Aging of China

China uses the one-child policy to stabilize fertility levels

In order to suppress excessive population growth, the one-child policy was introduced in 1979.[11] The enforcement methods include financial penalties, widespread use of various contraceptive methods, as well as more severe forced abortion and sterilization.[3][11] As a result, birth rates and population growth rates have drastically decreased.

With economic growth and social development, increasing smoking, alcohol use, unhealthy diets, and psychological stress have an effect on lowering the fertility rates of couples. Surging pollution in China also has an impact on male sperm count, which has been declining since the 1970s. At the Chinese University of Hong Kong, a team of scientists studied the sperms from approximately 6,500 men and found a "strong correlation" between high levels of air pollution and "abnormal sperm shape".[12] Researchers point out that many particulate matter components are associated with sperm damage in experimental studies.[12] Exposure to air pollutants may cause free radicals damage which adversely alters DNAs and cellular processes in the human body. These conditions may be associated with a significant number of infertile couples, lowering the fertility rate.

China's sex ratio is the most skewed in the world.[13] The country's ratio of males to females is skewed 3% to 4% higher towards males.[11] In the traditional, patriarchal society, many Chinese people believed that men were more important than women.[11] This mindset has continued to be prevalent in modern China, especially in rural areas, resulting in high female fetal abortion rates and even female infanticide.[11] The imbalance in sex ratio has led to a decrease in marriage rates and birth rates in China.

The improvements in social welfare and the medical system have prolonged people's life span. Since 1949, the health of the Chinese people has greatly improved, and the life expectancy has increased by about 30 years, from 44.6 to 75.3 years from 1950 to 2015. It is expected to reach approximately 80 years in 2050.[9] The minimum income security in rural areas has been expanded and is covering more than 50 million residents in poor areas.[14] The Chinese government has unified the welfare systems of urban and rural migrants, and the pension system covers nearly 700 million people.[14][15]

Despite the improvement of China's social welfare system, there are still huge inequalities in health between urban and rural areas.[15] Compared with urban peers, the number of medical service providers for rural residents is significantly reduced, and the utilization rate of facilities is low, resulting in their poor health.[15] Since the late 1990s, three new medical insurance systems have been established by the government to provide more health care services.[16] In 2009, urban and rural health insurance reforms achieved greater coverage.[16] More advanced medical techniques have reduced the prevalence of diseases and increased survival.[17]

Rapid aging could create challenging social problems and increase the risk of social instability in China.[1]

Due to the lower fertility rate and extension of the human life span, the population in China is aging faster than almost all other countries.[1][2] In 2050, the proportion of Chinese over retirement age will become 39 percent of the total population.[18] At that time, its dependency ratio will rise to 69.7%, almost twice as high as that in 2015, which was about 36.6%.[18] The higher dependency ratio is associated with the greater pressure placed on those who are working to support the rest of the population. Even if the Chinese government provides part of the financial support for the elderly through social welfare, such as pensions and public welfare homes, there are still many elderly people in China who are unable to be taken care of.[18] In 2015, there were, on average, 27 beds per 1,000 elderly homes in China, far fewer than those in the United States or Germany.[18]

The aging population in China has increased the incidence and types of chronic diseases. Chronic diseases include four basic types: cardiovascular diseases, cancer, respiratory diseases, and diabetes.[19] There are nearly 300 million chronic patients in China, half of whom are over 65 years old.[19] During aging, many cellular and molecular events break down and eventually lead to a variety of chronic diseases, such as coronary heart diseases (CHD). The number of CHD incidents and deaths in China will increase dramatically from 2010 to 2029; among Chinese adults aged 35–84, a 64% increase in CHD occurrences is predicted between 2020 and 2029.[5]

A large number of the elderly population has increased the pressure on the government to allocate the pensions and make social welfare more accessible.[6] The lack of conventional financial infrastructure and the extent of the aging population make it difficult for China to provide a holistic solution.[6] At an economic growth rate of 8 percent, pension spending is growing at a rate of 15 percent per year.[6] Pension expenditure increased by 11.6% in 2016, reaching 2.58 trillion yuan, with a shortfall of 429.1 billion yuan requiring government subsidies.[20]

Since the establishment of the pension system, China has been paying the salaries of retirees with the contribution of the working population.[20] As more people retire and fewer people enter the labor market, the gap between income and expenditure will continue to widen.[20] China's Working Committee on Ageing suggested that the inclusion of improved care services for the elderly in the national development road-map would be a key measure for the top leadership to cope with population aging.[21] The elderly care service market provides more opportunities for private capital and non-governmental organizations so that the elderly can have more service choices.[21]

Since economic expansion is the sum of input factor growth and productivity growth, it will require a substantial increase in labor productivity to sustain the same top-line growth as the population ages.[22] China's aging population has led to a contraction of the labor force that induces a slowing economic growth.[7] In 2017, China's total working-age population (aged between 15 and 64) was 988.3 million, which dropped by a large margin of 0.07 billion from the end of 2016.[23]

China is urged to raise the legal age of retirement to cope with the problem of a reduced labour force.[7] In 2016, the Chinese government announced plans to gradually raise the retirement age from 50 years old to over 60 years old.[24] It may expand productivity and improve the sustainability of national pension accounts by improving the level of education and skills of Chinese workers to make up for the gap from the decreasing proportion of the working-age population.[24][7] In order to improve the quality of the labor force, the number of university enrollment has increased by seven times since 1999 in China.[25]

Aging in China has affected women's labor force participation to a certain extent. A large proportion of grandparents in China provide the free services of raising grandchildren for their children. This constitutes a main reason why women decide to stay in the labor market.[24] China has a relatively high female labor force participation rate of 61.5%.[24]

An increase in the number of retirees and a decrease in the number of taxpayers will affect the government's allocation of funds.[18] The expansion of the elderly ratio forces the government to support them by providing pensions and expanding social welfare, which will affect the government budget. China's pension funds accounted for nearly 70% of China's social security income in 2017.[26] Without subsidies from the central government, many local pension funds will run into a deficit, of which the total is expected to rise from 234 billion yuan to 534 billion yuan in 2022.[26]

In 2015, the two-child policy was introduced to replace the one-child policy.[8] China has been taking gradual measures to eliminate the one-child policy. In 2009, if both parents were only children, they were allowed to have two children. In 2014, most provinces in China further relaxed their policies, allowing families to have two children if one of the parents was an only child.[25] However, since the implementation of the two-child policy, there has been no significant improvement in China's population aging.[27] It is expected that the effect of the policy will not be significant until two decades later.[28] After the relaxation of the one-child policy, 17.9 million babies were born in 2016, an increase of 1.3 million over the previous year, but only half of what was expected.[27] In 2017, the birth rate fell to 17.2 million, far below the official forecast of more than 20 million.[27] It is possible that the Chinese government will further relax its fertility policy in the future.[27]