Chinese companies have quietly cut the number of contract employees and slowed recruitment of new graduates since March 2026 while adopting AI tools such as OpenClaw to automate workflows [1, 2, 3]. Many tasks once performed by staff are now replaceable by AI, as a contract employee in Hangzhou said, "A majority of work tasks can be fully replaced by OpenClaw. Once someone automates all workflows in OpenClaw… they basically can be dismissed" [1].
Large tech firms are restructuring, replacing marketing and front-end roles with AI-powered automation [1, 2, 3]. Alibaba’s AI platform "Wukong" promotes automation that can replace entire departments in ecommerce, live streaming, and software development [1, 2, 3]. A cloud engineer there said staff reductions are happening gradually through attrition rather than mass layoffs [1, 2, 3].
Companies began measuring employee AI usage by token consumption in March 2026, linking it to performance rankings and promotions [1, 2, 3]. But some experts warn this metric is losing favor without a clear AI ROI standard [4]. A big data engineer said, "People should not use AI for the sake of AI. I can't shake the feeling I'm closer to being replaced" [3].
China’s government encourages rapid AI adoption to boost productivity but discourages large layoffs to maintain social stability [1, 2, 3]. A financial tech executive said, "Private firms must tolerate some efficiency losses to avoid mass layoffs, which might trigger ‘social instability’ and political effects" [2]. Labor law requires approval if layoffs exceed 10% and courts have ruled AI use alone is insufficient grounds for dismissal [1, 2, 3].
The entertainment industry has seen the sharpest impact, with AI-generated actors and scenes reducing production team sizes by about two-thirds [1, 2, 3]. In February 2026, a short drama production team shrank from 30-40 people to about 10, with only two involved in live shooting [1, 2, 3]. A young short drama producer said, "Even small roles with a few lines in live shoots pay actors thousands of yuan a day" [2].
Despite a 74% growth in AI-related job openings in 2025, entry-level jobs for 12.7 million new graduates declined amid the overall shift [1, 2, 3]. Citi Bank estimates about 9.6% of Chinese jobs, roughly 70 million, face high AI replacement risk, rising to 13.6% risk for workers in their 20s [1, 2, 3]. AI anxiety is a widespread topic on Chinese social media, with discussions garnering over 7.8 million views [1, 2, 3].
Beijing’s AI+ plan targets 70% AI adoption in key industries by 2027 and 90% by 2030, expecting transitional job losses along the way [1, 2, 3]. Analysts believe the productivity gains will reduce hiring demand, but large companies will remain cautious about mass layoffs[何淑静, s1].
Official media in China state AI will not take away jobs and continue studying impacts with retraining plans yet to be launched [1, 2, 3]. Social policy analyst Selena Guo said AI stands at a critical juncture in China’s economic transition, driving disruption but also expected to fuel economic growth through productivity gains [3].
Chinese companies continue to balance AI adoption with social stability concerns, with cautious job cuts and targeted automation set to reshape employment patterns through 2027 and beyond.
