China: Behind the Clean Panels: The Livelihood Concerns of 220,000 Chinese Workers

(Dân trí) - Although it has surpassed coal power in scale, China’s solar power industry is undergoing a harsh shakeout as selling prices plummet, forcing companies to cut staff and automate operations.

In late 2025, workers at a solar panel manufacturing plant in Anhui Province, China, were suddenly notified of a temporary work suspension lasting up to five months. Shortly thereafter, the company introduced a financial support package to encourage employees to voluntarily resign. This is not an isolated incident but has become a common plight for many workers in the clean energy production chain in the world’s most populous country.

July marked a historic milestone as China’s solar power generation capacity surpassed coal-fired power for the first time. However, behind this impressive advance lies a harsh reality: more than two years of consecutive losses, bottoming-out selling prices, and a wave of layoffs spreading across the industry.

The “Oversupply Storm” and the Wave of Workforce Reductions

According to Eco-Business, the 2026 semi-annual data indicates that revenue across China's photovoltaic industry continues to decline. Previously, in 2025, more than 70% of major enterprises operated at a loss, and over 50 companies filed for bankruptcy.

Between 2024 and 2025, 110 top listed photovoltaic companies collectively cut 222,800 jobs. In 2024 alone, the number was 140,000, while 2025 saw an additional 68,200 workers leave the factories.

Severe overcapacity has caused spot prices for solar panels to drop by more than half, falling to 1 yuan per watt (approximately 0.14 USD), a level below production costs. Facing the pressure to maintain cash flow, companies have been forced to reduce working hours, cut wages, and encourage employees to resign.

Caroline Goron, an expert at Duke Kunshan University, noted that many facilities implement long-term leave measures not necessarily to suppress workers. In reality, they no longer have the financial resources to pay regular wages or cover official severance benefits.

According to reports by Gulf Insider, three major players in the industry—JinkoSolar, JA Solar Technology, and Tongwei—have all reported deeper losses in the first half of the year. A representative of JA Solar assessed that the market is still under significant pressure from structural oversupply, while efforts to reduce production volumes require more time to take effect.

Automation plants and the shift in employment

To survive amid plummeting prices, manufacturers have been forced to accelerate the modernization of their production lines to minimize operational costs.

According to Eco-Business, automated assembly lines and "lights-out" factory models powered by artificial intelligence are proliferating. A notable example is LONGi's facility in Jiaxing, where the automation rate reached 90% within just nine months of upgrades. These improvements have reduced the production cycle by 84% and increased hourly output by 35%.

In return, the demand for machine operators has declined rapidly. At LONGi, more than half of the production workforce has been cut. Industry-wide statistics indicate that approximately 75% of the eliminated positions were in factory operations. By 2025, the impact has extended to administrative, technical, and managerial staff.

Cosimo Reis, an expert at Trivium China, stated that solar equipment is relatively easy to automate. Companies that are slow to adopt robotics and intelligent systems will find it very difficult to maintain their competitiveness.

The rare bright spot lies in the sales division and high-tech segments. As inventory clearance becomes a matter of survival, companies are ramping up the recruitment of sales personnel. Additionally, inverter manufacturers and energy storage solution providers are maintaining their growth momentum, driving demand for highly skilled technical positions.

The supply-demand balancing equation

The investment boom began in 2020, following the Chinese government’s commitment to peak emissions and its target of 1,200 GW of renewable energy capacity by 2030. This wave drove a surge in newly registered photovoltaic enterprises to 600,000 by 2023. As a result, by 2025, global manufacturing capacity exceeded 1,100 GW, nearly double the actual installation demand (approximately 570–630 GW).

While the manufacturing sector faces an oversupply crisis, the downstream segment continues to set new records. Citing data from China’s National Energy Administration (NEA), China Daily reported that the country’s combined wind and solar power capacity surpassed the 2 billion kW (equivalent to 2,000 GW) mark by the end of September. In the first nine months of the year, electricity generation from these two sources reached 1.93 trillion kWh, contributing as much as 64% to the national increase in electricity consumption.

Despite this, the market is entering a phase of adjustment. Since July last year, new renewable energy projects in China have been required to sell electricity through market-based mechanisms rather than at fixed prices, making investors more cautious. Coupled with Beijing’s cancellation of the export tax rebate policy in April and the rise in external trade barriers, the volume of photovoltaic equipment exported in the most recent month fell 21.4% year-on-year.

To halt the downward slide, in August, the eight largest polysilicon producers (which account for 90% of China’s supply) reached an agreement to stop selling below production costs, aiming to establish a new price floor for the market.

Analysts assess that the market may begin to find a point of balance by the end of this year or next year, once the wave of mergers and the phase-out of outdated capacity is complete. After this major shakeout, the photovoltaic industry will operate more leanly with a higher technology content, but traditional employment opportunities for hundreds of thousands of general workers are unlikely to return to previous levels.