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Below is an excerpt from a new Demography Unplugged research note written by Hedgeye Demography analyst Neil Howe. Click here to learn more and subscribe.

China's Birthrate Drops to An All-Time Low - zchina

In 2019, the birthrate in China fell to 10.48 births per 1,000 women: the lowest rate since the PRC was founded 70 years ago. The country’s demographic challenges are only getting tougher and are threatening to completely rewrite the social contract between the old and the young. (The New York Times)

Neil Howe: China's birthrate--the average number of births per 1,000 women--has dropped to an all-time low. By "all time" we mean the lowest since the People's Republic of China began issuing statistics in 1949. It may in fact be the lowest rate going back many centuries.

Ditto for the total fertility rate (TFR)--the single-year estimate of the number of children a woman will have over her lifetime. China's TFR continues to slog along at 1.6, conspicuously below the replacement rate of 2.1. Meanwhile, the total number of births continues to fall (to 14.6 million). Since the founding of the PRC, only the year 1961 had fewer births, but this occurred under extreme conditions: It was the last year of the Great Famine. And of course back then China’s population was considerably smaller.

Why are total births falling even though the TFR remains unchanged? Simple. As China's population pyramid hollows out at the base, there are ever-fewer women in high-fertility age brackets. So even unchanged age-related fertility is generating fewer births.

Five years after lifting its one-child policy, China is mired in a demographic conundrum that feels like a slow-motion car accident. Though it’s hardly alone in facing the challenge of low fertility, it is one of a handful of countries where kids are expected to take care of their aging parents and grandparents in lieu of a strong social safety net. At this rate, there just won’t be enough young people to look after the elderly or support the economy. The main state pension system is on track to run out of money as soon as 2035.

That the birthrate continues to tick downward despite the government’s best efforts (see “Trendspotting 4/01/19, Keyword: China” and “Trendspotting 5/20/19, Keyword: Pronatalist”) speaks to the larger forces that are persuading young people in China to delay or opt out of parenthood. It’s not just that having a child is too expensive or too time-consuming, that the economic case for marriage is not as strong, or that more women prefer to focus on their careers. It’s all of these things.

The government may succeed in making child-rearing more permissable, but they desperately need a long-term strategy to make it more appealing.

China's Birthrate Drops to An All-Time Low - Jan27 Chart1

China's Birthrate Drops to An All-Time Low - Jan27 Chart2

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ABOUT NEIL HOWE

Neil Howe is a renowned authority on generations and social change in America. An acclaimed bestselling author and speaker, he is the nation's leading thinker on today's generations—who they are, what motivates them, and how they will shape America's future.

A historian, economist, and demographer, Howe is also a recognized authority on global aging, long-term fiscal policy, and migration. He is a senior associate to the Center for Strategic and International Studies (CSIS) in Washington, D.C., where he helps direct the CSIS Global Aging Initiative.

Howe has written over a dozen books on generations, demographic change, and fiscal policy, many of them with William Strauss. Howe and Strauss' first book, Generations is a history of America told as a sequence of generational biographies. Vice President Al Gore called it "the most stimulating book on American history that I have ever read" and sent a copy to every member of Congress. Newt Gingrich called it "an intellectual tour de force." Of their book, The Fourth Turning, The Boston Globe wrote, "If Howe and Strauss are right, they will take their place among the great American prophets."

Howe and Strauss originally coined the term "Millennial Generation" in 1991, and wrote the pioneering book on this generation, Millennials Rising. His work has been featured frequently in the media, including USA Today, CNN, the New York Times, and CBS' 60 Minutes.

Previously, with Peter G. Peterson, Howe co-authored On Borrowed Time, a pioneering call for budgetary reform and The Graying of the Great Powers with Richard Jackson.

Howe received his B.A. at U.C. Berkeley and later earned graduate degrees in economics and history from Yale University.