ANALYSIS: China’s Aging Population Poses Unprecedented Challenges for the CCP

An elderly man and woman are pushed in wheelchairs along a street in Beijing on May 11, 2021. Wang Zhao/AFP via Getty Images

News Analysis

China’s aging population has become a major demographic challenge as the average age of the urban and rural labor force is approaching 40 years old. And experts say the Chinese Communist Party (CCP) has no solution to tackle the issue.

China’s Ministry of Civil Affairs released a report in 2022 saying that 19.8 percent of the Chinese population were over 60 and 14.9 percent were over 65. The dependency ratio of the elderly population aged 65 and above was 21.8 percent, representing an increase of 1 percent from 2021 and an increase of 9.1 percentage points from 2012, showing a continuous upward trend.

These figures represent the retirement-age to working-age demographic ratio, calculated as the number of individuals aged 65 and over per 100 working-age people (15 to 64). According to 2022 data, on average, less than five working-age people in China will have to support one elderly person aged 65 and above.

It is important to note that the elderly population in the government data does not reflect the actual numbers. In China, the current retirement age is 60 for men, 55 for women in state-owned enterprises and those employed by the state, and 50 for female blue-collar workers. So China’s elderly population essentially includes individuals aged 60 and above, and the CCP’s report likely underestimated the number of retired individuals in the country.

Effect on Labor Force

As China’s aging population increases, the average age of the labor force is also rising.

China’s Central University of Finance and Economics recently released its “Human Capital in China 2023“ report, which said that by the end of 2021, the average age of China’s labor force was approaching 40 years old, with male laborers in rural areas already over 40.

The report also said that from 2011 to 2017, the growth rate of China’s total human capital dropped from 10.9 percent to 6.7 percent. This was mainly due to the impact of an aging population, which has led to a decrease in the accumulation of work experience and skills.

Notably, in the capital city of Beijing, the average ratio of working individuals to retirees is 2 to 1.

These figures indicate that China’s labor market is experiencing unprecedented challenges. Over time, this trend could negatively affect the country’s economic development.

Fastest Aging Country

China has the world’s largest population of older adults.

According to Chinese economist Ren Zeping, in 2001, more than 7 percent of China’s population was over the age of 65, marking the beginning of an aging society, and it took 21 years to enter into a “deep aging” society, with more than 14 percent of the population aged 65 and over.

Mr. Ren predicts that by 2050, half of the population will fall into the elderly category due to the rapid aging of individuals born during China’s baby boom from 1962 to 1975.

In September, Chinese scholar Du Peng said that, owing to the effects of the birth peak in 1963, the current year would witness the highest net increase in the elderly population. From this year onward, China’s aging population is projected to rise steadily, reaching approximately 500 million people by 2050, before declining after 2052.

Li Yuanhua, a former professor at China’s Capital Normal University, told The Epoch Times on Dec. 20: “The primary cause of China’s significantly aging population is the Chinese Communist Party’s one-child policy, which disrupted the natural growth of the population. It took four decades from the 1970s for China to have an aging population, so it will take decades more to recover.”

The one-child policy, implemented by the CCP between 1979 and 2015, has led to a typical scenario where a married couple has two parents on each side to care for.

Low Birthrate

The birthrate in China has been falling for the past six consecutive years. In 2022, the fertility rate hit a historic low of 1.09, with major cities like Beijing and Shanghai recording rates as low as 0.7–0.9.

The number of marriages in China has declined for nine consecutive years and hit a record low of 6.83 million in 2022, the lowest since public records became available in 1986.

To address the aging problem, the CCP shifted to a “two-child policy” in 2015, which changed to three in 2021. However, this has not been effective in preventing a declining birthrate.

Many Chinese people have expressed that they are not willing to raise children due to high costs.

No Solution in Sight

Shanghai-based economist Li Xunlei commented in Chinese media that, unlike developed countries that are “getting rich before they get old,” China is “getting old before it gets rich.” As waves of people retire, the issue of pension shortfalls will soon emerge, he said. Furthermore, aging will lead to a decrease in the working-age population, and the cost of labor will continue to increase, causing China to lose its advantage in attracting foreign investment.

Mr. Li Yuanhua believes that the CCP’s economic model used to rely on cheap labor to become the “world’s factory.” However, with a decline in the proportion of young and middle-aged individuals in the population and a rise in labor costs, the previous economic model is no longer sustainable, he said. Moreover, the reduced workforce contributing to wealth creation coupled with an increasing elderly population will result in higher expenditures on medical care, social welfare, and more. This will likely impact China’s overall economy and could lead to an economic collapse.

“The biggest crisis that could break out in Chinese society is if the CCP misappropriates the country’s state pensions,” said Mr. Li Yuanhua. “This is a huge potential crisis in the future and a destabilizing factor for the regime.”

Xin Ning contributed to this report.