China’s ageing society problem will accelerate over the next decade, with the number of citizens aged over 60 expanding by an average of 10 million per year, according to a leading demographer, adding further strain to the state pension fund, elderly care facilities and medical services.
The acceleration will push the number of senior citizens to 520 million by 2050, or 37.8 per cent of the population, according to Renmin University of China vice-president Du Peng.
China had 209.78 million people aged over 65 last year, accounting for 14.9 per cent of the population, up from 200 million in 2021, according to official data.
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“The coming decade from now on is the most crucial juncture for China to actively respond to the aging population,” Du said in an interview with Tencent Finance last week.
Beijing acknowledged various demographic challenges, including a low birth rate and fast ageing society, in May and vowed “high-quality development” of its population, although concrete measures have yet to be introduced.
It is already struggling to pick up its sluggish economic momentum, with a vanishing demographic dividend – when the labour force is large and both ends of the demographic curve are much smaller – and increasing pension pressures further complicating recovery efforts.
Pensions overtook family support for the first time as the main source of financial income for China’s elderly population in 2020, which Du considers as an “active signal”.
China confirmed in early 2022 that it will gradually start pushing back its long-mandated retirement ages – 60 for men, 55 for female office workers and 50 for female blue-collar workers – in the coming years, although Beijing has yet to release a timetable.
The urban worker pension fund, the backbone of the country’s state pension system, had earlier been predicted to run out of money by 2035 due to a decline in the available work force as the gap between contributions and outlays increases.
China will have an elderly population equal to that of all developed countries combined by 2030, Du added.
The National Health Commission estimated that China will have 402 million people aged over 60 by 2040.
The World Health Organization in October said that by 2030, one in six people in the world will be aged over 60, with the 2.1 billion people worldwide set to be aged over 60 by 2050.
Last year, 29.1 per cent of Japan’s population were aged over 65, with 17 per cent in the United States and South Korea and 7 per cent in India, according to World Bank data.
China, therefore, needs to expedite the integration of private pension insurance, enhance medical coverage and refine elderly care frameworks, Du said.
Timeline of decline. How has China’s demographic crisis emerged?
There were only 5.04 million elderly care beds at the end of 2021, according to the Ministry of Civil Affairs, while 40 million senior citizens shared 53.1 billion yuan (US$7.3 billion) in a variety of government subsidies.
China should also implement a flexible retirement system, starting with professions that are in high demand, such as teachers and doctors.
The elderly can also help address China’s shrinking young population by creating communities that blend seniors with young children, offering a helping hand to the overwhelmed younger generation to raise their children, Du added.
Last year, China’s population declined for the first time in six decades, with the national birth rate for 2022 falling to a record low.
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