China’s population sees 2nd consecutive year of decline amid economic and demographic challenges

The COVID-19 pandemic had a significant impact on the country, leading to a 6.6% increase in total deaths to 11.1 million, with the death rate reaching its highest level since 1974. New births fell by 5.7% to 9.02 million, accompanied by a record-low birth rate of 6.39 births per 1,000 people, down from 6.77 in 2022.

China’s population has experienced a second consecutive year of decline in 2023, with the National Bureau of Statistics reporting a drop of 2.08 million people, or 0.15%, bringing the total to 1.409 billion. This follows a decline of 850,000 in 2022, marking the first population decrease since 1961. Contributing factors include a record-low birth rate and a surge in COVID-19 deaths after strict lockdowns were lifted in December 2022.

The COVID-19 pandemic had a significant impact on the country, leading to a 6.6% increase in total deaths to 11.1 million, with the death rate reaching its highest level since 1974. New births fell by 5.7% to 9.02 million, accompanied by a record-low birth rate of 6.39 births per 1,000 people, down from 6.77 in 2022. China has been grappling with declining birth rates for decades, influenced by the one-child policy in effect from 1980 to 2015 and rapid urbanization, which increased the cost of raising children.

In addition to demographic challenges, economic factors further dampened the desire for childbirth in 2023. Youth unemployment hit record highs, worker wages fell, and a crisis in the property sector intensified, affecting more than two-thirds of household wealth stored in real estate. The declining birth rate adds to concerns about China’s economic growth prospects, with fewer workers and consumers, and increasing costs for elderly care and retirement benefits straining local governments.

Furthermore, the United Nations predicts that China’s population could shrink by 109 million by 2050, three times more than their 2019 forecast. The population aged 60 and overreached 296.97 million in 2023, constituting 21.1% of the total population, up from 280.04 million in 2022.

China’s retirement-age population is expected to exceed 400 million by 2035, presenting challenges to the pension system. The Chinese Academy of Sciences anticipates the pension system running out of money by 2035. This demographic shift poses long-term economic and social challenges, as the older population grows, while the working-age population declines.

Efforts to encourage childbirth, such as tax deductions, longer maternity leave, and housing subsidies, have been implemented by local governments. However, their effectiveness has been limited due to insufficient funding and lack of motivation. President Xi Jinping has emphasized the importance of cultivating a new culture of marriage and childbearing for national development. Despite incentives, many couples remain hesitant to have more children due to high childcare and education costs, job market uncertainties, and traditional gender expectations.