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Analysis: Shrinking population threatens China socially, economically and politically

Through much of recorded human history, China has boasted the largest population in the world — and until recently, by a significant margin.

So news that the Chinese population is now in decline, and will sometime later this year be surpassed by that of India, is big news — even if long predicted.

As a scholar of Chinese demographics, I know that the figures released by the Chinese government on Jan. 17, showing that for the first time in six decades, deaths in the previous year outnumbered births, is no mere blip.

The only previous year of shrinkage — 1961, when an estimated 30 million Chinese died of starvation as a result of the Great Leap Forward economic failure — represented a deviation from the trend.

The shrinkage of 2022 represents a pivot rather than a deviation. It marks the onset of what is likely to be a long-term decline.

By the end of the century, the Chinese population is expected to shrink by 45%, according to the United Nations. And that is under the assumption that China maintains its current fertility rate of around 1.3 children per couple, which it may not.

This decline will spur a trend that already concerns demographers in China: a rapidly aging society. By 2040, around a quarter of the Chinese population will, it is predicted, be over the age of 65.

That would represent a seismic shift. It would inflict huge real and symbolic impacts on China in three main areas:

Economic

In the space of 40 years, China has largely completed a transformation from an agrarian economy to one based on manufacturing and the service industry. This has been accompanied by increases in the standard of living and income levels.

But the Chinese government has long recognized that the country can no longer rely on the labor-intensive economic growth model of the past. Technological advances and competition from countries that can provide a cheaper workforce, such as Vietnam and India, have rendered this old model largely obsolete.

This historical turning point in China’s population trend serves as a further wake-up call to move the country’s model more quickly to a post-manufacturing, post-industrial economy. Clearly, an aging, shrinking population does not fit a labor-intensive economic model.

As to what it means for China’s economy, and that of the world, population decline and an aging society will certainly provide Beijing with short-term and long-term challenges. In the short term, it means there will be fewer workers able to feed the economy and spur further economic growth. In the longer term, it means a growing post-work population will need costly new support.

It is perhaps no coincidence then that 2022, as well as being a pivotal year for China in terms of demographics, also produced one of the worst economic performances the country has experienced since 1976.

 

Social

The rising share of elderly people in China’s population is more than an economic issue. It will also reshape Chinese society.

Many of these elderly people have only one child, due to the one-child policy in place for three and a half decades before being relaxed in 2016.

The large number of aging parents with only one child to rely on for support will likely impose severe constraints. Elderly parents will need financial, emotional and social support for longer as a result of extended life expectancy. It will also impose constraints on the children, forcing them to fulfill obligations to their careers, provide for their own children and support their elderly parents simultaneously.

Responsibility will fall on the Chinese government to provide adequate health care and pensions. But unlike in Western democracies, that have by now had many decades to develop social safety nets, the speed of the demographic and economic change in China has left Beijing struggling to keep pace.

As China’s economy underwent rapid growth after 2000, the Chinese government responded by investing tremendously in education and health care facilities, as well as extending universal pension coverage.

But the demographic shift was so rapid it meant that political reforms to improve the safety net were always playing catch-up. Even with the vast expansion in coverage, the country’s health care system is still highly inefficient, unequally distributed and inadequate given the growing need.

Similarly, social pension systems are highly segmented and unequally distributed.

 

Political

How the Chinese government responds to the challenges presented by this dramatic demographic shift will be key. Failure to live up to the expectations of the public in its response could result in a crisis for the Chinese Communist Party, whose legitimacy is tied closely to economic growth.

Any economic decline could have severe consequences for the party. It will also be judged on how well the state is able to fix its social support system.

Indeed, there is already a strong case to be made that the Chinese government has moved too slowly.

The one-child policy that played a significant role in the slowing growth, and now decline, in population was a government policy for more than three decades.

It has been known since the 1990s that the Chinese fertility rate was too low to sustain current population numbers. Yet it was only in 2016 that Beijing acted and relaxed the policy to allow more couples to have a second, and then in 2021 a third, child.

This action to spur population growth, or at least slow its decline, came too late to prevent China from soon losing its crown as the world’s largest nation. Loss of prestige is one thing, the economic and political impact quite another.

From The Conversation, an online repository of lay versions of academic research findings found at https://theconversation.com/us. Used with permission.

Comments

JWC

Soylent Green is...?

sbagwell

Soylent Green - Wikipedia
https://en.wikipedia.org › wiki › Soylent_Green
Soylent Green is a 1973 American ecological dystopian thriller film directed by Richard Fleischer, and starring Charlton Heston, Leigh Taylor-Young, ...
Box office: $3.6 million (rentals)
Produced by: Walter Seltzer; ‎Russell Thacher‎
Starring: Charlton Heston; ‎Leigh Taylor-Young‎; ...‎
Based on: Make Room! Make Room!; 1966 no...
‎Soylent (meal replacement) · ‎Make Room! Make Room! · ‎Harry Harrison (writer)

JWC

Sbagwell:

Good memory.
I've actually used that line while pretending to do a drunken, Chuck Heston impersonation in a bar. Interesting reactions.

Contrast that dystopian image of the future that was almost universally embraced by the self anointed elites with the current reality that almost every industrialized country now has below replacement birth rates and almost all developing countries have plummetting birth rates. This is prior to the Covidvirus pandemic being exploited to justify mass vaccinations which has resulted in yet another, profound drop in birth rates. Only a few folks such as myself who could do the math recognized that the population passed the inflection point during the 1970s and would peak well below ten billion. Of course the contrarians who have actually checked the math on global warming theology are also ignored. Since Biden's drill nowhere, drill never energy policies have triggered a war in Ukraine that will almost certainly escalate to nuclear weapons, it probably will not matter.

Jean

I find that taking a walk in the woods really helps. The sounds of birds chirping, a stream flowing, and tons of gorgeous ferns, mossy trees,....so green and fantastic!

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