Published by ChinaMNC · Huan
China’s New AI and Employment Policy: What Foreign Founders Need to Know
A practical guide for foreign founders on China’s latest policy to harness AI for job creation, including support for startups, talent development, and risk mitigation.
China’s New AI and Employment Policy: What Foreign Founders Need to Know
The Chinese government has issued a new set of opinions aimed at adapting to artificial intelligence (AI) development while fostering an employment-friendly development model. For foreign founders building or operating companies in China, this policy signals both opportunities and compliance considerations. Below is a summary of the key points from the official document, translated into practical guidance.
1. Expanding AI-Related Employment Opportunities
The policy encourages the expansion of AI-related jobs across regions. Eastern regions are encouraged to develop core AI industries, while central and western regions are guided to take on upstream and downstream industries such as data annotation and intelligent terminal manufacturing. The goal is to create new growth points for employment. Foreign founders in AI or related sectors may find opportunities to align with these regional development strategies.
Additionally, the government plans to support intelligent-native enterprises and specialized SMEs by including eligible companies in special loan programs for stabilizing and expanding employment. This could mean easier access to financing for qualifying foreign-invested enterprises.
2. Support for SMEs and Startups
The policy includes an AI entrepreneurship support plan for small and medium-sized enterprises (SMEs), promoting open-source ecosystems to boost innovation. Public services for digital transformation will be strengthened, and SMEs are encouraged to develop lightweight, low-cost digital solutions. The policy also emphasizes equal access to data and algorithms for SMEs and individual businesses. For foreign founders running SMEs, this may reduce barriers to adopting AI technologies and improve workforce absorption.
3. New Models for AI Entrepreneurship
Government investment funds, such as the National Venture Capital Guidance Fund and the National AI Industry Investment Fund, will be used to support innovative AI enterprises in a market-oriented manner. The policy also promotes high-level open-source AI communities and various entrepreneurship models combining scientific achievements, industry development, vocational skills, and social needs. Foreign founders may explore partnerships with these initiatives or utilize open-source resources for their ventures.
4. Development of New AI Occupations
As AI applications expand, new occupations and standards will be developed. The policy calls for increasing demand for roles like digital managers, AI engineering technicians, and AI trainers. Localities are encouraged to add relevant professional titles and skill certification. Foreign companies may need to consider these new roles when building their teams in China.
5. Tapping into Traditional Sectors
The policy encourages AI to transform traditional industries, promoting human-machine collaboration in industrial and agricultural digitalization. It also aims to expand employment in services by developing new service models and consumption scenarios. Foreign founders in traditional sectors can explore AI-driven upgrades to enhance efficiency and create new job opportunities.
6. Mitigating Job Displacement
The government acknowledges the potential for AI to displace workers and calls for a cautious approach in labor-intensive industries. Enterprises are encouraged to establish unemployment buffer periods, notify affected workers in advance, and provide transition support. Foreign employers should be mindful of these expectations when implementing AI solutions that affect their workforce.
7. Employment Risk Assessment Mechanism
An employment risk assessment mechanism will be established for AI applications. For projects in market access areas that may cause significant employment impact, employment risk assessments will be conducted during review. Other AI projects will also undergo assessments as needed. Foreign founders planning large-scale AI deployments should factor this into their compliance planning.
8. Talent Cultivation
Universities and vocational schools are encouraged to adjust curricula to meet AI needs, including interdisciplinary programs and micro-specializations. School-enterprise collaboration will be strengthened, with support for leading tech companies to participate in curriculum development and teaching. Foreign companies can collaborate with educational institutions to cultivate talent and potentially benefit from a skilled workforce.
9. Special Training Programs
A special AI training plan will be implemented, targeting youth, migrant workers, and unemployed individuals. Localities are encouraged to use public training bases and online platforms to provide AI-related skills training. Foreign founders may leverage these programs to upskill their local employees.
10. Intelligent Employment Services
The policy promotes the use of AI to improve employment policy implementation, including smart identification and push of policies. Public employment services will be upgraded with AI, and new products like smart recruitment models and virtual reality training are encouraged. Foreign companies can expect more efficient government services related to employment.
11. Support for Job Transitions
Workers affected by AI-induced job displacement will receive employment assistance, including career guidance, skills training, job recommendations, and entrepreneurship support. Unemployment insurance benefits will be provided as required. Foreign employers should be aware of these support mechanisms when managing workforce transitions.
12. Labor Rights Protection
The policy calls for research on labor rights in human-machine collaboration, strengthening consultation mechanisms, and ensuring workers' rights to pay, rest, and safety. It also regulates AI in HR management, prohibiting algorithmic abuse that leads to discrimination, fake recruitment, or privacy violations. Foreign founders must ensure their AI tools comply with these regulations.
13. Social Security for Flexible Employment
Social security systems will be made more flexible and inclusive, encouraging flexible workers and new employment forms to participate in urban employee pension insurance. Pilot programs for occupational injury protection will be expanded. Foreign companies hiring flexible workers should stay informed about these developments.
14. Income Distribution Mechanism
Enterprises are guided to establish compensation systems suited to AI professionals, with incentives for high-level talent based on knowledge value. Skill-based minimum wage guidelines will be implemented. Foreign founders should review their salary structures to align with these guidelines.
15. Risk Monitoring and Research
The policy strengthens monitoring and early warning of employment risks from AI applications, including data sharing and intelligent analysis models. Research on AI's employment impact will be conducted, and risk response mechanisms will be integrated into existing unemployment risk prevention frameworks. Foreign companies should monitor these developments as part of their risk management.
Conclusion
China's new policy aims to balance AI development with employment stability. For foreign founders, it offers support for innovation and SME growth, while also introducing compliance requirements related to risk assessment and labor protection. Staying informed and adapting to these policies will be crucial for successful operations in China.
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 company registration and operations in China, foreign founders can contact ChinaMNC on WhatsApp / WeChat at +86 153 1898 8535.