Big trouble, smaller China.
Adam had an interesting post on Saturday highlighting the problem China has concerning it's coming population decline. The main point is that:
'China's population will peak at 1.44 billion in 2029 and then start a long period of 'unstoppable' decline the following year according to new research from the government'
This of course creates a problem for China as they have to anticipate how to deal with an ageing population and a falling labor force. The simple logic is that more work will be required by less people, which may create unsustainable strains on an economy. There are a couple of key reasons why this is becoming a greater factor for China:
1. People are now living longer. When China introduced it's one-child policy in 1979 the average life expectancy was 66. It is now about 76. See graph below and world bank source files can be found below on the source link.
2. Social strain. In China there is a huge burden on people of child bearing age to look after ageing parents and provide for young children. Many people don't consider themselves able to provide for more than one child, even though China's one-child policy was removed in 2015.
More strain to be borne by fewer people
Here is a breakdown of how the demographics are changing/projected to change in China below. The red section (those 65+) are increasing, whole the yellow section (0-14) is decreasing.
By 2030 over 17.1% of the Chinese population will be over 65. To put this onto perspective the UN define an 'ageing population' to be one where 7% of the population are over 65. Currently around 11.5% of China's population are 65+ and one source I read had only 1.3 young person to support an elderly person be 2050. All of this means that China is going to have to act now to avoid an economic crisis triggered by an accelerating ageing population.
