Demography of China - Free Essay Sample

Introduction

China is the most populated country globally, with over 1.4 billion people living within its borders (Worldometer). The huge population has been one of China’s biggest economic resources by providing cheap labor, which has enabled the country to become the world’s manufacturing capital. However, while the Chinese economy continues to realize significant growth as hundreds of millions of people move out of poverty, the country faces a demographic problem that can derail the country’s progress or even cause it cut back on the progress that it has made over the past four decades. The Chinese population is getting older, with the median age currently standing at 38.4, which is eight more years than it was at the turn of the century (Worldometer).

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While 38 is not a bad figure, the decreasing number of births and increasing life expectancy means that the country’s median age is expected to continue rising over the next two decades. It will be the first country in the world to support hundreds of millions of elderly citizens. The number of young people may not be enough to support the elderly, especially in a country like China, which lacks social safety nets. Therefore, this research paper will investigate the impact of the Chinese aging population issue, the factors that led to it and recommend the probable course of action.

Impact of Chinese Aging Population Issue

China is one of the countries that has benefited from the demographic bonus, alternatively referred to as demographic dividend to ensure rapid economic growth. Demographic bonus refers to the growth potential that may emanate from changes in the population structure where most of the country’s population is in the working-age group (Nasir and Tahir 104). The Chinese economy has benefited from that demographic shift as the hundreds of millions of young, energetic peasants moved out of the rural villages to cities to match the demand for labor in the manufacturing and service sectors (Peng 583). These demographic changes have allowed investments and savings to grow in the country. However, the country is on the brink of another demographic shift that could turn the tide on the country’s economic success.

Fewer Working Age Group

Fewer working-age people means less productivity. The working-age group is the backbone of any advanced economy. They provide vital labor required to produce goods and services, earn an income that goes into payment of taxes and support the elderly population (Chen et al., 168; Zou and Dietermar 317). That means that a shrinking working-age population will reduce the amount of labor available for manufacturing. Through the transition from an agriculture-based to an industry-based economy, China became an economic superpower. A large amount of labor from rural China sustained manufacturing and service sectors.

Reduced working-age populations will also lead to decreased investments in the country due to the high labor cost. Part of China’s rapid economic growth was the high amount of cheap labor available (Peng 585). The cheap labor encouraged investors to set up factories in the country because they want to reduce their production costs. Having a shrinking working-age population leads to a high demand for labor, which causes an increase in wages. The Chinese aging issue will cause the country to lose its appeal to international investors and even local ones who will prefer the neighboring countries with more working-age people and lower labor costs.

A reduction in the working-age population ratio translates to an increase in the country’s number of dependents. The dependent population refers to those who are too young or too old to work and earn an income. These portions of the population typically depend on the working-age population to sustain them. In a healthy economy, the number of working-age people should outnumber the dependents to enable real growth. However, if the number of dependents is higher than the working-age group, the country will experience reduced savings in most of its population, leading to decreased investments. It will also reduce consumerism in the country because of reduced disposable income.

Finally, the government revenues will reduce, and budgeting strained because of a decrease in the working-age population. Shifting demographics will mean the tax collection from working people is being used to support a larger population regarding pensions and healthcare. According to Peng, “the proportion of the oldest old (i.e., 75 years and over) will increase substantially within about 20 years. That will put huge pressure on pension and health care systems” (586). The country’s social safety nets may end up being unsustainable because the income tax collection will have stagnated while the expenses incurred in supporting the elderly will have increased.

Factors That Lead to Aging Population Issue

One child policy is one of the main factors that contributed to the Chinese aging population problem. In the late 1970s, the Chinese Communist Party undertook one of the largest social experiments in human race history, seeking to reduce its fertility rate (Huang 1). What followed was a drastic decrease in the country’s fertility rates that slowed down the population growth rate. The one-child policy restricted a significant portion of Chinese couples to having one child. Despite the removal of the one-child policy in 2016, the damage had already been done, and it would take several decades before China can replenish its fertility rates. The one-child policy meant that there were not enough children born in China to replenish the aging community members, which led to the aging problem.

There were also vigorous family planning campaigns conducted by the government before and after implementing the one-child policy. Chen and Liu said, “Preceding the drop of fertility in the 1970s was also the consistent and sustained decline of mortality, which was a direct consequence of strong government health intervention programs” (157). The Chinese government thought the country needed to reduce the birth rate to ensure sustainable growth, and they embarked on that family planning campaign. The campaigns would lead to behavioral changes among the Chinese population that would reduce their fertility rates.

Another factor was the rapid decline of mortality rates in the country. The decrease in Chinese mortality rates gained worldwide recognition because it had rapidly increased its life expectancy with a “poor non-industrialized economy” (Chen and Liu 158). The country’s ability to achieve such a feat was facilitated by the government’s mass public health campaigns aimed at parasitic and infectious diseases. According to Chen and Liu, some of the efforts included “environmental cleanups, expanded vaccination programs, setting up Hygiene and Anti-Epidemic stations, and introducing locally trained doctors that moved around rural China dealing with hygiene matters” (158). These measures worked to reduce the country’s mortality rate but set the country on course to have an aging problem.

Finally, socio-economic factors such as increased standards of living, more economic opportunities for women, improved access to education, and awareness on financial matters (Peng 582). The country’s growth and stability have lifted hundreds of millions of Chinese citizens out of poverty, hence causing an increase in living standards within the country. There is an inverse relationship between income levels and children sired such that the wealthier classes of the population tend to sire less offspring (Scholz and Seshadri 22). Simultaneously, improved access to education ensures that most of the population spends their younger years in school and hence end up prioritizing career progression over starting a family.

Probable Courses of Action

Despite the current demographic trend in China, there are still some measures that the country can take to reduce population aging and mitigate its impacts. The first action is to boost the fertility rates in the country. The government can move to introduce greater incentives and protection to young couples to encourage reproduction. Giving women longer maternal leave and job guarantees will enable them to take some time off to sire children, as is seen in some developed countries (Department of Economic and Social Affairs 2). Women tend to forego giving birth and raising a family for fear of derailing their career progression. The government should adopt more progressive policies that protect women’s careers and allow them to raise a family.

Another probable course of action is for the country to start implementing pro-immigration policies. Pro-immigration policies have helped protect other countries such as the US from the population aging problem because it is always replenishing its working-age population through immigrants (Banister et al., 28). Immigration is one of the best ways of sustainable population replenishing and ensuring the economy does not suffer from reduced productivity, especially in highly skilled sectors. Most immigrants tend to be in the working age, hence providing the country with the needed labor, and taxes in the future.

Conclusion

China is currently facing an aging population problem that threatens to derail its path to economic success. The majority of the Chinese population is currently in the working-age group, but that category is rapidly shrinking. A shrinking working-age population leads to low productivity and revenue collection. The Aging problem in the country is a result of the government policies that sought to reduce the high fertility rates in the country by imposing the one-child policy and aggressive family planning campaigns. However, the country can solve the demographic problem by introducing policies that encourage reproduction and adopting pro-immigration policies.

Works Cited

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Department of Economic and Social Affairs. Population Facts. United Nations, 2017.

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Nasir, Jamal Abdul, and M. H. Tahir. “Prolonging the Native Demographic Bonus: An Empirical Evidence.” International Journal of Business and Social Science vol.2, no.7, 2011, pp.107-110, http://www.ijbssnet.com/journals/Vol._2_No._7%3B_Special_Issue_April_2011/12.pdf. Accessed 10, December, 2020.

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Scholz, John Karl, and Ananth Seshadri. “Children and household wealth.” Michigan Retirement Research Center Research Paper No. WP, no. 158, 2007, pp. 1-39, https://deepblue.lib.umich.edu/bitstream/handle/2027.42/57570/wp158.pdf?sequence=1. Accessed 10, December, 2020.

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Zou, Xiaolong, and Say Dietermar. China’s Ageing Population: Challenges and Implications. Oita, Ritsumeikan Asia Pacific University, 2014.