Changes in demographic structure have gradually influenced all aspects of the social economy and industrial development. Here we need to attach great importance to a number of symbolic changes.
The median age of a population, which may reflect the health of a country’s demographic structure, is particularly important to study. In 1980, when China’s reform and opening-up process began, the population’s median age was 22. In the United States at that time, it was 30. The young, open Chinese market was extremely appealing to the U.S. and the rest of the world, and some Western household brand names swarmed into China. By 2015, the median age in both countries was around 38.
Looking ahead to 2050, when the median age in most countries in the western Pacific region will surpass 50, China’s average population will be nine years older than that of the U.S. In other words, in the 70 years from 1980 to 2050, the median age of the U.S. population will have increased by only 12 years or so, which means the U.S. will have some conspicuous advantages. With China’s average age at 50, the gap between the two countries’ relative advantages in terms of demographic structure —especially the implications for the labor force — will be pretty wide.
By 2060 or 2070, the proportion of China’s population to the world total is expected to shrink from the previous 20 percent or so to 8 or 9 percent. Thus the Chinese population’s internal market advantages will be gone.
Last November, a consulting firm in the U.S. said in a report that the U.S. needs to throttle China’s development in every dimension in the next 15 years, particularly in core technological breakthroughs. Why 15 years? One reason is China’s population.
The U.S. is clear that the next dozen years will determine which country will emerge dominant in areas that are tied to innovative capabilities and core competitiveness, and changes in demographic structure act as a brake. As a country’s population ages, its social burden increases, its birth rate steadily declines and its capacity for sustained innovation is reduced.
China has had three baby booms in the modern era. It’s worth noting that a watershed moment came around 2012, when the working-age population — those between 15 and 59 — began to head toward negative growth, and when the country’s annual GDP growth dropped from double-digit to single-digit. Chinese GDP became No. 2 in the world in 2010. Just two years later, it saw growth in the working-age population reversed.
As an aging society becomes a deeply aging one, pressures on social security will not just come from funding issues. The entire society will prove to be inadequately prepared. So pressures on social security must be turned into motivation for industrial progress.
For example, by the end of 2019, there were 1.49 doctors on average for every 1,000 Chinese people. That was when China had a sizable working population and demographic structure. But the country ranked 83rd internationally — a very low level.
By 2035, when the over-60 age group approaches 450 million, and those above age 70 amount to around 240 million, if the number of doctors is not double the present level, it’s hard to imagine how difficult it’s going to be to sustain basic medical care. The picture of society’s basic average medical capabilities will not be pretty.
Meanwhile, the average life expectancy of the Chinese population increased by one year from the 13th Five-Year Plan period to the 14th, reaching 77.4 years. With steadily improving medical guarantees and social security in general, the public is increasingly aware of health.
We estimate that when the country enters its 17th Five-Year Plan period, or around 2035, the average life expectancy of Chinese people will be 80 or so. Seen together with the aforementioned data, people above the age of 60 will see an absolute increase of more than 360 million. Average life expectancy surpassing 80 will mean a rapidly increasing elderly population, and longevity will place more pressure on society’s support resources for the elderly.
The number of people over age 65 continues to grow in China, and the process is accelerating. Data comparisons show it will take China just 21 years to turn from an aging society to a deeply aging one. By comparison, it took Europe more than 100 years. Then, to get from deeply aging to ultra aging, China will require only 11 years.
The following set of numbers will help us better understand what it means to age before getting rich. In 1978, U.S. per capita GDP surpassed $10,000, when those above age 65 accounted for 11.2 percent of the national population. When China’s GDP crossed the $10,000 mark in 2019, those above 65 accounted for 12.6 percent.
In 1990, U.S. per capita GDP reached $24,000, Japan $30,000 and South Korea $27,000. Judging from the perspective of per capita GDP growth and the proportion of the elderly population, the problem of becoming too old before having financial security is extremely serious in China.
To deal with the coming pressures of aging on the country’s industrial structure, China needs deeper deliberation about industrial development.
The time window required for China to build a complete, mature, elder-friendly social network to cope with aging process isn’t large — only about 10 years. That’s insufficient given the speed at which aging is changing the country’s demographics. Both governmental and nongovernmental efforts will be needed on multiple levels to build a governance regime for an elder-friendly network.
At the same time, the country must explore new drivers for growth against the backdrop of aging. Elder-support institutions cannot provide care for the majority of people, so it is therefore inevitable that a diverse old-age service system based on at-home care must be created.
In the labor force, will artificial intelligence replace human workers or create more jobs? The relationship between AI and population is worth careful deliberation and research. Many people believe technology will replace people in many industries — a popular misunderstanding, because technological progress usually brings more job opportunities. AI may actually enable more people to work, but one problem that deserves broad attention from both the government and society at large is preventing the elderly from being marginalized in a time of digitalization. This would waste society’s productive force and capability. dd
Huge business opportunities are associated with an aging country, which will need elderly support industries. But the need won’t translate into actual profits without proper analysis and policy guidance.
Research indicates that the demand for eldercare falls into many categories, each promising business opportunities. Broadly speaking, those opportunities fall into the fields of investment (old-age finance), travel, medical care, housing, health and learning.
It merits special notice that people born between 1962 and 1975 will represent a majority of the elderly population and have sharply differing opinions about consumption when it comes to old-age support. All existing industries should come up with services and products specifically for the elderly and give full play to their own advantages in building an elder-friendly society.
