The global narrative about China and AI usually tells one story: China charging ahead while the West dithers. The reality is messier. Michael Schuman's reporting from Beijing paints a picture that should feel familiar to anyone worried about AI's impact on workers anywhere in the world—because the anxiety is not uniquely Western at all.
When Your Job Disappears Overnight
Xu Peng, a 30-year-old actor, had landed steady work in the short-drama series that have become enormously popular in China. After Chinese New Year 2026, he expected two new roles from the studio where he'd been working. Instead, he learned the productions were cancelled. The studio would make videos using AI instead.
"It was as though everything was fine yesterday, and today it is suddenly gone," Xu said.
A young 32-year-old Malaysian I happened to meet gave me some insight into what was happening with aspiring youth like him. He had been using fairly sophisticated tech to produce videos, but confided that lately jobs were drying up because of AI. "What do I do? I'm the eldest of 6 siblings, married with no kids but the future doesn't look very certain or bright. Do I jump on the bandwagon and learn AI? Where will that take me?"
The New Language of Displacement: "Distilled"
Chinese workers have coined a term for what's happening to them: being "distilled". It means an employer takes a worker's data—chat messages, documents, emails—and feeds it into an AI model to create a "digital robot" that takes over the job.
In May, a user named Nanbei on Douyin described learning after she left a job that her former employer had harvested thousands of her messages, hundreds of her documents, and every work email into an AI system that mimicked her responsibilities. The company even gave the AI her name. "The company no longer has to pay me a cent in salary, yet it can keep me there 'working overtime' forever," she wrote.
Bruce Jiang, a 42-year-old commercial director in Shanghai, describes a different anxiety: his clients have begun pressing him to use AI tools like Kling for video generation. He loves the craft—choosing the lens, finding the perfect shot—but that pleasure is disappearing.
"That pleasure is disappearing," he says.
The Party's Dilemma: Advance or Preserve?
What distinguishes China's AI anxieties from Western debates is not the anxiety itself but the absence of avenues to address it. In the United States, tensions are debated openly and managed through courts and legislatures. China has neither of these pressure valves, which puts the Communist Party in a bind: advancing AI may empower the country abroad, but holding it back may be necessary to preserve internal stability.
Nearly a fifth of young workers in China are already unemployed. Carl Minzner of the Council on Foreign Relations warns: "There is the potential for a lot of disgruntled people." A Hangzhou court has ruled the dismissal of a tech worker replaced by AI unlawful—a warning that mass AI-driven layoffs are politically unacceptable. Jeffrey Ding of George Washington University calls it a "balancing act": if AI demands "massive displacement", the party "might have to veer toward slowing down AI adoption".
The Question Everyone Avoids
Whatever one thinks of China's political system, the question its officials are wrestling with is one that employers and regulators everywhere will have to answer eventually: who bears the cost of the productivity gains AI makes possible? A Malaysian SME owner might not face the same political pressure as Beijing, but the question is the same. And it is better answered before a court answers it for you.
The AI Governance Question Won't Wait
If your business is considering AI—for cost savings, for efficiency, or for competitive advantage—the cost distribution question is worth asking now: who benefits, and who bears the cost if someone loses a role?