China’s Population Decline, Increasing Concerns for Economic Future

China’s ‘dragon babies’ the only hope for population decline

In a important demographic shift, China has seen a consecutive decline in its population for the second year in a row, intensifying anxieties about the growth trajectory of the world’s second-largest economy.

China's Population Decline

Newly released data on 17th jan 2024 showed a population of 1.409 billion at the close of 2023, marking a substantial decrease of 2.08 million compared to the previous year. This decline, which has doubled since 2022, emphasizes the challenges faced by China amid its expanding urban class and a historically low birth rate.

Experts contend that this downward trend is expected , due to the country’s growing urbanization and the record-low birth rate. The Chinese government disclosed that the birth rate has now dwindled to 6.39 per 1,000 people, aligning with other advanced East Asian nations such as Japan and South Korea.

China has been facing issues with declining birth rates for some decades, a phenomenon initially spurred by the controversial one-child policy implemented in the 1980s to curb overpopulation. Despite the policy’s repeal in 2015 and subsequent incentives like subsidies and payments, including the 2021 relaxation of birth limits to allow up to three children, the impact has been negligible.

China's Population Decline

Experts opion that economic factors, including the cost of living and career priorities, have contributed to the persistently low birth rates, particularly among the younger population in modern cities. The aftermath of the COVID-19 pandemic has further accelerated the decline, with economic challenges emerging as a paramount factor.

While some classify the population decline to the pandemic’s impact, experts emphasize that underlying economic issues are pivotal. China’s economic woes in 2023, marked by a widespread property crisis, decreasing consumer spending, and record youth joblessness post-pandemic, have exacerbated concerns. Annual data released on 17th jan 2024 shows that the economy grew at one of its slowest rates in more than three decades, with GDP expanding at 5.2% in 2023, the weakest since 1990.

The interconnected challenges of a shrinking population and economic struggles raise questions about the sustainability of China’s once-booming workforce. With an aging population and increased pressure on healthcare and pension systems, the nation faces a pivotal juncture. However, experts argue that China, like other deindustrialized nations, is equipped with the resources and strategies to navigate this transition successfully.

Once the world’s most populous nation, China now faces not only demographic challenges but has also gave up its population supremacy to India, according to the UN, further emphasizing the complex dynamics at play in the global demographic landscape.