Li Zhide
The claim that “China now has 320 million flexible workers” has recently attracted a great deal of attention online. Some see it as evidence of a new economy taking shape. Food delivery, ride-hailing, livestreaming, e-commerce, self-media, domestic services, freelance design, and independent programming have all created ways to earn a living outside traditional organizations. In the past, many people had to enter a company or public institution to make money. Today, in some occupations, one person with a smartphone can work independently. Others draw the opposite conclusion: if 320 million people do not hold formal jobs, China’s labor market must be in serious trouble.
The figure of “320 million flexible workers in 2026” is not an official statistic already released by China’s National Bureau of Statistics. It is a projection from the 2025 China Blue-Collar Employment Report, released in June 2026 by the China Research Center for New Forms of Employment. The report estimated that China had about 280 million flexible workers in 2025 and projected that the number could reach 320 million in 2026. According to Caixin, the study drew on 28,450 valid survey responses, along with other data and field research. One official benchmark is clearer: around 2021, China already had roughly 200 million people engaged in flexible employment. The category itself is broad. It includes self-employment, part-time work, and new forms of platform-based work. It is not limited to food-delivery riders and ride-hailing drivers.
The increase from 200 million to 280 million took about four years, or roughly 20 million people a year on average. The 320 million figure is still a projection. Definitions may also differ across years, so figures from separate reports cannot simply be stitched together and treated as one consistent official time series. Even so, 320 million is not a number that can be dismissed. The real issue is not whether the correct figure is 280 million, 300 million, or 320 million. The larger change is clear: China now has an enormous population working outside traditional forms of employment.
What does that mean in political-economic terms?
Risk Is Shifting from Firms to Individuals
The first step is to separate concepts that are often mixed together. Flexible employment is not unemployment. Someone who delivers food for eight hours a day and earns an income is employed. A freelance designer who serves ten companies a year is employed. A person who runs a small shop may receive no salary, but still produces goods or services and earns an income. The National Bureau of Statistics has also made clear that both regular and flexible workers count as employed as long as they provide goods or services in the labor market and generate output. It is therefore wrong to describe 320 million flexible workers as 320 million unemployed people.
But the opposite conclusion is also mistaken. Being counted as employed does not mean all employment problems disappear. Economics still has to ask at least four questions: How much do people earn? How stable is that income? What protections do they have? Is there a path for advancement? A programmer earning 20,000 yuan a month while choosing clients and working hours, and a delivery rider working ten hours a day with income fluctuating according to orders, can both be classified as flexible workers. Their economic lives are completely different.
There are really two kinds of flexibility. One is flexibility enjoyed by the worker: the ability to decide when to work, whom to work for, what to charge, whether to reject an order, and when to change clients. The other is flexibility enjoyed by the firm: workers are called in only when needed; when demand falls, the firm does not have to carry the same wage costs; prices may be set by a platform; assignments may be distributed by algorithms; and the worker may still not be treated as a conventional employee. Both are called “flexible employment,” but their economic meaning is very different. The political-economy question is simple: Who is actually becoming more flexible? If workers gain freedom, that is progress. If firms gain flexibility while risks are shifted onto workers, the picture is very different.
Traditional industrial employment had a relatively clear structure. When a company hired a worker, it generally took on a set of fixed costs: wages, pension contributions, medical insurance, work-injury protection, unemployment insurance, workspace, training, and part of the occupational risk. Even when business slowed, many of these costs did not disappear immediately. Platform work and project-based employment have changed this relationship. A food-delivery job exists only when an order appears. If there is no order, a platform usually does not pay a waiting wage. A company needing a logo can hire a freelance designer and end the relationship once the project is complete. A ride-hailing platform can expand or shrink its pool of drivers according to demand without carrying the same long-term wage obligations as a traditional taxi company.
From the perspective of the firm, this can look like an efficiency gain: fixed costs become variable costs. But costs do not simply vanish. They move. Who bears the risk when there are no orders? The worker. Who bears the risk of being unable to work because of illness? The worker. Who pays for the vehicle, phone, computer, or workspace? Often the worker. Who absorbs the shock when income suddenly falls? Again, mainly the individual and the family.
The deepest change created by flexible employment is therefore not just that “the way people work has changed.” It is that the distribution of economic risk has changed. The International Labour Organization and the OECD have both drawn attention to a similar problem in platform work: some supposedly independent workers are technically self-employed but cannot set prices, determine how work is organized, or control the rules governing the service. They do not enjoy the real autonomy of entrepreneurs, yet they carry many of the operating risks and social-protection burdens that firms once absorbed.
That is why the rise of flexible employment should not automatically be treated either as economic progress or as economic collapse. It is better understood as a repricing of the employment relationship. In the past, capital bought a relatively stable block of labor time and accepted part of the risk attached to the worker. Increasingly, firms buy a task, a delivery, or a project. The company becomes lighter. The worker has to manage more of the uncertainty.
The Biggest Macroeconomic Problem Is Uncertainty
The most important macroeconomic effect of flexible employment may not be the level of wages itself, but the uncertainty of income. Someone who earns 8,000 yuan this month and expects roughly the same next month can plan consumption, borrowing, and saving with some confidence. Someone who earns 10,000 yuan this month but has no idea whether income three months later will be 10,000 or 4,000 behaves differently. Even if the two people earn the same average income over the year, the second has a stronger reason to hold back cash.
Economists call this precautionary saving. That does not mean all 320 million flexible workers are afraid to spend. The group is far too diverse for such a claim. A more defensible conclusion is this: if the share of workers with unstable incomes and weak employment protection keeps rising, while social protection fails to adapt, households will have stronger incentives to save against future risks.
This is not merely an online hypothesis. The World Bank’s 2025 China Economic Update argued that stronger social protection for migrant workers, temporary workers, and similar groups could reduce precautionary saving and support household consumption. An IMF study released at the end of 2025 also linked China’s high household savings to weaknesses in social protection and differences in access to public services associated with the household-registration system. Stronger safety nets, it argued, could reduce the need for households to self-insure and thereby raise consumption.
This connects flexible employment to one of China’s larger economic challenges: domestic demand. Income has two basic destinations—consumption or saving. When the future feels secure, households are more willing to spend. When the future feels uncertain, they must build their own insurance. They may need to prepare for medical bills, unemployment, retirement, and children’s education. The more risks individuals must carry themselves, the more a bank account begins to function like a private social-security fund.
This can create an important macroeconomic chain:
employment uncertainty → more precautionary saving → lower propensity to consume → weaker business demand → more cautious investment and hiring.
Flexible employment does not automatically produce this chain. But if social protection fails to keep pace, it can reinforce it.
Most social-security systems built in the industrial era assumed a basic model of employment: one person working steadily for one organization. The employer contributed to pension, medical, unemployment, and work-injury insurance. Wages arrived monthly. Workplaces were relatively fixed. But when more people serve several firms or platforms at once—driving today, selling online tomorrow, working independently next month—a system centered on a single employer naturally begins to show gaps.
By the end of 2024, 70.57 million people in China were participating in the employees’ basic pension system as flexible workers, while 66.159 million were covered by employees’ basic medical insurance. When the Standing Committee of the National People’s Congress reviewed the government’s report on this issue at the end of 2025, it also noted that participation rates in pension and medical insurance among flexible and new-form workers remained relatively low. This is the part of the concern about “who will support 320 million people in retirement?” that deserves serious attention.
Two popular claims, however, need correction. One is that “China’s pension system is simply pay-as-you-go.” That is not accurate. China’s employees’ basic pension system combines social pooling with individual accounts. The pooled component has strong pay-as-you-go features, while individual accounts have an accumulation element. The law is explicit about this structure.
Another claim is that “China’s pension system will first run a deficit in 2029.” That number comes from an older actuarial projection, not a current official forecast for 2026. A 2019 actuarial report from the World Social Security Research Center at the Chinese Academy of Social Sciences projected, under a specific set of assumptions at the time, that the annual balance of the urban enterprise employees’ pension system could turn negative around 2028, with accumulated reserves potentially exhausted around 2035. It was a scenario designed to warn about reform pressures, not a fixed prediction. Since then, China has introduced national pension pooling, gradual retirement-age reform, and other policy changes.
The underlying challenge remains. But it should not be discussed by recycling an old forecast as if it were a fixed date. The better question is: if employment is becoming more mobile, why must pension, medical, unemployment, and work-injury protection remain so tightly tied to a single employer?
A Notable Institutional Experiment
There is already an interesting experiment underway. China’s occupational-injury protection program for workers in new forms of employment represents an important institutional innovation.
Traditional work-injury insurance is based on a conventional employment relationship: a company has employees, and the company pays contributions. But the legal relationship between food-delivery riders, ride-hailing drivers, and digital platforms often does not fit the traditional model. The pilot program addressed this problem in a simple way: instead of focusing only on the labor contract, it focuses on the order.
When a worker completes an order, the platform pays into an occupational-injury protection scheme. By July 2026, the program had expanded nationwide, using methods such as daily enrollment, per-order contributions, and monthly payment. By the end of June 2026, cumulative enrollment had reached 29.902 million people. By the end of July, it had risen to 34.588 million.
The significance of this experiment goes well beyond work-injury insurance. It demonstrates that social protection can gradually shift from “following the employer” to “following the person and the work.” If someone works for three platforms, all three could contribute according to the actual labor performed. A person might deliver food today and drive passengers tomorrow, while the protection account remains attached to the individual.
If technology and administration allow, pension protection, occupational-injury coverage, and perhaps other benefits could increasingly become portable in this way.
This may make more sense than simply requiring every flexible worker to bear the full cost of social insurance alone. If companies benefit from lower fixed costs through flexible labor, they should also bear part of the social costs created by that employment model. In political-economy terms, this is a question of internalizing costs.
At a deeper level, the growth of flexible employment also changes the bargaining relationship between firms and workers. In a traditional company, an employee at least knows who the employer is. If wages are too low, there is a company to confront. If working hours become excessive, there is an identifiable employer. If an accident occurs, the responsible entity is relatively clear.
Platform work makes this relationship more complex. Prices may be set by an algorithm. Rules may be set by the platform. Workers may be managed through an outsourcing company. When a dispute occurs, the platform may say no formal labor relationship exists, while the contractor may claim it is only a service provider. The worker ends up facing an organizational structure that is difficult to see.
That is why the simple question “Is there a labor contract?” is no longer enough to determine whether a labor relationship is fair. The more important questions are: Who sets the price? Who assigns the task? Who can punish whom? Who controls the data? Who bears the losses? Who can walk away without paying a huge cost?
If a supposedly “independent worker” cannot set prices, cannot directly reach clients, depends heavily on one platform for income, and must accept that platform’s ratings, assignments, and penalties, then the worker may not be economically independent in any meaningful sense.
Recent ILO work on platform labor increasingly discusses worker classification, social protection, algorithmic transparency, and collective bargaining together. These are also issues China will need to continue addressing. “Flexibility” should not become a legal device for avoiding labor responsibilities. Workers who are genuinely independent should have freedom. Workers who are economically subordinate should receive protections that reflect the degree of that dependence.
Political Economy Is Ultimately About a New Social Contract
So what does 320 million really mean?
It does not mean that “China already has 320 million unemployed people.” Nor does it simply mean that “the new economy has created 320 million free professionals.” What it really tells us is this: the labor market has changed, while some of the institutions supporting that labor market still retain the shape of the industrial era.
The old social contract was relatively clear. Firms provided jobs. Workers provided labor. Firms absorbed part of the risk. The state built social protection around stable employment relationships.
The next social contract has to look different:
work can be flexible, but protection cannot disappear; labor can be mobile, but rights must be mobile as well.
That means social insurance should increasingly follow the worker rather than a single employer. Platforms that actually organize and control labor should bear social-protection costs proportionate to that control. Pension and medical contributions should allow more flexible schedules and contribution bases, instead of forcing workers with volatile income to carry the same cash-flow burden as workers receiving stable salaries. Employment records, occupational-injury protection, and pension rights should remain continuous when workers move across platforms. When algorithms determine income, assignments, and penalties, workers should have basic rights to information and appeal.
There is also a more basic need: better data.
It is no longer enough simply to publish a headline number showing how many people are engaged in flexible employment. Policymakers should also know how many chose it voluntarily, how many entered it because they could not find stable work, how many hours they work each week, what their median income is, how volatile that income is, how many have pension, medical, and occupational-injury protection, and how many would prefer to move into stable employment.
Only with this information can we determine whether a country’s flexible employment represents greater freedom or greater insecurity.
The number 320 million easily produces two emotional reactions. One is panic: “Half the country no longer has a real job.” The other is optimism: “China has completely upgraded its employment model.” Both are too simple. A serious economic judgment cannot stop at counting how many people are “employed.” It also has to examine the income, stability, productivity, protection, and bargaining power associated with those jobs.
Political economy asks one more question:
When economic transformation creates both gains and risks, who receives the gains and who carries the risks?
If platforms gain efficiency, consumers gain convenience, firms lower costs, and workers receive only uncertainty, such a model of flexible employment will be difficult to sustain. If workers gain genuine freedom to choose how they work while also receiving pension, medical, occupational-injury protection, and opportunities for advancement, flexible employment can become a healthy and effective part of a modern economy.
China’s real task, therefore, is not to force 320 million people back into traditional organizations. That era is not coming back. The real task is to build institutions suited to a new world of work: allow firms to remain flexible while giving workers security; allow technology to raise efficiency while ensuring that workers share in productivity gains; allow people to change jobs, cities, and platforms without leaving their social protection behind.
Only then will “flexibility” truly mean freedom. Otherwise, it simply means turning uncertainty once carried by firms into uncertainty carried by workers. And an economy in which hundreds of millions of people are unsure of what they will earn tomorrow will eventually face more than an employment problem. It will also face problems of consumption, retirement, income distribution, and, ultimately, the way society itself distributes risk.That is the real political-economic meaning of “320 million flexible workers.”