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Has China’s Population Peaked?

China is allowing couples to have three children and vows more supportive measures in response to the dramatic decline in the fertility rate revealed in its latest census

By NewsChina Updated Aug.1

Two seniors with their grandchildren at a department store in Beijing, December 25, 2014. Many retirees take care of their grandchildren, forgoing their own retirement

On May 31, following a meeting held by the Political Bureau of the Communist Party of China (CPC) Central Committee, the Chinese leadership announced that it will allow couples to have up to three children, a major shift from the existing two-child policy.  

The move is widely perceived as a response to the national census data released on May 11, which showed a worse than expected aging problem. Held every 10 years, the census data is important for policy planning.  

Census Data 
Conducted in 2020, the seventh national census showed that seniors aged 65 and above account for 13.5 percent of the total population, almost double the rate in 2000 (6.89 percent) and about 5 percent higher than ten years ago in 2010 (8.87 percent).  

According to an estimate from the Shanghai Academy of Social Sciences (SASS), the number of those aged 65 and above will account for 30 percent of China’s population in 2050, which would rank China alongside the world’s most aging countries such as Japan, South Korea and Singapore.  

By contrast, China’s labor force, those aged between 16 and 59, has shrunk by 7 percent, or some 40 million within the last 10 years. One bright spot in the data is the proportion of children, or those aged 14 or younger, which increased slightly from 16.6 percent in 2010 to 18.0 percent in 2020. However, the trajectory of the annual number of new births in more recent years shows a worrying trend. 

To boost the number of births, China allowed all families to have two children in 2016, the first major change in its family planning policy of 1979. The policy led to a surge in the number of births in the subsequent two years, increasing from 16.55 million in 2015 to over 18 million and 17 million in 2016 and 2017.  

But the policy’s effect quickly subsided as the number of births dropped to 15.23 million and 14.65 in 2018 and 2019. In 2020, the figure further fell to about 12 million in 2020, 22 percent lower than the previous year.  

In the past 10 years, average family size decreased from 3.10 people in 2010 to 2.62 in 2020. In 2020, China recorded a fertility rate of 1.3, well below the roughly 2.1 needed for replacement level.  

In total, the population of the Chinese mainland in 2020 amounted to 1.412 billion, 72 million more than the 2010 census.  

Accounting for 18 percent of the global population, China remains the most populous country in the world, but its population has been growing at a slower pace, an average of 0.53 percent each year, compared to an annual average of 0.57 percent in the 2001-2010 period and 1.07 percent from 1991-2000.  

The census data serves to refute a report by newspaper the Financial Times which had cited a specific source and claimed that China’s population had already peaked and had in fact fallen in 2020.  

However, the data does indicate that China’s population will peak much earlier than previously expected.  

The United Nations predicted the population living in the Chinese mainland would peak by 2030. But according to a 2020 report released by the Evergrande Research Institute, a Shenzhen-based think tank, the country’s population will peak within five years at around 1.42 billion, which means that China could soon be surpassed by India, which had an estimated population of 1.38 billion in 2020, according to data website Statista.  

Two seniors in Beijing, April 29, 2021. The results of the latest national census, conducted in 2020, show that China’s population is aging fast

‘Integral’ Approach 
Few believe that the new relaxation in birth restrictions will be enough to address China’s aging problem. “The impact of further lifting birth restrictions will be minimal,” said Zhang Junni, associate professor of statistics at Peking University.  

“The declining desire of China’s younger generations to have children, or even to get married is not driven by policy restrictions, but by a variety of factors, including the surging costs of living, childcare and education, as well as high stress levels from work,” Zhang said. China needs a more refined and targeted policy package to address these issues, Zhang added.  

At the Political Bureau meeting chaired by Chinese President Xi Jinping on May 31, the country’s leadership pledged to adopt “complementary policies” regarding the change in family planning policy, with “integrated consideration” regarding issues related to marriage, childbirth, childcare and education.  

It also pledged to improve prenatal and postnatal care services, establish a universal childcare system, promote education equity with the supply of high-quality educational resources, and lower overall family spending on education. The government will enhance tax and housing policies and safeguard the legal rights of women in employment.  

While the meeting did not offer detailed information on these measures, it marks a major policy shift in China’s family planning policies. Some measures appear to be already underway.  

Following a government meeting in March in which Xi warned that the surge in after-school tutoring was putting immense pressure on children and parents alike, China’s regulators launched crackdowns on the booming private tutoring industry.  

On June 1, China’s top market regulator announced it would impose a maximum fine of 36.5 million yuan (US$5.7m) in total on 15 off-campus training institutions over illegal activities such as false advertising.  

The Ministry of Education is also reportedly drafting new rules that would ban oncampus academic tutoring classes and onand off-campus tutoring during weekends, in an effort to reduce living costs and stress on families.  

Household Registration 
But for many experts, the problems Chinese families face regarding childcare and education go far beyond tutoring. According to Liu Guoen, a professor of economics at Peking University, China needs to address some of the institutional barriers that deter couples from having children, such as the household registration system, known as the hukou system. This links people to their place of birth for social benefits such as education, healthcare and social security.  

According to the census data, in 2020, 902 million people, or 63.9 percent of China’s population live in urban regions, up from 49.7 percent in 2010. At the same time, nearly 500 million, or 35 percent of China’s total population are considered “migrant population,” – those who live and work in places other than their official household registration. The term is broadly used in China, and includes low-income workers such as laborers who keep links with their home towns or villages, and may move around for work, or middle-class workers who moved for a permanent job or higher education to a new city, perhaps even buying property there.  

Under the household registration system, public education funds are appropriated based on the number of locally registered households, and people who work in places other than where their households are registered are often denied access to local public childcare and education resources. “It is a major deterrent for migrants to have children,” Liu said.  

Liu believes that compared to addressing the changes in cultural norms, removing the institutional barriers posed by the household registration system to over one-third of the country’s population will have more effect in boosting the fertility rate.  

In Shenzhen, known as “China’s Silicon Valley” or “the city of migrants” which attracts talented people from all over the country, there has been a shortage of primary school spots for many years. Local authorities estimated the shortage of places in the city’s primary school system amounted to at least 45,000 in 2020.  

Between 1979 and 2019, the number of primary school pupils in Shenzhen increased from 47,000 to 1.07 million, while the number of primary schools only increased from 226 to 340. The situation for senior high schools is even worse, as fewer than half of the city’s 16-year-olds can find a place in a public school.  

To enroll in school, applicants are rated mostly on whether they have a local household registration or whether they own property in the school district, which not only drives up housing prices, but also serves as a major deterrent for many would-be parents to have children.  

Shenzhen city government recently pledged that it would add 740,000 school places to meet the demand. But as one of China’s most prosperous cities, Shenzhen’s education situation reflects the challenges faced by parents across the country.  

Talent Dividend 
For many, after decades of birth restrictions that have led to a change in cultural norms, the decline in the fertility rate has become too sharp and the government’s actions are too late and far from enough to reverse the trend.  

Experience from many other countries shows that even the best practices in offering incentives to encourage people to have more children only have mild effects on countering the trend.  

In China, a more troubling sign is that the younger generations not only tend to have fewer children, but also appear to have less interest in marriage. In 2019, only 9.5 million marriages were registered with the Ministry of Civil Affairs, 4 million, or 30 percent, down from the figure in 2013.  

But not all experts are so pessimistic about the prospect of China being an aging society. Ren Yuan, a demographer from Fudan University, argued that population composition is an important factor, but not a decisive one for a country’s development.  

Warning against what he calls “population determinism,” Ren said that the impact of any demographic shift must be perceived through its interaction with social, economic and policy dynamics. Just as a young population is not always associated with the so-called demographic dividend – when there is a high population of working-age people – an aging population does not mean doomsday either.  

“Before China embarked on a path of rapid economic development after the launch of its reform and opening-up policy in the late 1970s, the large proportion of young people in China was considered not as a dividend, but as the source of poverty and instability,” Ren said.  

Ren said that an aging population is in part a result of China’s economic development and social progress. Instead of focusing on the demographic shift alone, the government’s policy focus should be on balancing population and development.  

Ren’s argument may be the underlining rationale behind the apparently cautious and incremental approach of the government. At a press conference held on May 11, Ning Jizhe, head of the National Bureau of Statistics (NBS) said the country should address the aging population with a “balanced perspective.”  

Acknowledging there will be reduced supply in the labor force and increasing pressure on the supply of basic public services, Ning said that China remains a very populous country with a “tight” balance between its population and available resources, and creating enough jobs for the population is still a major challenge.  

Ning highlighted that one positive demographic shift is that China’s labor force is now better educated than before. The census data shows that on average China’s working population has an education of 10.75 years on average, 1.08 years more than 10 years ago. In 2020, 15.5 percent of China’s total population, or 218 million people, had received higher education. 
“Talent dividends will gradually emerge following the improved education level,” Ning said.