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China’s birth rate has been falling for years
Item Information
- Author, Samantha Chan
- Rolle, from BBC News in Singapore
March 26, 2023
Crystal (not her real name) lives in Beijing, China and is 26 years old. Unlike most Chinese women in recent generations, she is not married and currently feels no pressure to start a family.
When I ask why, she laughs, “I think it’s because my relatives have never married or divorced.”
This seems to be a common sentiment among women living in Chinese cities.
A 2021 survey by the Communist Youth League of China surveyed nearly 3,000 people between the ages of 18 and 26. More than 40% of young women living in cities had no plans to get married. For men it was less than 25%.
Reasons include rising childrearing costs and the horrors of the Chinese onechild policy.
“Having one or no children has become the social norm in China,” said Yi Fuxian, a senior researcher in obstetrics and gynecology at the University of WisconsinMadison in the United States and a wellknown critic of the onechild policy.
“The economy, the social environment, education and pretty much everything else revolves around the onechild policy,” he adds.
For Beijing, the trend is worrying as the Chinese population is declining. The birth rate has been falling for years, but in 2022 the population fell for the first time in 60 years.
This is bad news for the world’s second largest economy. The workforce is declining and the aging of the population is putting increasing pressure on public social security funds.
China’s workingage population between 16 and 59 years old is currently around 875 million, or just over 60% of the country’s total population. According to an official estimate by the Chinese government in 2021, that number is expected to fall further by 35 million over the next five years.
“China’s demographic structure in 2018 was similar to Japan’s in 1992,” says Yi. “And the [estrutura demográfica da] China in 2040 will be similar to Japan in 2020.”
Until last year, many economists thought that Chinese growth would overtake that of the United States by the end of the decade. This change would crown the country’s extraordinary economic rise.
But Yi says that now seems unlikely. According to him, “By 2031 to 2035, China will outnumber the United States on all demographic measures and in terms of economic growth.”
pressure on pensions
The current average age in China is 38 years. As the population ages and birth rates continue to fall, there are growing concerns that Chinese workers will one day be unable to support those who are already retired.
The retirement age in China is 60 for men and 55 for women. Today, people over 60 make up a fifth of the population.
In Japan, the aging of the population is one of the fastest in the world, and about a third of the population is 65 years of age or older.
“Population aging is not unique to China, but the pressure on China’s pension system is much greater,” says Oxford Economics economist Louise Loo.
In her opinion, the number of pensioners is already greater than the number of contributors, which has led to a decrease in contributions to pension funds since 2014.
The country’s pension system is administered at the provincial level. People pay as they work that is, contributions from active workers pay pensions for retirees.
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The aging of the Chinese is affecting the country’s economy
Aware of the system’s difficulties, Beijing set up a fund in 2018 to transfer surpluses from the wealthiest provinces, such as Guangdong, to places with deficits.
But in 2019, a report by the Chinese Academy of Social Sciences predicted that the country’s main pension fund would be exhausted by 2035 due to the reduction in the number of active workers.
Last year, China launched its first private pension program in 36 cities, allowing citizens to open retirement accounts with banks to purchase investment products such as mutual funds.
However, according to Loo, it is unclear whether many Chinese, who normally invest their savings in more traditional ways such as buying real estate, would switch to private pension funds.
These problems are not limited to China. In Japan and South Korea, too, populations are aging and the labor force is declining.
Yi says Beijing is on the verge of copying Japan’s childrearing cost reduction policy, but adds that “China ‘gets old before it gets rich’ and doesn’t even have the financial resources to fully follow Japan’s path consequences”. .
An aging population is not Beijing’s only concern. There is also a growing online movement among young people called “Legen”. This movement calls on workers to reject the struggle for career success and promises freedom from the pressures of life and work that exist in fastpaced capitalist society.
Added to this is the high level of youth unemployment, which peaked in July 2022 at 20% among 15 to 24 year olds.
“The workers are the flour, and the pension system is the technique of making bread,” explains Yi Fuxian. “Without enough flour, it is impossible to bake bread in large quantities, even with the best breadmaking techniques.”