Ning Guangjie and Zhang Xuekai wrote in the 6th issue of China's Industrial Economy for 2021 that rising labor costs and some enterprises tend to use machines to replace labor are important phenomena in China's economy. The increase of labor turnover rate will lead to the increase of per capita investment in machinery and equipment and per capita R & D investment. After a series of endogenous treatment and robustness test, this conclusion is still valid. The increase of labor turnover rate will indirectly increase the cost of enterprises and lead enterprises to take cost reduction measures. Expanding research finds that registered residence reform is lagging behind, improper labor market regulation and information barriers between enterprises and employees will lead to excessive labor turnover rate at the enterprise level. The article emphasizes that deepening system reform and improving the market-oriented allocation system and mechanism of labor factors can reduce unnecessary labor transfer at the enterprise level, alleviate the rapid rise of labor costs, and improve the use efficiency and competitiveness of enterprise factors.