The largest nation in the world is about to shrink.
However, after four extraordinary decades in which the Chinese population increased from 660 million to 1.4 billion, its population is in the process of falling this year, for the first time since the great famine from 1959-1961.
According to the latest figures from China National Bureau of StatisticsThe Chinese population increased from 1,41212 billion to only 1,41260 billion in 2021 – a low record increase of only 480,000, a simple fraction of annual growth of approximately eight million years ago.
While a reluctance to have children in the face of strict anti-COVID measures may have contributed to the slow birth rate, it has been happening for years.
China’s total fertility rate (births per woman) was 2.6 in the late 1980s – well above the 2.1 needed to replace deaths. It was between 1.6 and 1.7 since 1994 and has slipped to 1.3 in 2020 and just 1.15 in 2021.
Theories diverge on why Chinese women remain reluctant to have children in the face of state incentives. One consists in getting used to small families, another in the increase in the cost of living, another to the increase in the age of marriage, which delays births and slows down the desire to have children .
Moreover, China has fewer women of childbearing age than one might expect. Limited to have only one child since 1980, many couples have opted for a boy, passing the sex ratio to the birth of 106 boys per 100 girls (the ratio in most of the rest of the world) to 120and in some provinces to 130.
Decrease, on reasonable assumptions
China’s total population saw post-famine growth of just 0.34 per 1,000 last year.
Projections prepared by a team from Shanghai Academy of Social Sciences dropping it this year – for the first time after the famine – by 0.49 per thousand.
As late as 2019, the Chinese Academy of Social Sciences expected the population 2029to 1.44 billion.
The 2019 United Nations Population Prospects report predicted the peak even later, in 2031-32to 1.46 billion.
The Shanghai Social Academy of Social Sciences team provides for an average annual decrease of 1.1 % after 2021, dropping the Chinese population at 587 million in 2100, less than half of what it is today .
The reasonable assumptions behind this prediction are that China’s total fertility rate will slide from 1.15 to 1.1 by 2030, and stay there until 2100.
The rapid decline will have a deep impact on the Chinese economy.
China’s opening-age population peaked in 2014 and is expected to shrink to less than a third of that peak by 2100.
China’s elderly population (65+) is expected to continue growing for most of this period, overtaking China’s working-age population around 2080.
Older and much younger
This means that if there are currently 100 people of working age available to meet the needs of 20 elderly people, by 2100, 100 Chinese working age will have to provide the needs of 120 elderly Chinese.
The average annual decrease of 1.73 % of the Chinese population of working age opens the way to much lower economic growth, unless productivity increases rapidly.
The higher labor costs, driven by the rapid decrease in labor, should push manufacturing to low margin and high intensity of labor outside China to countries rich in hand in hand in hand -d’œuvre tels que le Vietnam, le Bangladesh et l’Inde.
Already, manufacturing labor costs in China are twice as high as in Vietnam.
More care, less manufacturing
At the same time, China will have to devote a larger part of its productive resources to the provision of health, medical and care services to the elderly to meet the demands of an increasingly old population.
Modeling by the Center for Policy Studies At the University of Victoria suggests that without modifications to the Chinese pension system, its retirement payments will be multiplied by five, going from 4 % of GDP in 2020 to 20 % of GDP in 2100.
For resource-exporting countries like Australia, these changes will likely require a shift in exports to manufacturers outside of China.
For importers of goods, including the United States, the source of goods is expected to gradually shift to new emerging manufacturing hubs.
Despite predictions that it will be “the chinese century“, These demographic projections suggest that influence could move elsewhere – including neighboring India, whose population should exceed China during the next decade.