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Sunday, March 21, 2010
 
 
ARTICLES  &  COMMENTARY
Bleak Prospects for China's Aging Population
 
Difficulties facing China's aging population include a lack of a national pension system and limited familial resources.
 

The People's Republic of China will also undergo dramatic aging in the decades immediately ahead. Between 2000 and 2025, China's median age is set to rise very substantially: from about 30 to around 39. According to projections by the United Nations Population Division (UNPD), in fact, China's median age will be higher than America's in the year 2025. The impending tempo of population aging in China is very nearly as rapid as anything history has yet seen: far faster than what was recorded in the more developed regions over the past three decades, exceeded only by Japan. There is a crucial difference, however, between Japan's recent past and China's prospective future. To put the matter bluntly, Japan became rich before it became old; China will do things the other way around.

China's impending aging process promises to generate problems of a sort that Japan does not have to face. The first relates to its national pension system: Japan's may be financially vulnerable, but China lacks one altogether. Only about a sixth of the contemporary Chinese workforce is covered by government or enterprise-based retirement programs-and nearly all of the pieces in this haphazard patchwork are amazingly unsound in actuarial terms. Although Chinese leadership has been committed since 1997 to establishing a sturdy and universal social security system, to date actions have lagged far behind words, and the system remains only in the planning stage.

For most aging Chinese today, the pension system is known as the family-and even with continuing national economic progress, the Chinese family is likely to be placed under mounting pressure by the swelling ranks of seniors. As of 2025, there will be nearly 300 million members of China's 60-plus population-but the cohorts rising into that pool will be the same people who accounted for China's sub-replacement fertility patterns in the early 1990s and thereafter. Absent a functioning nationwide pension program, unforgiving arithmetic suggests there may be something approaching a one-to-one ratio emerging between elderly parents and the children obliged to support them. Even worse, from the perspective of a Confucian culture, a sizeable fraction-perhaps nearly one in four-of these older Chinese will have no living son to rely upon for sustenance. Even worse: simple calculations suggest that among China's women turning 60 in the year 2025, nearly one out of three will have no living son. One need not be a novelist to imagine the intense social tensions such conditions could engender (to say nothing of the personal and humanitarian tragedies).

Second, and no less important: there is no particular reason to expect that older people in China will be able to make the same sort of contributions to economic life as their counterparts in Japan. In low-income economies, the daily demands of ordinary work are more arduous than rich countries: the employment structure is weighted toward categories more likely to require intense manual labor, and even ostensibly non-manual positions may require considerable physical stamina. According to official Chinese statistics, nearly half of the country's current labor force toils in the fields, and another fifth is employed in mining and quarrying, manufacturing, construction, or transport-occupations not generally favoring the frail. Even with continuing structural transformations, regular work is sure to be much more strenuous in China than in Japan in 2025. And China's older population may not be as hardy as peers from affluent societies-people likely to have been better fed, housed, and doctored than China's elderly throughout the course of their lives.

Hard data on the health status of older people in China and other countries tend to be spotty and problematic-and comparability of method can never be taken for granted. However, some of the survey data that are available through REVES (Reseau sur l'esperance de vie en sante), the international network of "health expectancy" researchers, are thought-provoking. According to a 1989-1990 "health expectancy" study for the Sichuan province, a person 60 years of age would spend less than half (48 percent) of his or her remaining years in passable health. (That study, incidentally, seems to have been heavily weighted toward relatively privileged urban groups: in the rural part of the sample, the corresponding figure was barely 40 percent.) By contrast, a study for West Germany for 1986 calculated that a 60-year-old woman could expect to spend 70 percent of her remaining time in "good health"; for men the fraction was 75 percent. Although one probably should not push those findings too hard, they are certainly consistent with the proposition that China's seniors are more brittle than older populations from more comfortable and prosperous locales.

Thus, China's rapidly graying population appears to face a triple-bind. Without a broad-coverage national pension system, and with only limited filial resources to fall back on, paid work will of necessity loom large as an option for economic security for many older Chinese. But employment in China, today and tomorrow, will be more physically punishing than in OECD countries-and China's older cohorts are simply less likely to be up to the punishment. The aggregation of hundreds of millions of individual experiences with this triple bind over the coming generation will be a set of economic, social, and political constraints on Chinese development--and power augmentation--that have not as yet been fully appreciated in Beijing, much less overseas.

Nicholas Eberstadt is the Henry Wendt Chair in Political Economy at AEI. This essay draws on a longer study by the author titled "Population and Power in Asia," published in the journal Policy Review.

 
 
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