This chart shows China's
birth and death rate over the last 60 years. For most of it, births
are high. But in 2022, China had
more deaths than births causing its population
to decrease for the first time
in 6 decades. To get why this is such
a big deal, consider this: China is the world's
manufacturing superpower and that's in large part because of
its huge population. Nearly 30% of the country's
economic output comes from manufacturing. Now, here's China's population
over the last 60 years. Even after losing almost
a million people in 2022 its population is still about
as big as it's ever been: 1.4 billion people. But that's projected to shrink
by nearly half by the end of the century. Over the years, China's growth
and policies have contributed to
its population decline. Today, it's looking to
reverse course to keep its population steady. The problem is
it might be too late. In the 50s, under Mao,
China experienced one of the most gruesome
famines on record. 30 million people died. If we look at that on the
birth and death rates chart you'll see a big spike in deaths. At the same time, the
birth rate dropped causing the population
to shrink. But, as often happens with wars, famines,
and other major crises immediately after, there was
a baby boom. Combined with global
medical advances that decreased infant
mortality rates China's average family
now had 6 children. The birth rate had skyrocketed which the government saw
as a big problem. The Chinese leadership realized the population was
growing too fast and something needs
to be done. The government came out
with a policy... They called it “Later, Longer, Fewer”. Later marriages, longer birth intervals,
and fewer births. As a result, China's birth rate
started trending down... but it wasn't low enough
for China's leaders. And in 1980, they implemented
the extreme one child policy which limited most families
to one child. That policy was also backed up
by very harsh measures. There were campaigns
of sterilization... IUD insertion and
induced abortions. And while these campaigns began
during the Later, Longer, Fewer era they were at their worst
under the one child policy when China sterilized 20 million
men and women and induced nearly 15 million
abortions in a single year. But China had accomplished
its goal. Population growth was under control. Except, as China would soon realize these restrictive policies
worked a little too well. In order for any population to stay the same size
in the long run each couple needs to have,
on average, 2.1 children. This is called
the replacement rate. The idea is that one child
replaces one parent and that 0.1 makes up for
children who die before they become adults. But China has had a fertility rate that's far below 2
for over 3 decades. To bring that up in 2016, China finally ended
the one child policy. And after briefly trying out
a three child policy, in 2021 they finally let families have
as many children as they'd like. But it hasn't worked. One big reason is the
unique family structure produced by the one child policy. We're looking at what's called a
4-2-1 family structure with a couple having 4 parents above them
and 1 child below. Most countries have diverse
family structures some with 3 kids,
others with none. But with China's 4-2-1 model millions of only children are under
increasing pressure to care for their aging parents
and elderly grandparents. And this can make having
multiple children even harder... especially as the cost of living
keeps rising. A recent survey revealed that more than
50% of young people don't want more than one child because of financial and work pressures. We have seen cash subsidies
for additional birth longer maternal leaves... subsidies for kindergarten and all sorts of monetary support. Well, the thing is, almost none of them
have worked because having a child is
exceedingly expensive and it's a lifelong commitment. And so it's really actually hard... to put a price on this. But China's population crisis
isn't just about babies. It's also about the balance
between young and old. If we look at population pyramids
that show distribution by age... we see that countries like Kenya with rapid population growth
look like this: wide at the bottom representing a lot of new young people,
and narrow at the top. Countries experiencing
slower growth like the Philippines,
are still triangular. But the difference between top and bottom
is less pronounced. Now take a look at China, and notice
the narrow bottom, so, fewer babies. And the heavy top: a larger
number of elderly people. Which is a happy... outcome of our improvement in health and in standard of living but combined with sustained
low fertility... that just produces sustained
population aging. In 2050, that pyramid is projected
to look like this. And that will further drive down
China's population shrink its labor force and
put the whole country in a uniquely difficult position. In the 80s, China became a hotspot
for foreign investment cheap manufacturing
and exports. A generation later, it was
shooting up the ranks and becoming one of the world's leading and fastest growing economies by GDP. But not only did that economic modernization drive birthrates down further,
it also didn't translate to an equally strong economy
for everyone. If we look at the GDP per capita the best indicator we have
for standard of living China is much lower than these
high income countries. China became a major world economy
nearly overnight but it's still a middle income country. Many, especially in rural areas haven't benefited much from
China's economic boom... and China has yet to develop
the necessary safety nets to support its aging population. To build the social infrastructure... like the social programs in
health care and in pensions... It takes time. And that's getting... actually tougher with the economy
that's slowing down. And a slower economy will inevitably redefine China's role in the world as
a manufacturing superpower. What this means for China,
for the world is that the resource constraints
from within... would also constrain Chinese ambition... and its global reach. In some ways, China
isn't alone. A lot of Asian and European countries are experiencing population declines, too. What makes China different is how fast
this all has happened. It was only 40 years ago that China started leveraging
its booming population to become an economic superpower... all while still trying to stem
population growth. Now that China's population growth
is officially over... China may have to rethink its future not just as a global superpower but for its citizens
at home too.
