China is growing rapidly in the realm of robots, as the nation undergoes a 'wave of automation' driven by huge investments in the segment.
China's Integration of Robots Into Industrial Workloads Has Bumped Up Efficiency, But at the Cost of Employment
China has historically been an attractive region for manufacturers worldwide, mainly due to the lower labour costs associated with intensive tasks such as product assembly. However, as the world moves towards automation, so is China, in order to maintain its labour rates, as according to a new report by The Financial Times, it is claimed that China's robot-to-worker density is ahead of leading nations like Germany, and is about to reach parity with South Korea. This is mainly driven by the state's interest in the segment, although with huge tax credits and investments associated with autmoation.
The report claims that Chinese factories install a whopping 280,000 industrial robots yearly, and more than half of these are made by domestic firms. Interest in robotic automation is immense in China's industrial sector, and local companies are seen as a great option, given that they provide better pricing than global alternatives. With this, China is defying the norms of economics, since with time, labour costs should rise, but the report from FT claims that robots are actually decreasing labour costs and increasing efficiency.
The robotic hype isn't just limited to the industrial segment, but China is also rapidly advancing in the realm of humanoid robots, with firms like Unitree securing large-scale investments to introduce low-cost and rather amazing solutions to the market. China's manufacturing capabilities, coupled with the country's 'Made in China' ambitions, have apparently sped up the process of integrating robots across labour-intensive workloads, which is turning out great for the nation.
One of the downsides of employing automation across industries is the effect on overall employment, which is reportedly due to a downturn in China. In over a decade, employment across several sectors fell by about 26.5%, according to data from the Chinese government, and robots played a huge role in this. As NVIDIA CEO Jensen Huang says, 'Physical AI' is the next big thing, but it might come with the cost of replacing humans, especially in labour-intensive environments.
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