion of workers employed in companies that made use of robotics rose from 12% in 2008 to 37% in 2017.

Of the companies surveyed, 13.4% used robots as part of their processes in 2017, up from 8.1% two years before.

As a result, about 40% of China’s manufacturing workforce could be “potentially affected” by the use of robots, putting further strain on the job market on the world’s most populous country, according to the report.

Between 2015 and 2017, the average annual growth rate of investments in robotics was as high as 57%. The rise of automation had a disproportionate impact on workers with lower levels of education - during this period, robotics replaced 9.4% of employees with a junior high school degree or below, while demand for college degree workers conversely grew 3.6%.

China has become a world leader in automation in recent years, becoming the largest buyer of industrial robots in 2013. The country’s “Made in China 2025” national campaign, announced in 2017, also put smart manufacturing as a high priority.

The country aims to make it into the world’s top 10 most intensively automated nations by 2020, with a target of 150 robot units per 10,000 employees. According to an IDC report, the country’s annual spending on robotics is likely to exceed US$59bil by next year.

Last year, about 154,000 industrial robot units were installed in China - 36% of all units installed globally - according to the International Federation of Robotics.

But along with potential economic benefits, the rise of automation has also brought uncertainty to the future of about 100 million workers employed in the manufacturing industry: a separate survey by government think-tank China Development Research Foundation and venture capital fund Sequoia China last year showed that some companies in China’s export-manufacturing provinces of Zhejiang, Jiangsu and Guangdong had cut 30% to 40% of their labour force between 2015 and 2017 due to automation.

Still, in spite of the ongoing US-China trade war and the increasing automation of processes previously carried out by human workers, the Wuhan institute expects China’s overall employment rate to grow 1.6% in 2020.

 - SCMP