Remote work increasing in China amid COVID-19 outbreak

‘Biggest labour shift in history’? 

Since the end of the Lunar New Year, and the resumption of work in early February amid the spread of the coronavirus (COVID-19), an unprecedented experiment of working offsite has begun to take place in China. For about the last 20 days, approximately 10 million corporate employees have been working from home, relying on local video conferencing applications, such as WeChat Work, DingTalk, and Feishu. The unexpected transition from office to home has exposed the unpreparedness of Chinese companies to engage in remote management of their employees. With the scale of China’s labour market, it is perhaps the biggest shift towards remote work in history.

A crisis for manufacturing sector . . .

A recent report by Alibaba, China’s largest technology and e-commerce corporation, shows that the spread of COVID-19 and the inability of many people to return to work has hampered the economy’s productivity, especially in the manufacturing sector, which requires the physical presence of its employees. Economists have predicted that China’s GDP growth will fall from 6 per cent last year to 5.4 per cent in 2020 due to the spread of the virus. But all news is not bad news. Service sectors have seen unexpected growth: food delivery and online services have been growing since the outbreak in January.

Transition to service-based economy a challenge . . .

China’s experiment with remote work highlights some of the challenges of transitioning from a manufacturing-based economy to a service-based one – a vision that Beijing endorsed in its ‘Made in China 2025’ strategy. Nevertheless, the damages upon manufacturing and emerging opportunities in services and remote work may serve to accelerate this process. Foreign companies, such as U.S.-based TransparentBusiness, that specialize in software that monitors remote work, see this as an opportunity for growth in China. At the same time, however, it may also mean the growth of more Chinese homegrown businesses that focus on similar software and technology.