China’s population decrease

When most people think of China, the vast population of China may come to mind. However, China’s population has followed a drastic trend downward and in 2022, China’s population declined for the first time in around 60 years. According to CNN “ The population decline is partially a result of China’s one-child policy, which for more than 35 years limited couples to only having one child. Women caught going against the policy were often subject to forced abortions, heavy fines, and eviction.” And according to Reuters “The number of Chinese women of childbearing age, which the government defines as aged 25 to 35, fell by about 4 million.”

What does this mean for China? The elderly now make up 17.5% of the population, and the workforce is shrinking, placing tremendous pressure on the younger generation. According to CNN “ Some experts warn the country could be heading down a similar path to Japan, which entered three decades of economic stagnation in the early 1990s that coincided with its aging demographics.” And so, as the supply of workers begins to shrink, production growth will need to start picking up the pace to sustain the economy’s expansion rate.

So, what will happen to the rest of the world? Reuters said that due to the shrinking of the labor force, a downturn in manufacturing would further the high prices and high inflation in the U.S. and Europe. And according to CNN “The pandemic has illustrated how China’s domestic problems can affect the flow of trade and investment, with its lockdowns and border controls disrupting supply chains. A slowing Chinese economy would drag on global growth and threaten China’s ambitions of overtaking the United States as the world’s largest economy.” And China looks likely to lose its place as the number one most populous country in the world to India.

What is the government doing about it? The Chinese government has been ramping up efforts to have a more prominent family, including a multi-agency plan released last year to strengthen maternity leave and offer families tax deductions and other perks. According to CNN the Chinese leader, Xi Jinping, pledged in October to “improve the population development strategy” and to ease economic pressure on families. And some places are even offering cash incentives to encourage more births. CNN said “ One village in southern Guangdong province announced in 2021 it would pay permanent residents with babies under 2 and a half years old up to $510 a month – which could add up to more than $15,000 in total per child. Other places have offered real estate subsidies for couples with multiple children.” Experts have been saying that “ To encourage childbirth, you must first solve the worries of young people.”

“[We will] establish a policy system to boost birth rates, and bring down the costs of pregnancy and childbirth, child-rearing, and schooling,” Xi said. “We will pursue a proactive national strategy in response to population aging, develop elderly care programs and services, and provide better services for elderly people who live alone.”

Source:

https://www.cnn.com/2023/01/18/china/china-population-drop-explainer-intl-hnk/index.html#:~:text=The%20country%27s%20population%20fell%20in,Tuesday%20briefing%20on%20annual%20data

https://www.reuters.com/world/china/chinas-population-shrinks-first-time-since-1961-2023-01-17/