China speeds up industrial automation as workforce contracts

The Big Picture: China led the push for global industrial automation last year, installing as many robots as heavy in its factories as the rest of the world combined. Recent automation efforts are not so much about pioneering as about playing catch-up. Until recently, the nation has lagged behind other strong players such as Japan, Germany, South Korea, and the United States in terms of robotics in production lines.

Data from the International Federation of Robotics seen by the Wall Street Journal revealed that shipments of industrial robots in China increased 45 percent year-on-year to more than 243,000 units. According to the publication, this represents just under half of all industrial robots installed last year and cements the country’s position as a leading market for robotics manufacturers.

The latest batch may also be in response to the aging of China’s workforce, Slowing birth rates and increase wages. As the country can no longer rely on its workforce to drive economic growth, it is using automation to boost the productivity of its remaining workers.

The International Labor Organization estimated that China had 147 million people employed in manufacturing jobs in 2021, down from a peak of 169 million in 2012.

productivity Among workers is significantly lower than the global average in China. According to Conference Board data, China’s employee production per hour worked was about a quarter of the average of G7 countries including Germany, Japan and the United States last year. Productivity growth has also slowed, from an average of nine percent annually between 2000 and 2010 to just 7.4 percent over the past decade.

You can’t wait until we run out of people to start dealing with it, said Andrew Harris, deputy chief economist at Fathom Consulting in London.

However, China still accounts for most of the world’s manufacturing needs – about 29 percent according to data from the United Nations. Adding more robots to the equation will allow the nation’s factories to do more precise work than most humans can manage. It also doesn’t hurt that the cost of installing robots continues to dwindle.

image credit: mechanical mindAnd the Pixabay

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