Commentary on Political Economy

Monday, 10 May 2021


China’s Census Highlights a Looming Population Problem 

After weeks of delay, China issued census data showing a minuscule rise in its population in 2020 

A newborn baby is fed at a hospital in China’s Anhui province in April. 

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China said its population hit 1.41178 billion in 2020, eking out a tiny rise from 1.4005 billion for the previous year, underlining how the world’s most populous nation is going to have to face its demographic challenges sooner than expected.

The number indicated that China’s population has only gone up by 72 million since the last census, in 2010, which is likely to increase pressure on Beijing to ease remaining birth restrictions.

China’s National Bureau of Statistics only released the total population number without any details on births or deaths in 2020. In recent months, other measures have indicated that fewer babies were born in the country in 2020 than in any year since 1961, when China was suffering mass starvation. Meanwhile, the population of older Chinese continues to balloon.

The data showed a sharp rise in the percentage of Chinese aged 60 and above, to 18.7% of the population from 13.3% in 2010. 

The portion of Chinese aged between 15 and 59 stood at 63.35% in 2020, down from 70.1% in 2010.

The pandemic’s effect on the population count was unclear. While China quickly reined in the spread of infections within its borders, demographers say coronavirus concerns probably contributed to suppressing births.

China’s demographic situation has in a short time moved to the forefront of Beijing’s economic concerns. The trend of fewer young people to replace a growing number of retirees has been clear for years but dealing with it has largely been kicked down the road as leaders have focused on mounting debt, a trade war with the U.S. and reining in a once freewheeling private sector. 

Now, Beijing can no longer ignore the demographic shadow over long-term growth. Pension shortfalls in the country’s northeastern Rust Belt have forced the central government to ask state-owned enterprises as well as wealthier and younger provinces in the south to help out with the pension pool.

Customers inspect fruit at a market in China's Liaoning province on Tuesday. 


Births will probably drop further in the coming years as the three decades of China’s one-child policy have resulted in a shrinking number of childbearing women, said Yi Fuxian, a U.S.-based researcher and a longtime critic of China’s population policies.

“What’s disastrous for China’s economy behind the data is a fundamental demographic shift,” Mr. Yi said.

The aging of the population is expected to be a major drain on the country’s savings. And just when China is turning to consumption as a growth driver, older people worried about pension payouts—and with just one child to help them in their old age—are likely to become reluctant to spend.

Leaders have long pointed to automation as one thing that will help offset declines in the working-age population, which has been shrinking since 2012, according to official data. But economists have expressed doubt about that strategy. In March, researchers at China’s central bank released a paper calling for a much stronger response to the country’s dire demographic outlook. “We must realize that education and technology advancement can hardly compensate for the decline in population,” it said.

The census results were released after weeks of delay. The statistics bureau had said it would release the data in early April but then said it needed more time. After the Financial Times, citing people familiar with the data, reported that Beijing would post a population decline for the first time in decades, the statistics bureau—in a one-sentence statement on April 29—said the population grew last year and that the census would have more details.

A research report released late last year by the China Population and Development Research Center, a government think tank, predicted that China’s population will peak in 2027 at 1.417 billion. That is three years earlier than what Beijing had predicted in 2017. It isn’t clear whether further revisions will be necessary after the census results. 

China is still expected to overtake the U.S. as the world’s largest economy, but some economists warn it may not be able to hold on to that spot if the number of workers keeps shrinking. Unlike the U.S., which also has seen a drop in births, China doesn’t rely on immigration to help replenish the workforce.

In 2016, China started allowing all couples to have two children, but the baby boom that policy makers had hoped for didn’t materialize. The one-child policy helped create a mind-set of focusing all of a couple’s resources on one child and many families feel they simply can’t afford a second one.

And the rare couple that wants more than two children runs the risk of punishment as long as China’s birth restrictions remain on the books.

A 33-year-old former local-government worker in Hangzhou, who preferred using only her last name, Li, is suing her employer, which let her go four months after she gave birth to a third child last year. Chinese law bans employers from firing employees during the months immediately after a child is born. 

Early this year Ms. Li resorted to a labor-dispute arbitrage board in Hangzhou, which ruled that because she had violated family-planning regulations, she wasn’t covered by maternity-leave protections.

In a statement posted on the Weibo social-media platform, Ms. Li said she felt like “in our country, giving birth can be a sin.”

In recent years, some local authorities have started to quietly allow families to have a third child without the usual repercussions, parents and demographers say.

Even officials and researchers who have long supported China’s family-planning policies are now shifting their rhetoric to stress the need to boost births. 

In 2015, after China said it would lift the one-child policy, Wang Peian, then a deputy director of China’s family-planning commission, called family planning a “fundamental state policy” that China should adhere to for a long time. Two years later, Mr. Wang disputed that China faced a risk of a population shortage. “Not now, not in 100 years,” he said at a news conference where he predicted between 17 million and 19 million births a year through 2020. 

Instead, after a brief rise to 17.86 million in 2016, births fell in each subsequent year. The statistics bureau reported 14.65 million births in 2019.

In April, Mr. Wang, now a member of the Communist Party’s political advisory body, called for a “significant adjustment of population policy” in favor of measures to encourage births, according to a newspaper run by the advisory body.

Then in March, the central bank published its paper saying the lifting of birth restrictions can’t wait. “If we have any hesitation in [changing course] we’ll miss the precious window to change the course of population policy,” the central-bank researchers wrote.

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