Name: How can China solve its population crisis?
Uploaded: 2021-06-17
Duration: 6 min 7 s
Description: Low fertility rates and an aging workforce are reshaping China's demographics and threatening its economy

Low fertility rates and an aging workforce are reshaping China's demographics and threatening its economy

How can China solve its population crisis?

International

China's National Bureau of Statistics has just released the data from their 2020 census Census data revealed a population growth rate of 5.38% between 2010 and 2020. This is the slowest rate of population growth seen in decades. Only 12 million newborns are recorded in 2020 a level not seen since the devastating famine of 1961. The big news in China's census was really the step decline in china's total fertility rate. Before uh we were looking at something in the order of 1.7 child for a woman throughout her lifetime, that is the total fertility rate. Uh now the release indicated more something like 1.3, some people have speculated China would already show a decline in population over the past 10 years. That has not happened. There's still growth, China is still growing with about 0.5 percent per year population. But as well turned by the end of this uh this decade on current trends and then china will show declines. But it's not just the population numbers that matter. Demographic structure matters as well as the census shows that china's population is also getting older. This is brought about by two main changes. The first is very positive is that mortality is declining. That means that people are living for much longer, which of course comes about to improve health and um medicine and so on. But then the other change, which of course gets a lot of attention is that fertility has been falling and and has been low for many years now. So you have aging from if you imagine the population pyramid, you have aging from above which people living for longer and then aging from below, which is there are just fewer Children being bought. China is already concerned about decreasing population growth. It's quite likely that china's working age population will continue to this will take out the so called demographic dividend from china and will require more capital investment and positivity growth in order to compensate for this. Otherwise, china's long term potential government growth stuff. Beijing recently announced that they will allow all couples to have three Children. This follows a move in 2016 when they relax the one child policy allowing some couples to have two Children. This led to a slight increase of birds which ultimately fizzled out a few years later. There's a couple of factors. Um uh the the short answer is people have a lower desire for babies. Where does that come from? Important people marry later? Some people do not marry at all anymore, and some people feel that one child uh is already so much of an investment in terms of time, in terms of costs, in terms of getting The Children in the right school that they do not want anything more. And even the abolition of the two child policy, frankly, it doesn't seem to matter that much. The factors that lead people to choose. Only 1.3 child are much stronger than than this, this stealing on the number of Children. But there's a number of things that governments around the world has done to to increase population growth. And there's been if you are modest, modest the results of those policies, one is better childcare incentives like tax cuts, subsidies and broader social support could encourage families to have more Children. China's latest five year plan includes measures on increasing the amount of childcare, but it may not be enough. Even if the chinese government has a child care policies in place, there are still problems with the nature of employment being too demanding when employers expect absolute loyalties of the job rather than a time for family where they expect very long work hours, sometimes unpaid as well. Then there is a huge conflict between work and family. What may be easier is increasing china's labor productivity, its digitalization which may allow the country to produce more with fewer people, is already running ahead of most other asian economy. Another data point in the census increased education with 100 million new university graduates over the past decade. I think china has a good track record in promoting growth. 70 years, better education and local people were facing entirety. And chinese company has also shown themselves to be adopted in innovation and able to leverage technology and in the neighborhood. I think what china, most of the different options to compensate for issuing labor force are working age population, the most Waibel wages to look into improving the neighborhood? The question of how china manages the demographic transition is critical for the world economy. Will it be able to reverse the decline in fertility? Will it be able to offset a decreasing working age population with increased labor productivity? Or is the upcoming economic adjustment inevitable, rather than having to kind of come with some very rushed policy response to this? The biggest thing with china is doing just to realize, and it has done that it just realized that it is a different demographic system, different demographic paradigm and the economy and society and culture just needs to adapt to this new demographic reality.