Alibaba to Generate 30 Percent of Jobs in China’s Digital Economy - Global Trade Magazine
  May 9th, 2017 | Written by

Alibaba to Generate 30 Percent of Jobs in China’s Digital Economy

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  • Alibaba’s ecommerce platform has already created 31 million jobs.
  • Alibaba’s ecommerce platform has generated jobs through the creation of new online businesses and in logistics.
  • Alibaba’s Tao Factories offer merchants small-scale manufacturing.

By 2035, ecommerce giant Alibaba could generate about 30 percent of all the jobs available in China’s digital economy, according to a new report from management advisory firm Boston Consulting Group.

The study, entitled “Year 2035: 400 Million Job Opportunities in the Digital Age,” said Alibaba, which has expanded into cloud computing, financial technology, and media and entertainment, could account for as many as 122 million of the 415 million total jobs available in China’s digital economy, or 29.4 percent.

“If Alibaba-generated employment has the same share of China’s digital economy in 2035 as in 2015, the platform will create 112 million jobs,” said the report. “If Alibaba’s emerging businesses, such as cloud computing and digital entertainment, play a strong future role as well, we can expect another 10 million jobs by 2035—for a total of 122 million jobs.”

According to a 2016 study by Renmin University in Beijing, Alibaba’s ecommerce platform alone has already created 31 million jobs. Most of those jobs have come through the creation of new online businesses using Alibaba’s platform as and through other businesses that grew up around the ecommerce phenomenon, such as logistics.

Besides ecommerce, Alibaba has created jobs in so-called Tao Factories which offer merchants selling on Taobao access to small-scale manufacturing and in over 1,300 Taobao Villages–centers of ecommerce in the rural countryside. The IT infrastructure provided by Alibaba Cloud has generated 1.2 million jobs at Chinese startups, according to the BCG report.

BCG also took a look at the larger impact that technology would have on employment and talent over the coming two decades. The report estimated that China’s digital economy would make up 48 percent of the country’s total economy in 2035, accounting for $16 trillion in spending. In 2015, those numbers were 13 percent and $1.4 trillion respectively, and just over 100 million jobs.

A number of trends are expected to drive that growth, including tectonic changes to retail, finance, and manufacturing, three sectors already being targeted by Alibaba.

New Retail is the merger of online and offline commerce into a single omnichannel experience. It involves using the internet, technology, and data to better engage consumers.

New Finance is the use of the internet, the cloud, and data to deliver services to consumers. Alipay, a financial technology platform, has grown from providing online payments to one that includes everyday tasks, social life, and services for 450 million users, according to BCG.

New Manufacturing anticipates the use of near real-time consumer data to help make manufacturers more nimble and responsive to purchasing trends, even shifting the flow of product creation from businesses to consumers (B2C), to consumers to businesses (C2B). Some Chinese companies “are customizing product design and then producing on a large scale according to individual demand,” said the report.