The Chinese working population born during a baby boom in the 60s will enter retirement, putting higher pressure on pension funds and social problems.
Banyuetan, a journal under China’s Xinhua News Agency, recently published an article stating that in the next 10 years, an average of 20 million people will retire each year.
According to mainland media, the first impact of the retirement wave is the significant decline of the working-age population.
Peng Xizhe, Dean of the Institute of Aging at Fudan University, pointed out that in the tide of retirement, more than 20 million people will retire every year. The new labor supply is estimated at 17-18 million a year, so the working-age population will be reduced by more than 3 million every year.
In China, the legal retirement age for men is 60. For women, it is 55 for white-collar workers and 50 for blue-collar workers. This means that in 2022, those men born in 1962 will reach the statutory retirement age, and most female workers born in 1972 will also retire this year.
According to international standards, a nation is classified as an aging society when those of 60 years old and over account for at least 10% of the total population.
According to Chinese government’s data, as of the end of 2021, China’s population aged 60 and above was about 267 million, accounting for 18.9% of the national population.
In an analysis, the “Tianjun Politics and Economics” team said that China has experienced three baby booms since 1949. The first baby boom appeared shortly after that year when the government implemented a policy of encouraging births and the population grew by nearly 300%.
The second occurred after 1962, peaking in 1965, after the Great Leap Forward movement led to a nationwide famine.
At that time, 250 million people were born in 10 years. It is the main baby boomer with the largest number of births in Chinese history and the greatest impact on the economy later.
The third baby boom occurred between 1986 and 1991 when the second boom began to start a family and enter the reproductive age.
According to the “Tianjun Politics and Economics” team, people born in the second baby boom will begin to retire in 2022. The number of new births in the future will be less than 10 million, while the number of new retirees will exceed 20 million a year, and the trend will expand.
Su Jian, director of the National Economic Research Center of Peking University, predicted that, after 2022, China’s labor force will decrease sharply. And that will inhibit China’s economic growth from the supply side.