China’s aging population continues to intensify and the pressure on the elderly to provide for them increases

Recently, the Communist Party of China (CPC) officially released the main data of the 7th National Census, which shows that China’s population aging continues to intensify. The issue of aging society and support for the elderly has become a focus of attention.

According to the 2020 Chinese census data released on May 11, China’s elderly population aged 65 and above is 190 million, accounting for 13.5% of the total population; meanwhile, the working population aged 15 to 64 accounts for 68.6%, making the dependency ratio of Chinese people aged 65 and above, 19.7% (nearly 20%). In other words, for every 100 people in the labor force in China, they need to support nearly 20 people over the age of 65.

However, if we use the age of 60 to divide the working population and the retired elderly, China’s elderly population aged 60 and above is 260 million, accounting for 18.7% of the total population; at the same time, the working population aged 15 to 59 accounts for 63.4%, making the dependency ratio of the elderly aged 60 and above in China, 29.5% (nearly 30%), which means that for every 100 people in the labor force, China needs to support nearly 30 for every 100 people in the labor force.

As can be seen from the data with the retirement age set at 65 and 60, a 5-year reduction in the retirement age results in a net increase of 10 (half) of the number of elderly people to be supported per 100 people in the labor force, from 20.

According to international standards, 7% to 14% of the population aged 65 and above is considered a mildly aging society, 14% to 20% is considered moderately aging, and 21% to 40% is considered severely aging. According to this standard, China’s current 13.5% still belongs to a lightly aging society and is approaching a moderately aging society.

The old age dependency ratio, which is the ratio of the elderly population to the working population, indicates the number of elderly people to be covered per 100 working people; sometimes it is also expressed as the result of the working population compared to the elderly population, and is the number of working people needed to cover one elderly person.

If the retirement age is 65, China’s dependency ratio is 5.1; if the retirement age is 60, the dependency ratio becomes 3.4, meaning that a 5-year reduction in the retirement age reduces the number of laborers needed to support one elderly person by one-third (1.7).

The Epoch Times reporter checked the data on the elderly dependency ratio from 1982-2019 in the China Statistical Yearbook of the National Bureau of Statistics of the Communist Party of China, and found that they all used the United Nations’ standard of using 65 as the retirement age line to distinguish between the working population and the retired elderly. This figure, however, is 11 years later than China’s actual retirement age of 54. It is not hard to imagine that this 65-year-old statistic is far from the true extent of China’s aging population.

China’s aging problem is more serious than the statistics

Regarding China’s aging population, Zhao Yaohui, deputy director of the National Development Research Institute at Peking University and head of the China Health and Aging Tracking Survey (CHARLS) task force, cites data from the UN World Population Prospects 2019 report, which uses age 60 as the dividing line between the working population and the retired elderly to calculate China’s elderly population dependency ratio.

He said that China’s dependency ratio has been declining since 1950, reaching 3.4 in 2020, and is expected to reach 1.3 in 2050, which means that for every 3.4 people in the labor force now, China needs to cover one elderly person over the age of 60; in 30 years, China will have to cover one elderly person for every 1.3 people in the labor force.

Zhao Yaohui further specifies this dependency ratio to pension insurance contributions, and the results are even more alarming; as early as 2019, China is already burdened with 1 old person’s pension for every 2.5 contributing urban workers; China is now running a pension insurance account deficit.

According to him, the deficit of China’s pension insurance fund in 2017 alone has reached RMB490 billion (US$76.9 billion), accounting for 12% of the total pension expenditure of RMB4.08 trillion (US$640.7 billion) that year, resulting in more than RMB800 billion (US$125.6 billion) in financial subsidies at all levels. Zhao Yaohui speculated that as “the age structure of the population continues to deteriorate, the deficit (of China’s pension fund) will continue to grow.

China’s aging population and dependency ratio are both growing exponentially

In the China Statistical Yearbook’s 1982-2019 data on the population age share and dependency ratio of people over 65, the Epoch Times reporter selected the census years 1982, 1990, 2000, 2010 and 2020 for reference, and also selected data from 1987, 2005 and 2015, which have larger sampling values than the average years.

The year 1982 is the year when the Communist Party of China officially started to strictly implement the “one child per couple” “family planning policy”.

For the period 1982 to 2020.

The share of the population aged 0-14 years in the total population dropped sharply, reaching a low point in 2010 and 2015, and then increased slightly. In 2015, China began to relax its family planning policy and allowed the birth of two children; the proportion of the working population aged 15-64 gradually increased, peaking in 2010 and then decreasing; the proportion of the population aged 65 and above slowly increased, increasing after 2010 and showing an overall exponential The dependency ratio between the working population aged 15-64 and the population aged 65+ shows an even more pronounced exponential growth trend.

According to the United Nations “World Population Prospects: The 2019 Revision,” the global dependency ratio of people over 65 years old is 9% in 2019, and the figure for China is 17.8%; by 2050, it is expected that the global dependency ratio of people over 65 years old will reach 16%, and China will reach 26.1%, entering a heavily aging society. society, by which time China’s population of people over 65 will reach 365.4 million.

China’s new population will be significantly lower

Yuan Xin, a professor at the Institute of Population and Development at Nankai University and vice president of the Chinese Population Society, said that “the intrinsic growth rate of China’s population has turned from positive to negative” since 1992, 10 years after the Communist Party’s “family planning policy” was implemented. “If the fertility rate of about 1.3 in 2020 is maintained, the population will grow negatively around 2025.”

Lei Xiaoyan also attributed China’s declining fertility rate and declining new population to the main factor of the declining working-age population, saying it will further accelerate the aging process of China’s population.

According to data from the China Statistical Yearbook, the Epoch Times reporter found that not only has the percentage of China’s population aged 0 to 14 been declining, but its actual population has been on the same downward trend. From 340 million people in 1982, when the Communist Party’s family planning policy began, the population has fallen all the way to 190 million people in 2020, a 44.1 percent drop.

Lei also predicts that China’s next population aging peak will likely occur between 2027 and 2038, when the population born during the “baby boom” of the 1960s and 1970s will enter an aging phase.

Unlike the strictly enforced “family planning policy” after the 1980s, when the Communist Party propagated the idea of having more children per family, in 2015, more than 30 years after the “family planning policy” was implemented. Similarly, in 2015, more than 30 years after the implementation of the “family planning policy,” the CCP has begun to encourage Chinese women of childbearing age to have more children in order to increase the fertility rate and new population at the bottom of the valley.

But Lei Xiaoyan, in suggesting that the authorities fully liberalize childbirth, said that young people in China now have very low fertility intentions and “don’t worry that liberalization will lead to many children.”

Extended reading: China’s actual retirement age is only 54

According to the Chinese Communist Party’s Ministry of Human Resources and Social Security, the actual retirement age in China was only about 53 in 2012 and 54 after a recent slight adjustment.

The legal retirement age in China is 60 for male workers, 55 for female cadres and 50 for female workers; with men retiring at only 55 and women at only 45 after a certain number of years in special jobs.

In 2018, the CPC made an upward adjustment to the retirement age, starting in 2021, the statutory retirement age for women will be delayed by one year every three years on top of 55, and the retirement age for men will be delayed by one year every six years on top of 60 until both men and women reach the retirement age of 65 in 2045.

According to the World Bank’s 2019 information on the legal retirement age for countries around the world, Chinese women have the earliest retirement age in the world. In the 1980s and 1990s, Chinese Communist authorities also encouraged parents to retire early so that their adult children waiting for employment could take their place in factories.

In China, the ability to retire late is a special privilege available only to senior Communist Party officials, and the higher the rank, the later the retirement. The highest CCP officials at the state level, such as several members of the Standing Committee of the Political Bureau of the CCP Central Committee, can retire at age 68, and the retirement age does not appear to be clearly defined as 75 or even older; the retirement age for vice-state and provincial cadres is 65, and can reach 68 by tenure; at the vice-provincial level, the retirement age drops to 60, and can reach 63 at the latest by tenure.