Birth rate declines in China, will the solution be made from cash subsidy?
Posted in :
Beijing
China’s population has decreased for the third consecutive year. According to data from the National Statistics Bureau, China had a total population of 1.408 billion in 2023. Which recorded a decline of 20.8 lakhs as compared to 2022. This decline is the fastest in the last six decades. It is also worth noting that in 2022 also decreased by 13.9 lakhs. This shows that the birth rate in China is steadily decreasing from the mortality rate. Due to which the population of the country is declining. The Chinese government is now taking steps to deal with this situation.
The Chinese government has announced a nationwide childcare subsidy of 3,600 yuan (£ 376) annually for children under 3 years of age. This scheme will be applicable from January 2025 and children born between 2022 and 2024 will also get the benefit. This subsidy will not be considered taxable income nor will it affect the eligibility of poverty aid. The move shows that the aim of the government is to implement this subsidy effectively, not to implicate it in the bureaucracy.
Falling birthplace became national emergency
This new policy is different from previous ways, where the responsibility of promoting population growth was left to provincial and urban governments. In the last few years, more than 20 areas have run small incentive programs, such as housing discounts, monthly allowances and baby bonuses. But no one managed to stop the decline in the population. With this direct intervention, Beijing has made it clear that he considers the falling birth rate not just a demographic worry, but a national emergency. China has a challenge to maintain its economic growth, labor force, pension system and infrastructure of healthcare. The way China’s population is getting old and the youth population is decreasing. Looking at him, there is a danger that China will become old before becoming rich ‘.
Why are people not producing children in China?
There are several reasons for the decrease in population in China, including both social and economic changes.
Reduction in the number of marriage: People in China are now avoiding getting married or getting married late. Due to which the number of children is decreasing. In 2024, only 61 lakh weddings were X, while in 2023 this number was 77 lakhs. This is a big change, which is being seen not only in China but also in countries like Japan and South Korea.
Children raising expenses: It has become very expensive to raise children in China. According to a 2024 report, it costs about 538,000 yuan (about ₹ 62 lakh) in urban China for a child for 18 years. This is 6.3 times more than China’s per capita GDP. For this reason, children are also being called ‘Tunjinshou’ or ‘Gold -eating animals’.
Problems of women at workplace: In China, women have to face discrimination in job after becoming a mother. Many women are fired from the job due to maternity leave or do not get promotion. Although women get 128 to 158 days off, men get very little leave. Due to this, the responsibility of raising children comes to most women.
Pressure of modern life: In modern lifestyle, pressure has also increased for children to raise. Homes are very expensive in cities, there is a lot of competition in education and lack of good and inexpensive childcare. Due to all these reasons, making a family has started to look like a burden. Especially in big cities where the cost of living is very high and safety of salary or job is not the same.
Steps taken by provincial governments
Hohot, Internal Mongolia: Annual subsidy up to 100,000 yuan (£ 10,400) for the second or third child, which is given until the child turns 10 years old. Apart from this, new mothers also get free milk and 3,000 yuan dairy product vouchers.
Tianmen: 12,500 pounds of discounts for parents of third child to buy new houses.
Hangzo: Childcare vouchers were distributed.
Sheenyang and Changchun: Cash subsidy ranging from 1,800 to 3,600 yuan per child annually.
Due to the failure of these efforts
All these incentives look good on paper, but in reality they are very few in front of the huge expenses of raising children. As a mother of Ningzia said, it is difficult for the child to meet the basic needs like diaper and formula milk with these subsidies. These incentives have not been able to bring any major changes for the middle class and poor families. The biggest thing is that these schemes failed to solve those big problems, which are the main reason for not producing children. These are the problems- insecurity of the job, expensive homes, uneven holiday policies and gender discrimination in the responsibility of raising children. In an online survey conducted in 2022, about 90% of the Chinese people said that even if they are given 12,000 yuan annually, which is four times more than the amount given now, they will not think of having more children. This clearly shows that people want more social and economic stability than money.
Why not subsidy not enough
The National Childcare subsidy is an important step taken by the Chinese government. Because this is the first time financial assistance is being provided to increase fertility. Under this scheme, free prescript has also been talked about across the country, which will reduce financial pressure on parents. The biggest advantage of this subsidy is that it is very easy to get. There is no complex application process in this, nor will it be considered taxable income. The National Health Commission estimates that about 2 crore families can benefit from this.
What is the experts?
However, this plan is a good start. Many experts believe that its effect may be limited. According to Emma Zang, a demographic expert at Yale University, until the government does not solve problems like cheap childcare, job security for women and proper paternity leave for men, the effect of this scheme will be very low. South Korea is a great example of this. For decades, the government there has been offering generous infant bonus, housing allowances and leave policies, but still its birth rate is the lowest in the world. This means that once the thinking rate in the society gets deeper, it is almost impossible to change it with money. Social changes are not only through economic encouragement, but for this a big social and structural change is required.
Does cultural change need?
China will have to bring more cultural changes, more than just money to prevent a decline in its population. If China has to deal with this problem, then it will have to eliminate gender inequality, which has been present at both homes and offices for decades. For both the mother and the father, the upbringing will have to be made easier and financially possible. They also have to ensure that they get support from the society. It has to be accepted that each and saint policy not only reduced the size of families, but has also changed the thinking of people about children and family.
The United Nations estimates that between 2024 and 2054, China’s population could be reduced by 20.4 crores. And by the end of the century this number can reach 78.6 crores, which will be the lowest after the 1950s. It is yet to be seen whether the new policies of the government will be able to solve this problem or it will remain only the last attempt.
