China has an aging population like most countries. So, automation will likely help fill the gap rather than make work obsolete. However, if China does get to the point where a lot of work is automated, they have a socialist system where the government can do things like step in to reduce working hours or provide universal basic services which would be impossible in the west.

Ultimately, the whole point of an economy is to direct labour and resources in a way which allows people to have a good standard of living. If most labor can really be automated, then people can just spend more of their time enjoying their lives instead of working. The technology itself is not the problem. The only reason this becomes a crisis under capitalism is because the means of production are privately owned, and the people who own them require the rest of the population to sell their labor in order to live. Automation under private ownership frees people from a paycheck, while the owners keep the gains.