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China’s shrinking populace: What does it mean?

BACKGROUNDER | The Asian nation’s population decline has far-reaching ramifications, at home and abroad


Xaume Olleros/Bloomberg via Getty Images

China’s shrinking populace: What does it mean?
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For the first time since 1961, China’s population is shrinking instead of growing. The country recorded some 1,411,750,000 people at the end of 2022, a decrease of about 850,000 from the year before, according to China’s National Bureau of Statistics. The trend has far-­reaching ramifications for China and the world.

Why is the population decreasing? Last year’s birthrate of 6.77 births per 1,000 people was a record low. Kang Yi, head of the statistics bureau, says citizens are less willing to have babies, they’re delaying marriage and pregnancy, and there are fewer women of childbearing age. But many point to the one-child policy that China enforced between 1980 and 2015. Combined with a traditional preference for boys among Chinese families, the policy has skewed the gender ratio, especially in rural areas, leading to fewer families forming. Last year’s death rate, at 7.37 deaths per 1,000 people, was the highest since 1974.

What does this mean for Chinese economics? While Kang says there’s no need to worry as the overall labor supply still exceeds demand, China’s economy grew by just 3 percent in 2022, one of its weakest performances in decades. That’s due largely to China’s “zero-COVID” lockdown policy and a real estate market slump. But a shrinking workforce and an aging population—nearly 20 percent of China’s residents are age 60 or older—may threaten future economic growth.

What about China’s social security system? Most Chinese men retire at 60, while women retire by 55 or earlier. The demand for pensions and healthcare will increase, but there will be fewer workers to fund these services.

What does it mean for the world? In the long run, with fewer young workers available to provide labor for Chinese factories producing inexpensive goods, manufacturing costs in China will increase. That may bump up prices and exacerbate inflation for countries that rely heavily on imports from China, such as the United States.

What is China doing about the population downturn? Communist officials allowed couples to have up to two children in 2016, then up to three since 2021. As of Feb. 15, Sichuan province will no longer limit the number of children people can have, nor will it ban unmarried women from registering a birth. This latest attempt to boost births follows other local government incentives, such as longer maternity leave, tax deductions, cash handouts, and housing subsidies. But experts doubt these measures will be ­sufficient to reverse the trend.

Is China still the world’s most populous country? The United Nations expects India to overtake China as the most populous nation this year.

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