One-child China now wants a baby boom

John Kane-Berman writes on that country's efforts to reverse looming demographic decline

Telling people how many babies they can have is probably the ultimate in political, social, economic, and family planning. That is what China did, a dictatorial policy it is now trying to reverse.

Adopted in 1980, the one-child policy was sometimes enforced by heavy fines for couples who violated it, sometimes by dismissing them from their jobs, sometimes by forced sterilizations, and sometimes by forcing women to have abortions, especially of female children. Some parents, fearing punishment for non-compliance, resorted to infanticide. Baby girls were sometimes abandoned. Tens of thousands of bureaucrats were employed to enforce the policy.              

It has been apparent for some time that China, thanks to its one-child policy, which favoured male children, was running out of mothers and therefore of babies and potential workers. According to The Economist, China now has at least 30 million more men than women. That magazine also warned many years ago that China, unlike many Western countries, was likely to become old before it got rich.

Lower birth rates and rising life expectancy mean that the productive and tax-paying workforce shrinks in relation to the older population, with major consequences for the financing of social security.

According to The Wall Street Journal, China’s recent national census showed that the number of births dropped from almost 18 million in 2016 to 12 million last year. The working-age population (people between the ages of 15 and 59) dropped from 70% of the total in 2010 to 63% last year. The proportion of the total population accounted for by people over the age of 60 rose from 13% in 2010 to almost 19% last year.

In other words, more and more non-working older people are dependent for their well-being on the taxes paid by fewer and fewer younger working people.

Facing demographic trends similar to those of China, many countries have increased their retirement ages in order to enable people to work longer before they become charges on pension and other social security funds. But lifting the retirement age is often politically unpopular. China has one of the world’s lowest retirement ages: 60 for most men and 50 for women. Last month the Politburo of the Communist Party said the retirement age would be gradually lifted.

The one-child policy, rising prosperity, urbanisation, and growing participation of women in the workforce have all helped to reduce China’s fertility rate to 1.3, which is very low for a developing country and lower even than that of a rich country such as Switzerland, whose rate is 1.54. China’s rate is also far below the 2.1 population replacement rate. Officials fear that the rate of economic growth will fall as the population shrinks. According to the Bloomberg news agency, China’s population of 1.44 billion could start shrinking as early as 2025.    

The declining birth rate has in fact already led to relaxations of the one-child policy. Since 2015 the government has allowed all couples to have two children. Last month, following the publication of census figures that appear to have alarmed the country’s government, the Politburo said married couples would now be allowed to have three children (although it did not say when the relaxations would take effect). Some officials even want birth limits to be entirely abolished.

The 2015 relaxation did not stop the decline in the birth rate. So the question now is whether the additional relaxation will have the desired effect. Other Asian countries which have tried to reverse declining birth rates – among them Hong Kong, Taiwan, Singapore, South Korea, and Japan – have found it difficult to do so.

To encourage Chinese couples to have more babies, the Politburo said it would reduce what families have to spend on education, provide subsidies, offer better child-care facilities, expand maternity benefits, and “protect the rights of women in employment”.

A poll conducted by a state news agency found that only 5% of respondents would consider having three children. As is the case elsewhere, many Chinese women today delay marriage and child-bearing in order to pursue careers. Other factors working against having more children include long working hours, as well as the high costs of both housing and education.

To maintain economic growth China will have to persist with high levels of spending on industrial investment. But coping with the changes in the country’s demographic structure will require increases in social investment as well.

The Politburo may find that it is much easier to impose a brutal and coercive policy than to undo its damaging consequences.            

* John Kane-Berman is a policy fellow at the IRR, a think-tank that promotes political and economic freedom. Readers are invited to take a stand with the IRR by clicking here or sending an SMS with your name to 32823. Each SMS costs R1. Ts and Cs apply.