Aging of China

China uses the one-child policy to stabilize low fertility levels

In order to suppress the excessive population growth rate, the one-child policy was published in 1979.[11] The law enforcement methods include financial penalties and widespread use of various contraceptive methods, or even more severe forced abortion and sterilization.[3][11] Therefore, the birth rate and population growth rate decreased.

With economic growth and social development, the increasing incidence of smoking, drinking, unhealthy diet, and population pressure has an effect on the lower fertility rates of couples.[11] In addition, pollution has an impact on the surge in the number of male sperm in China, which has been declining since the 1970s.[11] In the Chinese University of Hong Kong, a team of scientists studied sperm from approximately 6500 men and found a "strong correlation" between high levels of air pollution and "abnormal sperm shape".[12] Researchers point out that many particulate matter components are associated with sperm damage in experimental studies.[12] Exposure to air pollutants may cause free radical damage because it damages DNA and alters cellular processes in the body.[12] These conditions may cause a significant number of infertile couples and decrease the fertility rate.

China's sex ratio is the most biased in the world.[13] The overall sex ratio is higher in males and 3% to 4% higher than in females.[11] In traditional concepts, there has been an ancient Chinese belief that men are more important than women.[11] This phenomenon occurs in rural areas especially.[11] Because the son inherited his family name and property and took care of his elderly parents, the girl became very unpopular, resulting in an increase in the female fetal abortion rate, and being placed in orphanages or abandoned, and even infanticide.[11] As a result, many families adopted thousands of Chinese girls in the United States and other countries.[11] The imbalance between male and female ratio leads to a decrease in the marriage rate and birth rate.

The improvement of social welfare and the medical system has prolonged people's life span. Since 1949, the health of the Chinese people has greatly improved, and the life expectancy of them has risen about 30 years. It increased from 44.6 to 75.3 years from 1950 to 2015 and is expected to obtain approximately 80 years in 2050.[9] The minimum income security in rural areas has been expanded and benefited more than 50 million residents in poor areas.[14] Ten years ago, only the majority of urban residents received pensions of about 200 million people. Now, the government unifies the welfare system of urban and rural migrants, and the pension covers nearly 700 million people.[14][15] Despite the improvement of China's social welfare system, there are still huge inequalities in health between urban and rural areas.[15] Compared with urban peers, the number of medical service providers of rural residents is significantly reduced, and the utilization rate of facilities is low, resulting in their poor health.[15] Therefore, since the late 1990s, three new medical insurance systems have been established by the government to provide more medical resources.[16] In 2009, the government aims to offer universal coverage for all residents and to improve their health care services for the vulnerable.[16] In 2009, urban and rural health insurance reform achieved greater coverage of health insurance.[16] In addition, advanced medical techniques have reduced the prevalence of diseases to increase survival.[17] Ensuring universal social welfare and timely and effective medical services have greatly increased people's life expectancy.

Due to the lower fertility rate and extension of the human life span, the population in China is aging faster than almost any other country.[1] In 2050, the proportion of Chinese over retirement age will obtain 39 percent of the total population.[18] At that time, its dependency ratio will rise to 69.7% that will be higher than that in 2015 about 36.6%.[18] The aged dependency ratio has calculated the population under 15 and over 65 divided by the total working population to compares the difference between the non-working population and the working or full-time population. The higher the dependency ratio, the greater the pressure on the working population to bear the economic capacity to support. Actually, even if the Chinese government provides part of the financial support for the elderly through social welfare, such as pensions and public welfare homes, there are still many elderly people in China who can not be raised.[18] In 2015, there were 27 beds per 1,000 elderly homes in China on average, fewer than in the United States and Germany.[18] It is obvious that more resources are needed for China to meet the needs of the elderly.

In addition, the aging population in China increases the incidence and types of chronic diseases. Chronic diseases extend to four basic types, including cardiovascular diseases, cancer, respiratory diseases, and diabetes, which damages some vital organs, such as the brain, heart, and kidney.[19] There are nearly 300 million chronic patients in China, half of whom are over 65 years old.[19] During aging, many cellular and molecular events break down and eventually lead to a variety of chronic diseases, such as coronary heart disease (CHD). Due to population growth and aging, the absolute number of CHD incidents and deaths in China will increase dramatically from 2010 to 2029.[5] It is predicted that the number of CHD incidents among Chinese adults aged 35–84 will increase by 64% between 2020 and 2029.[5]

Therefore, due to the aging of the population, the increasing dependency rate and the increasing types and incidence of chronic diseases have brought certain social pressure.

A large number of the elderly population has increased the pressure of the government to allocate the pensions and popularize social welfare.[6] The lack of conventional financial infrastructures and the extent of the aging population make China difficult to provide a holistic solution.[6] At an economic growth rate of 8 percent, pension spending is growing at a rate of 15 percent per year.[6] Pension expenditure increased by 11.6% in 2016, reaching 2.58 trillion yuan, with a shortfall of 429.1 billion yuan requiring government subsidies.[20] Since the establishment of the pension system, China has been paying the salaries of retirees with the contribution of the working population.[20] As more and more people retire, fewer and fewer people enter the labor market, the gap between income and expenditure continues to widen.[20] China's Working Committee on Ageing suggested that incorporating improved care services for the elderly in the national development road-map was a key measure for the top leadership to cope with population aging.[21] The elderly care service market provides more opportunities for private capital and non-governmental organizations so that the elderly can have more service choices.[21]

According to the calculation, since economic expansion is the sum of labor force growth and labor productivity growth, achieving income growth of the same age as the population will require a substantial increase in productivity growth rate.[22] China's aging population has led to a contraction of the labor force that induces a slowing economic growth.[7]

In 2017, China's total working-age population (aged between 15 and 64) was 988.3 million, which dropped by a large margin of 0.07 billion from the end of 2016.[23]

Therefore, China should raise the legal age of retirement to cope with the problem of a reduced labour force.[7] In 2016, the Chinese government announced plans to gradually raise the retirement age from 50 years old to over 60 years old.[24] It could expand productivity and improves the sustainability of national pension accounts.[24] In addition, improving the educational level and skills of Chinese workers can make up for the possible gap that the decreasing proportion of the working-age population.[7] In order to improve the quality of the labor force, the number of university enrollment has increased by seven times since 1999 in China.[25]

On the other hand, a large proportion of grandparents in China provide free services for raising grandchildren for their children, which is the main reason why women decide to stay in the labor market.[24] Therefore, China has a relatively high female labor force participation rate of 61.5%, which is higher than that of the United States.[24] Therefore, aging in China has affected women's labor force ratio to a certain extent.

An increase in the number of retirees and a decrease in the number of taxpayers will affect the government's allocation of funds.[18] The expansion of the elderly ratio obliges the government to support them by providing funding and popularize social welfare, which will affect the other expenditure of the government. China's pension funds accounted for nearly 70% of China's social security income in 2017.[26] Without subsidies from the central government, China's pension fund will run into a deficit, which is expected to rise from 234 billion yuan to 534 billion yuan in 2022.[26]

In 2015, the two-child policy had been published to replace the one-child policy.[8] In fact, China has been taking step-by-step measures to liberate the one-child policy. In 2009, if both parents were only children, all provinces allowed couples to have two children. In 2014, most provinces further relaxed their policy that allows families to have two children if one of the parents is an only child.[25] However, since the implementation of the two-child policy, there has been no significant improvement in China's aging population.[27] It is not until two decades later that its role in the aging of the complementary labour force will be demonstrated.[28] After a relaxation of the one-child policy, 17.9 million babies were born in 2016, which is an increase of 1.3 million over last year, but only half of what was expected.[27] In 2017, the birth rate even fell to 17.2 million, far below the official forecast of more than 20 million.[27] Therefore, It is possible that the Chinese government will further relax its fertility policy in the future.[27]