China’s Lao Gan Ma denies mass layoffs linked to AI amid public backlash

Chinese chilli oil producer Lao Gan Ma has refuted claims that it replaced hundreds of jobs with AI technology, following public backlash on social media. The controversy arose after an executive vice-president and chief quality officer, Li Xin, mentioned AI's role in reducing product defects and increasing revenue at a provincial government conference in late September.

Li stated that the number of workers on one production line dropped from over 600 to just 48 following the introduction of an AI-powered pepper inspection system last year. This prompted widespread criticism, with many accusing the company of prioritizing profits over workers' well-being, given its roots in working-class origins.

Lao Gan Ma subsequently denied the mass layoffs, clarifying that claims of significant job cuts were inaccurate. The company maintains that AI inspection technology was indeed used but that the production line had never employed as many workers as reported. This issue underscores growing concerns in China about AI's impact on employment, particularly in labor-intensive sectors, as the government strives to accelerate AI adoption amid economic and demographic pressures.