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Robots could offset up to 60% of china's labor force loss
Economy
The widespread adoption of humanoid robots in China could offset up to 60% of the expected labor force loss by 2035.
This will help the country maintain the world's largest industrial base amid a rapidly aging population and declining birth rate, according to Bloomberg, citing an analysis by Barclays Bank.
The bank's analysts estimate that, given current demographic trends and the country's 65% labor force participation rate, China's labor force could shrink by 37 million people over the next 10 years. This will put significant pressure on the manufacturing sector, which accounts for about a quarter of the country's economy.
Furthermore, Barclays expects that, in an optimistic scenario, the total number of humanoid robots in China could approach 24 million by 2035. This number would be equivalent to almost 4% of the country's entire workforce. According to analysts, productivity gains through automation will only partially offset China's demographic challenges. However, the report emphasizes that an aging population and labor shortages are increasing the need for industrial automation. Barclays analysts believe that the shrinking labor force is creating a huge domestic market for robotics: "This is the decade of robots—and it belongs to China."
At the same time, the bank notes that the forecast is based on rather optimistic assumptions: for these to become reality, the current pace of innovation and robot adoption must be maintained for many years to come. Therefore, the analysts consider the estimate of 60% of the labor shortage to be more of an upper bound on the possible outcome.
Bloomberg reports that China's population currently stands at approximately 1.4 billion, but in 2025 the country will record its lowest number of births since at least 1949. The share of the working-age population has fallen to approximately 61%, down from over 70% 10 years ago. At the same time, the ratio between people of working age and citizens over 65, which is currently approximately four to one, is projected to halve over the next 20 years.