Abstract: With the wide application of information technology, capital deepening and technological progress have become the main trends in the development of China’s service industry, and have affected the employment structure of the service industry. This paper makes use of China’s provincial panel data from 2003 to 2015 to conduct an empirical study. The results show that the technological progress of China’s service industry presents skill biased characteristics, that the relative demand for high-skilled labors is increasing, and that the wage income gap between high and low skilled labors is also widening. At the same time, human capital has a significant positive effect on the demand for skills. Opening to the outside world has also promoted the growth of demand for skills in the service industry to a certain extent, and the export effect is greater than the import effect. The impact of technological advances on the skill structure of the service industry is uneven between the regions, it is positive in the eastern region, negative in the central region, and no significant effect in the western region.

Key words: technological advancement; skill bias; skill demand; skill premium; service industry