Navigating China’s Sharing Economy: Employment, Competition, and Ethical Challenges Amidst COVID-19

[How to]: Use DiDi Now That It’s In English © 2017 by  ALEX PANAYOTOPOULOS is licensed under CC BY-NC 4.0 


In the complex global economic landscape, China’s booming sharing economy, supported by technology giants such as Alibaba and Didi, presents a paradox of simultaneous opportunities and difficulties in the market, especially during the COVID-19. This article aims to explore the multiple impacts of China’s sharing economy and analyze how it expands economic participation and leads to increased labor exploitation and inequality. Accordingly, this study aims to reveal the intertwined impact of employment mechanisms and industry competition in the epidemic environment. Amid the severe restrictions and existential pressures caused by the coronavirus pandemic, the impact of this economic model has been clearly polarizing, providing important employment opportunities on the one hand, and exposing huge moral and socioeconomic gaps on the other. This is closely related to migrant workers. This article will critically analyze these dimensions and assess their implications for sustainable economic development and ethical considerations in the post-pandemic era.

1.Employment and Labor Right

Obviously, the rise of China’s sharing economy has multifaceted impacts on employment, intensifying the polarization between beneficial and detrimental effects. The innovative construction of the sharing economy is not only promoting employment expansion in Chinese market, but also creates a flexible and autonomous employment environment (Guiheux G. et al., 2023).The surge in productivity and vast consumption has expanded China’s market share while also pushing its GDP to an unprecedented height. According to ChinaNews’s report(2023), “sharing economy in China has reached about 3.83 trillion yuan (555.54 billion U.S. dollars) in 2022, up 3.9 percent year on year”. Moreover, by strengthening policy support, the economic model also enhances the viability of small businesses. They are expanding and diversifying the market. Especially during the economic downturn triggered by the COVID-19, the relevance and necessity of sharing economy were emphasized. The persistence of the economic system has allowed its markets to flourish and also established alternative sources of income for the private sectors (de Kloet et al., 2019).

However, the profitable industry occurred significant risks and challenges, especially during the pandemic. The sharing economy subtly disrupts traditional employment models and weakens the rights for temporary workers (Guiheux G. et al., 2023). The temporary worker group is the fundamental support for the development of the sharing economy. Relative policies and phenomena issued during the COVID-19 pandemic have placed temporary workers in extremely precarious living situations. There is a lack of formal employment relationship between employer and employee. Those social factors have led a lack of basic rights and legal treatments to them, as they are situated in gradualmarginalization. For example, employers cannot provide them with comprehensive health insurance and stable income. These workers’ plight sharply deteriorated during the pandemic; for instance, delivery personnel and Didi drivers faced disproportionate health and financial risks, placing them on the brink of collapse and aimlessness.

Delivery drivers sit on their electric scooters while waiting for orders outside a restaurant in Beijing © 2021 by  Greg Baker is licensed under CC BY-ND 4.0 

Moreover, temporary workers during the pandemic are susceptible to virus transmission due to unstandardized epidemic protection measures (Lu, 2021). They also bear the financial burden of household expenses. This situation hinders their ability to consider basic needs while maintaining income and surviving in an environment lacking reliable health insurance, and it intensifies their insecurity. The continuous increase in demand for temporary work during the pandemic led to an increase in workload, but without a corresponding increase in remuneration and associated benefits, revealing a disconcerting gap (Guiheux G. et al., 2023).

Faced with the rapid development of the sharing economy, China’s existing labor rights framework is undoubtedly challenged. Clearly, the current legal and regulatory models are insufficient to offset the unique difficulties that come with temporary work, allowing exploitative practices to persist without accountability (Xinhua, 2023). Although discussions have taken place and gradual improvements to these issues have been made, the path to resolving these issues is evidently slow and suboptimal.

In summary, while the emergence of the sharing economy in China signals employment opportunities, it also highlights concerns about labor rights, particularly against the volatile backdrop of the Covid-19. The inherent instability of temporary work, coupled with a palpable lack of comprehensive legal protection, places a substantial portion of the labor force in a fundamentally vulnerable state. Therefore, a meticulous reevaluation and substantive reform of the existing labor rights framework are urgently needed to ensure the benefits of the sharing economy are fairly distributed and safeguarded while staunchly upholding basic human rights and labor rights.

A user holding a smartphone with a Didi Chuxing app. © 201 by  Zhang Peng is licensed under CC BY-NC 4.0 

2. Corporate Monopoly and Market Democratization

If we carefully analyze China’s booming sharing economy, we will find its contradictory effects, not only on market fairness but also on the huge income gap. Initially hailed as a democratizing force, the sharing economy has undeniably democratized market access through the development and application of platforms that create direct channels between suppliers and consumers. This approach creates a harmonious environment with sufficient resources and market share for small entrepreneurs, freelancers, and micro-enterprises to further build a professional market environment and, finally, become part of the overall economic ecosystem (Dwyer & SpringerLink (Online service), 2019).

In additional, with the vigorous development of the market, the decentralized performance of the sharing economy began to change, gradually forming an area monopolized by large capital companies such as Alibaba and Didi (Ma & Zhang, 2019). These corporate giants have consolidated contemporary forms of capital monopoly through their vast resources, technological prowess, and deep-rooted market influence. Huge data stores allow services and algorithms to be refined and further cement their market dominance. In the increasingly difficult market in which to survive and compete, small businesses and newcomers to the industry are marginalized (Dwyer & SpringerLink (Online service), 2019).

Eunice Yoon. (2021, June 29). Chinese tech giant Didi is much more than a ride-hailing app. [Youtube Video].

In the case, the wealth generated in the shared economic environment flows disproportionately to the technical elite. This group is either the leader of these conglomerates or people with highly sophisticated skills in this emerging economic model. These gains often endanger traditional labor sectors. However, the apparent financial instability and protections inherent in traditional employment models are eroding the sharing economy’s original promise of economic democratization. Relevant industry leaders and managers need to deeply analyze the reasons affecting market monopoly and take a thoughtful approach to the need to coordinate market quotas to ensure market fairness (Ma & Zhang, 2019). We can clearly discover the complex dynamics of the digital transformation of the sharing economy in this process. We need to be extreme alert in a scenario where capitalisms hold market dominance. They are not only havingpotential and speaking right, but often actively engages in the policy-making process. They will try to shape the regulatory environment that could have widespread implications. By working closely with policymakers or directly intervening in political activities, capitalists often manage to promote the implementation of regulations and standards that are more favorable to their business interests. The action will further solidify their discursive power in the market.

What’s more, they will make a certain extent, incorporates workers into a strictly defined and easily controlled social paradigm. Within the paradigm, capital market is able to maintain a strong and stable position, ensuring its dominant role in the economy. Meanwhile, workers, within this framework, are often restricted to a situation where their wishes can hardly be realized and democratic participation is scarce, with their rights and interests often being overlooked or sacrificed, thereby exacerbating social inequality and division.Therefore, China’s current market needs a strong regulatory framework to maintain fair competition, optimize personnel management systems to ensure labor rights, and advocate fair income distribution.

A taxi driver is using Didi Dacha App while driving on the way. China Investment Corporation (CIC) has made an undisclosed investment in Chinese taxi-hailing app maker Didi Kuaidi © 2015 by  Zhang Peng is licensed under CC BY-ND 4.0 


The multi-faceted development of China’s sharing economy requires a balance between adapting to innovative economic models while maintaining protection against the dangers of inequality, exploitation and monopoly. While the sharing economy has fueled economic growth and provided a buffer against the recession triggered by the pandemic. However, the resulting market gaps and employment challenges cannot be obscured. The first priority is to recalibrate regulatory and policy frameworks. Not only the economic and entrepreneurial aspects, but also a passion for safeguarding labor rights and ensuring fair distribution of benefits are indispensable.
The path forward requires technological advancements combined with ethical, equitable and sustainable practices. Innovation and a people-centered approach come together to shape a future that is not only economically vibrant, but also socially just and equitable. This journey is filled with unique challenges and possibilities, calling for careful exploration, research, and collaborative efforts from policymakers, industry participants, and the workforce. We are looking forward to next boom time to China’s sharing economy.

Referencing List:

Cendrowski, S. (2021, April 24). Didi is getting attention for its drivers’ crimes as it raises $2 billion. Fortune.

China’s sharing economy sustains growth momentum. (2023, February 25).

de Kloet, Poell, T., Guohua, Z., & Yiu Fai, C. (2019). The platformization of Chinese Society: infrastructure, governance, and practice. Chinese Journal of Communication, 12(3), 249–256.

Dwyer, & SpringerLink (Online service) (Eds.). (2019). The Business of News Sharing. In Martin, Sharing News Online Commendary Cultures and Social Media News Ecologies (1st ed. 2019., pp. 91–127). Springer International Publishing.

Eunice Y. (2021, June 29). Chinese tech giant Didi is much more than a ride-hailing app. [Youtube Video].

Guiheux, G. (2021, September 30). How the pandemic has changed China’s economy – perhaps for good. The Conversation.

Lu, H. (2021, January 11). Didi, Huaxiaozhu are fined after drivers test positive for covid-19. 一财全球 Yicai Global.

Ma, Y., & Zhang, H. (2019). Development of the sharing economy in China: Challenges and lessons. Innovation, Economic Development, and Intellectual Property in India and China, 467–484.

Panayotopoulos, A. (2017, May 31). [How to]: Use DiDi Now That It’s In English. SmartShanghai.

Reuters. (2019, February 1). China to execute driver who killed passenger of ride-hailing firm Didi Chuxing. CNBC.

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