China shifts to AI to address the record-breaking wave of 12.7 million graduates seeking employment

Investing.com — The Chinese government announced on Saturday that it will actively utilize artificial intelligence to absorb a record 12.7 million university graduates into the labor market this year. This large number of job seekers exceeds Belgium’s total population, prompting Beijing to turn to technology-driven employment strategies amid increasing population and economic pressures.

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The CSI 300 Index remains sensitive to this news, closing at 3,842.15 points this week, as investors weigh the potential of government-led AI investments against the cooling of the domestic economy. Minister of Human Resources and Social Security Wang Xiaoping emphasized during the National People’s Congress that the government plans to use AI to “upgrade” traditional jobs and develop new employment channels.

Wang Xiaoping warned that despite ambitious government plans, the “growing uncertainty” continues to threaten broader employment stability across mainland China.

Career Transformation and Low-Altitude Economy

To achieve the goal of creating 12 million new urban jobs by 2026, Beijing is launching large-scale internship and training programs, focusing on high-growth emerging sectors. Special emphasis is placed on career development in the “low-altitude economy,” new energy vehicles (NEV), and generative AI. This strategic shift indicates China’s move from traditional manufacturing toward higher-value, technology-intensive industries.

Global investors understand that the success of this transformation is crucial to maintaining China’s urban unemployment rate target of 5.5% by 2030. Goldman Sachs analysts note that AI integration could boost long-term productivity, but immediate challenges remain, particularly the “skills gap” among recent graduates entering a highly competitive environment.

The government’s focus on AI as a job creator marks a departure from global concerns about automation-induced unemployment. By positioning AI as a “job upgrade” tool, China aims to stabilize its youth unemployment figures, which have been closely watched over the past year. Market participants are now paying attention to upcoming China-U.S. trade negotiations to see how these domestic labor strategies might intersect with international technology export restrictions.

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