The National Bureau of Statistics announced last month that 9.56 million people were born in China in 2022, while the death number registered 10.41 million. The country’s population declined for the first time in six decades. What were the major causes of the decline?
There are two categories of rates for demographics. The first category contains the rate of birth or death, and they are crude rates, subjecting to the influence of population age structure. The other category is net rate, such as fertility rate or life expectancy. For instance, the number of replacement fertility means you need to have two children per couple to keep the population at the replacement level and keep both sides stable. As for life expectancy, it is calculated based on mortality by age.
Take a look at the influence of the population’s age structure on crude rates. Even though each couple has fewer than two children, if there are a lot of young people in the population, the birth rate is still high. In addition, when there are a lot of young people, the death rate will also be low. However, if there are a lot of people in old age, because they have higher death rate, the country will have a lot of decline in population. The birth and death numbers are the products of the net rates and population age structure.
Last year is the point where the young population that used to give a lot of birth started to drop. In addition, in the future, people’s life expectancy will continue to improve, and more people are going to be in old age.
Last year, there was an excess of death over birth because of the long-term trend of low fertility and the fact that the population is getting older. Right now, China has had a low fertility rate for more than three decades. The estimated number of children per couple is at about 1.5. This is a number that is below what's required to sustain a population size.
What are the reasons for China’s low fertility rate?
There are several reasons responsible for the low fertility rate. First, there is the high cost of living, including the high cost of housing, raising children, education, and other expenses. Second, gender inequality is another reason. We need to look at this more socially or sociologically, to see where the burden of childbearing falls. Not only in China, but in most of the world, the burden of childbearing falls on women. It's so much harder for women to have equal footing as men, in society, in business, in politics, and in social affairs. There is a high opportunity cost for women to raise children, as they are responsible for spending time taking care of the children. This is often ignored by people, as they think the reason for low fertility rate is just related to the high cost of raising a child. However, women’s responsibility for taking care of children is not something money can buy.
The third reason is the one-child policy. China had a one-child policy for three and a half decades. The Chinese culture before the one child policy was always to have more children. And in China, as well as in other parts of the world, the ideal is to have two children: one boy and one girl. Now, in China, this is not the same, because of the one child policy, the idea of family is changed in China to having one child. A lot of parents or other young people, people who are only children themselves, feel that having only one child is normal. They used to be brought up as an only child, so they feel one child is enough.
In addition, for children who are the only child in their family, they already have several responsibilities, such as taking care of their parents and grandparents. If they have more than one child themselves, they are going to have a lot of responsibilities, both for the older and the younger generation. They’re the sandwich generation in the future.
In your article, you explained several benefits of population decline, such as expanded education opportunities, increased average life expectancy, and reduced humanity’s ecological footprint. How could the Chinese government adjust the policies and better utilize the benefits?
One thing the government could do is promote gender equality. For the last 10 years, China now has not only the most educated and young generation in its history, but also more women in colleges than men. However, if you look at the gender inequality structure, are women given equal opportunities to be leaders or to be creative?
In addition, the government can address the migrant issue in China. There are over 200 million migrants in large Chinese cities, but they do not have the same entitlement to benefits as the urban residents in terms of their living, their next-generation education, and childbearing. If migrants cannot settle in the cities, their parents cannot be around. In this way, they don't have childcare. Also, migrants are not making investments for themselves, or businesses for their children in the cities if they cannot stay for long.
Last, the retirement age in China could be postponed because they're awfully early. Right now, life expectancy has increased to 78 in China. A lot of people live longer life. So, they can be offered more opportunities to contribute to society. They don't need to work as workers but can do volunteer and caring work. For instance, in Japan, many elders drive taxis. If you look at the United States, Biden is almost 80 but is still running a country.
The Chinese government has adopted different policies for boosting the fertility rate. For instance, in Shenzhen, couples with more than three children are eligible for a total cash allowance of 19,000 yuan (US$2,800) until the child turns three years old. Do you think such pro-natal policies will be effective in increasing the country’s population?
My answer is definitely no. As we’ve discussed earlier, the high cost of living, including housing, childcare, education, and other spending are all factors. $2,000 per year is not even going to make a difference in the high cost of living. Besides, the main reason for low fertility is not just because of the high economic cost.
The “one-child” policy has often been blamed for China’s declining birth rate. Is there a scholarly consensus on the impact of this policy on China’s demographics?
There is not much consensus on the impact of the policy, since the one-child policy is too extreme. Starting in early 1990s, fertility dropped to below two. That's when young people in the countryside couldn't move into cities, and the Chinese economic growth took off. While the one-child policy was in place, low fertility was also largely driven by young people getting an education, and moving to cities, even villages. In 2016. China lifted the one-child policy. With the exception for one year, the birth number has been going down year after year. The one-child policy was very harmful, but its role was also overclaimed.
According to the Chinese state media, China is already approaching a “moderately aging scenario”, in which 20% of its population is aged 60 and older. What are the most important consequences of population aging for Chinese society and the economy? What can international experience in dealing with an aging society teach China?
The world has never lived in an aging society as we are entering now. Therefore, there's really not much to learn as this is a totally new territory. However, Japan has had an aging population for over 30 years, and its population has declined for almost more than 10 years. The quality standard of living in Japan has not dropped.
China is going to age much faster than Western countries, which took a long time to age. There are a lot of challenges, but we definitely need to adapt to a different economy. There are many possibilities that we can still live in a society that offers opportunities or well-being benefits to everyone.
The Chinese government will encounter a serious challenge in funding healthcare and pension in an ageing society. Last week, the Wuhan Government started to decrease the individual amount of healthcare money, leading to over 10,000 elderly people protesting in the streets. This is only the beginning. With a large population that’s also getting older, where does the pension fund money come from? Where does the healthcare money come from?
China has had a very lucky three to four decades of rapid growth and that growth has slowed down for many reasons. So where would the government get the money to pay for these? The Chinese government rests its legitimacy on economic growth. If they cannot deliver that, they're going to face a legitimacy crisis. Therefore, the pressure will be on the government.
The government can take some longer-term reforms. Right now, the Chinese healthcare system is highly inefficient and there is a lot of waste. The retirement system can be changed. The capital market system can be made more effective, so people can invest their money in the stock market. But from what we know now is that these longer-term and more difficult reforms have always been postponed.
Why do they postpone it?
It's human nature. It's the nature of political organizations to procrastinate unless they're facing an existential crisis. Look at how the one-child policy ended. Scholars, like myself, have been calling for the policy to stop since at least the early 2000s. It took 15 years for the government to lift the policy. Prior to 2022, China's population was still growing. Therefore, it’s very easy to think that the population is still growing. However, we know from 30 years ago that this day would come.
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