How will China solve its lack of babies?

For the first time since the great famine of the 1960s, China has seen its population decrease. The economic and social consequences of a decline in demography for the world's second largest economy can be colossal.

China's population has lost 850,000 people in 2022. If the decline is confirmed in the years to come, the economic and social plans initially envisaged by the country risk being undermined. As is the case in Japan, the decline and aging of the population may impact the cost of labor, which will be higher. Pensions will become more expensive because there will be more of them, and the country's entire competitiveness could be affected.

The population is falling even though the one-child policy ended in 2015 and China has since taken numerous incentives to boost the birth rate. These include longer maternity leave, housing subsidies in case of birth, subsidies in the form of allowances and the introduction of practices to lower the exorbitant prices of private education companies, etc.

So why is it going down?

Chinese people are feeling the pitch of the rising cost of living, especially in 2022. They have also become accustomed to growing up in small families, and now the desire to have children is lower as a result of the one-child policy.

The country's growth depends largely on its ability to supply the world's labor force: a decline calls into question China's ability to maintain its second rank among the world's economic powers.