China's population has witnessed a decline for the second consecutive year, raising concerns about the future growth of the world's second-largest economy.
Data released on Wednesday revealed that the population stood at 1.409 billion at the end of 2023, reflecting a 2.08 million decrease from the previous year. This decline is twice the rate observed in the preceding year, marking the first population drop in 60 years.
Experts attribute the recent population decline to China's expanding urban class and a record-low birth rate. Beijing disclosed that the birth rate has now reached 6.39 per 1,000 people, aligning with rates in other advanced East Asian nations such as Japan and South Korea. China has grappled with falling birth rates since the 1980s when a controversial one-child policy was implemented to curb over-population. The policy was lifted in 2015, with subsequent incentives like subsidies and payments introduced to encourage family expansion. In 2021, the government further relaxed restrictions, allowing couples to have up to three children.
Despite these measures, the policies have had limited impact, as young urbanites cite deterrents like the rising cost of living and career priorities, exacerbated by the economic challenges of a post-Covid era. A 31-year-old woman in Beijing, Wang Chengyi, expressed her desire to have a child but stated, "My husband and I do want to have a kid, but we can't afford it for now." She highlighted the financial burden and the need to save for several years to provide for the costs associated with raising a child, including school expenses.
Experts point to the pandemic's impact in accelerating the decline in new births, but they emphasize that underlying economic issues play a more significant role. China is now following the trajectory of other countries that have rapidly deindustrialized, with population decline becoming an inevitable consequence. Prof Stuart Gietel-Basten, a population policy expert at the Hong Kong University of Science and Technology, stated, "It's not a surprise. They've got one of the lowest fertility rates in the world so this is just what happens - the population stops growing and starts to decline."
China's economic challenges in 2023, marked by a widespread property crisis, falling consumer spending, and record youth joblessness post-pandemic, are reflected in annual data indicating one of the slowest economic growth rates in over three decades. The GDP expanded at 5.2% to reach 126 trillion yuan ($17.5tn; £13.8tn) in 2023, the weakest performance since 1990 excluding the pandemic years.
Youth unemployment in China also rose, reaching 14.1% in December after hitting 21.3% in June. This information, coupled with the latest population data, raises concerns about the economy. China, having long relied on an aging workforce as a key driver of its economy, faces increasing pressure on its healthcare and pension systems as the retiree population is projected to grow by 60% to 400 million by 2035.
Despite these challenges, experts believe China has the time and resources to manage the workforce transition. Prof Gietel-Basten noted, "China is no different to other countries that have deindustrialized and moved into the service sector. The population becomes more educated and skilled and healthier, and they want to do other jobs rather than work in factories or construction."
Once the world's most populous nation, China was surpassed by India last year, with India's population now standing at 1.425 billion. As China grapples with economic challenges and demographic shifts, the implications for its future growth and global standing remain subjects of ongoing scrutiny and analysis.
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