Published by ChinaMNC ยท Yongchang
China's New AI Employment Policy: What Foreign Founders Need to Know
China's State Council has issued new guidelines to harness AI for job creation while mitigating displacement risks. For foreign founders, this signals support for AI-driven ventures and a more structured labor environment.
China's AI Employment Policy: A Guide for Foreign Founders
In a significant policy move, China's State Council has released a set of guidelines aimed at adapting to the rapid development of artificial intelligence (AI) while fostering an employment-friendly development model. For foreign founders operating or planning to register a company in China, these guidelines outline the government's approach to balancing AI-driven economic growth with job stability and worker protection. Understanding these policies can help you align your business strategy with China's national priorities and leverage available support mechanisms.
Core Objectives: AI for Good, Jobs for All
The policy is guided by the principle that employment is the most fundamental aspect of people's livelihoods. It seeks to harness AI's positive potential to create jobs, empower traditional roles, improve job quality, and stimulate entrepreneurship, while effectively mitigating the negative impacts of job displacement. The overarching goal is to achieve inclusive development where technological progress, industrial upgrading, employment promotion, and livelihood improvement are coordinated.
Key Measures for Businesses
The guidelines detail a range of measures that directly affect businesses, from startups to large enterprises. Here are the most relevant points for foreign founders:
1. Expanding AI Employment Opportunities
The government will deepen the "AI+" initiative, encouraging eastern regions to cluster core AI industries and guiding central and western regions to take on upstream and downstream industries like data labeling and intelligent terminal manufacturing. This regional approach creates opportunities for foreign companies to locate different parts of their operations across China. Additionally, the policy supports the growth of AI-native companies and specialized "little giant" enterprises, and includes provisions to bring qualifying companies into special loan programs for stabilizing and expanding employment. This means easier access to financing for job-creating AI ventures.
2. Support for SMEs and Startups
Recognizing the role of small and medium-sized enterprises (SMEs) in job creation, the policy introduces an AI entrepreneurship support plan for SMEs. It promotes open-source ecosystems to foster innovation and encourages the development of "small, fast, light, and precise" digital products and solutions. Importantly, it ensures that SMEs and individual businesses can equally access intelligent production factors like data and algorithms. The policy also supports low-cost, lightweight intelligent upgrades, lowering the barrier for AI adoption and enhancing SMEs' capacity to absorb employment. For foreign founders starting small, these measures could reduce operational costs and improve access to resources.
3. New Models for AI Entrepreneurship and Employment
The government will leverage state investment funds, such as the National Venture Capital Guidance Fund and the National AI Industry Investment Fund, to support AI companies in a market-oriented manner. It also plans to build high-level AI open-source communities and implement quality open-source projects. The policy promotes various entrepreneurship models, including "scientific achievements + entrepreneurship," "industrial development + entrepreneurship," "vocational skills + entrepreneurship," and "livelihood needs + entrepreneurship." For foreign founders with innovative AI applications, these initiatives may provide funding, incubation services, and a supportive ecosystem.
4. Developing New AI Occupations
As AI applications expand, the government will accelerate the development of new occupations and publish new occupational standards. It aims to increase demand for roles like digital managers, AI engineering technicians, and AI trainers. Localities are encouraged to add AI-related professional titles and conduct skill-level certifications. This means a growing talent pool and clearer career paths for AI professionals, which can benefit foreign companies looking to hire skilled staff.
5. Transforming Traditional Sectors
The policy encourages the use of AI to upgrade traditional industries, promoting human-machine collaboration in industrial and agricultural digitalization. It also aims to develop new AI-driven service models, advancing producer services toward specialization and higher value, and expanding service consumption scenarios. This could open up new business opportunities for foreign companies in sectors like smart manufacturing, agriculture tech, and consumer services.
6. Mitigating Job Displacement
While promoting AI, the government is mindful of its impact on jobs. It advocates for the cautious application of AI in labor-intensive industries, with a focus on reducing shocks to workers. Companies are encouraged to establish unemployment buffer periods, provide advance notice to affected workers, and offer transition support. This suggests that foreign employers should plan for workforce transitions and may need to engage in social dialogue when implementing AI.
7. Employment Risk Assessment
For AI application projects that may cause significant employment shocks in market access areas, an employment risk assessment will be conducted during project review. Other projects may also undergo assessments as needed. Foreign founders should be aware that large-scale AI deployments might require such evaluations, and relevant authorities will coordinate support for job transitions.
8. Talent Development and Training
The policy emphasizes collaborative cultivation of AI talent. Universities and vocational schools are encouraged to dynamically adjust curricula, establish AI-related majors, and offer micro-specializations. Enterprises are supported to participate in curriculum development and teacher training. The government will also implement a special AI training plan, encouraging youth, migrant workers, and unemployed individuals to participate in AI training programs. For foreign companies, this means a more skilled workforce and opportunities to collaborate with educational institutions.
9. Smart Employment Services and Policy Implementation
The government will use AI to improve policy implementation, including intelligent identification of eligible recipients and targeted policy push. It will upgrade national employment information resources and public service platforms, and promote AI in job matching, smart interviews, and virtual reality training. This digitalization could make it easier for foreign companies to navigate employment policies and access services.
10. Worker Rights and Social Security
The policy calls for optimizing labor rights protection in human-machine collaboration, regulating AI in HR management, and combating algorithm abuse that leads to discrimination or privacy violations. It also aims to improve social security for flexible and new forms of employment, including expanding pilot programs for occupational injury insurance. Foreign employers should ensure compliance with these evolving labor standards.
11. Income Distribution and Risk Monitoring
The guidelines encourage companies to establish compensation systems suited to AI professionals, with incentives for high-level talent and skill-based minimum wages. They also call for monitoring AI-related employment risks, including data sharing and early warning systems, and integrating AI employment risks into unemployment risk prevention mechanisms. This indicates a more structured approach to labor market governance, which foreign companies should factor into their risk management.
Implications for Foreign Founders
These guidelines demonstrate China's commitment to steering AI development in a way that creates jobs and protects workers. For foreign founders, this translates into a supportive environment for AI-driven businesses, especially those that align with national goals of innovation, SME development, and talent cultivation. At the same time, companies should be prepared for increased scrutiny regarding employment impacts and labor rights. Engaging with local authorities and understanding these policies can help foreign businesses integrate smoothly into China's evolving economic landscape.
This summary is based on information published by the relevant Chinese government website and is general information, not legal or tax advice.
For assistance with registering and operating a company in China, foreign founders can contact ChinaMNC on WhatsApp / WeChat at +86 153 1898 8535.