China

Animated Chart: China’s Aging Population (1950-2100)

Published

2 years ago

December 27, 2021

James Eagle

Featured Creator

Article/Editing:

Govind Bhutada

China’s Aging Population Problem

The one-child policy defined China’s demographic transition for over three decades.

But to combat an aging population and declining birthrates, the government scrapped the policy for a new two-child policy in 2016. Despite this massive change, China still faces a growing demographic crisis.

The above animated population pyramid from James Eagle looks at the distribution of China’s population by age group since 1950, with projections up to the year 2100.

How the One-Child Policy Created a Gender Imbalance

Until 2016, the Chinese government strictly enforced the one-child policy since 1979 with hefty fines for any breach of rules. According to the government, the policy reduced 400 million births over the years.

However, it also led to sex-selective abortions due to a deep-rooted cultural preference for boys. As a result, China’s gender balance tilted, with a sex ratio of 111 males to 100 females in the population aging from 0 to 4 years old in 2020.

Often termed “the missing women of China”, this shortage of women is expected to worsen over time. According to the U.N.’s World Population Prospects, China is projected to have around 244 million fewer women than men in 2050.

Additionally, the country faces another impending consequence of the one-child policy—a rapidly aging population.

Why China’s Population is Aging

In 2020, China’s fertility rate—the number of children a woman is expected to have over her lifetime—stood at 1.3.

Generally, fertility rates drop as economies develop. However, China’s fertility rate is now lower than that of the U.S. (1.64 in 2020) and on par with countries like Japan and Italy, both of which are facing aging populations. Consequently, fewer newborns are entering the population, while many in the workforce approach retirement.

Most Chinese workers retire by age 60. Here’s how China’s retirement-age population is expected to shape up by the year 2100:

Year	60+ Population	% of Total Population
1980	74,899,385	7.5%
2000	129,460,648	10.0%
2021	258,371,810	17.9%
2050	485,489,066	34.6%
2070	454,270,458	36.1%
2100	402,780,972	37.8%

In 2021, people aged 60 and over made up nearly one-fifth of the Chinese population. As the country’s population begins declining around 2030, over 30% of all Chinese people are expected to be in this age group.

China’s aging population threatens long-term economic growth as its workforce shrinks and low fertility rates result in fewer newborns that would later enter the working-age population. Fewer working people means lower overall consumption, a higher burden on elderly care, and slowing economic growth.

So, how will China respond to the oncoming crisis?

The Three-child Policy

According to the 2020 national census, Chinese mothers gave birth to 12 million children in 2020—the lowest number of births since 1949.

In response to these results, the government passed a new law allowing each couple to have up to three children. Despite the change, the high cost of raising a child may deter couples from having a third child.

It remains to be seen how the three-child policy helps combat China’s demographic crisis and which other policies the government chooses to deploy.

This article was published as a part of Visual Capitalist's Creator Program, which features data-driven visuals from some of our favorite Creators around the world.

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Markets

Charted: Six Red Flags Pointing to China’s Economy Slowing Down

We chart six red flag indicators threatening China’s economy and it’s post-pandemic recovery, as well as global economic growth

Published

3 weeks ago

September 5, 2023

Chris Dickert

Six Red Flags Pointing to China’s Economy Slowing Down

The People’s Republic of China is the world’s second-largest economy, responsible for one quarter of global GDP growth this millennium—so when the country catches a cold, the world notices.

The past several months have seen an avalanche of bad economic news for China, putting the country’s post-pandemic recovery, and global economic growth, in jeopardy.

In this visualization, we look at six important indicators that point to China’s economy slowing down. Data comes from the National Bureau of Statistics of China, the People’s Bank of China, and the General Administration of Customs, to see what is flashing red.

Six Red Flag Indicators on China’s Economy

1. GDP

China’s annual GDP growth rate has averaged 9% since 1978, when the country opened itself up to the global market under Deng Xiaoping.

However, growth seems to have slowed to a crawl, down to 0.8% (quarter-to-quarter) in the second quarter of 2023 driven by weakness in the Tertiary Sector, which includes retail spending and the troubled real estate sector. This follows a more robust 2.2% figure in Q1, which was driven by pent-up demand released by the end of COVID-era lockdowns.

On an annual basis, China’s GDP expanded 6.3% year-over-year, below the forecasted 7.3% rate.

2. Exports

Exports fell by 14.5% in July, marking the third straight month of declines, and hitting lows not seen since February 2020. Meanwhile, imports fell 12.4%, reflecting the cautious consumer mood.

On a regional basis, exports fell year-over-year to China’s three biggest customers, ASEAN, the EU, and the U.S., by 17.4%, 15.1%, and 20.8% respectively.

There was one bright spot, however: exports to sanction-burdened Russia increased 51.8%, but that wasn’t nearly enough to offset the overall downward trend.

3. Consumer Price Index

The consumer price index moved into deflationary territory for the first time since 2021, with prices falling 3% year-over-year. The decline was led by Household Articles and Services, Food & Tobacco, and Transportation and Communications.

At the same time, the prices that producers paid for industrial products (PPI) fell 4.4% (year-over-year), the tenth month in a row with a negative reading.

4. Youth Unemployment

And while the headline unemployment rate remained steady at 5.3% in August 2023, up slightly from 5.2% the month before, it papers over serious weakness for urban youth, aged 16 to 24.

In July, the urban youth unemployment rate reached 21.3%, the highest ever recorded in the country, leading the National Bureau of Statistics of China to suspend future releases.

5. Yuan vs. USD

Given the stream of economic bad news, it’s no surprise that the yuan fell to a 16-year low against the U.S. dollar on August 16, 2023 in offshore trading.

In an effort to stabilize the currency, major state-owned Chinese banks were seen buying up yuan in offshore money markets. At the same time, the spread between the fixed exchange rate set by the People’s Bank of China and the offshore rate, rose to more than 1,000 basis points.

6. New Loans

Adding to the dismal economic mood, people borrowed less money according to the most recent figures provided by the government.

New bank loans fell to ¥346 billion in July, down from ¥3.05 trillion in the month before. This was the lowest reading since late-2009, and less than half of the ¥780 billion economists had forecast.

What’s Next?

Foreign Affairs recently published an article with the provocative title “The End of China’s Economic Miracle,” arguing that China’s troubles could be a U.S. opportunity.

And while this may be somewhat premature, the Middle Kingdom has some serious structural issues to contend with, many of them of their own making. Some of the top challenges include crackdowns on the tech sector, a collapsing real estate market, a larger debt crisis, and a shrinking population.

But large-scale government intervention does not appear to be in the offing, beyond exhortations for consumers to spend more and blaming Western media for engaging in “cognitive warfare.”

It’s no wonder that consumer confidence has plunged so low. At least we think so: the Chinese government stopped publishing that too.