ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon PrintIcon Twitter
Society

China's young and old rail against raising retirement age

Move to shore up shrinking labor force raises alarm over jobs and child care

Urban Chinese families often rely on grandparents to bring children to and from school.   © Reuters

BEIJING -- As China's government discusses raising the retirement age to offset the economic impact of its aging population, it faces pushback from a broad cross-section of the population, reflecting its unique family dynamic that often places child-care responsibility on retired grandparents. 

The retirement age for employees in the public sector and at state-owned enterprises is set at 60 for men, 55 for female office workers and 50 for female blue-collar workers. This has remained unchanged since around the time of the founding of the People's Republic of China in 1949, even as life expectancy has risen to more than 80 in urban areas.

The government work report presented to the National People's Congress in March stated that "the statutory retirement age will be raised in a phased manner" as part of the new five-year plan for 2021 through 2025.

Beijing sees this as necessary to alleviate pressure on the social safety net and head off a labor shortage that could set it back in its power struggle with Washington. But resistance is strong from young graduates concerned about the impact on their career prospects as well as from grandparents expected to care for grand children after retirement. 

China's now-abandoned one-child policy has accelerated the aging trend. The working-age population -- those aged 15 to 64 -- peaked in 2013, and United Nations data estimates that this group's share of the overall population will drop below that of the U.S. in 2045.

But the effects will be felt well before then. The oldest men in the baby boom generation that began in 1962, after the Great Leap Forward and ensuing famine, will start reaching the statutory retirement age next year. The share of the population aged 60 and older is projected to top 20% within the next five years.

The Chinese Academy of Social Sciences, a state-affiliated think tank, estimates that the pension fund for urban employees will run out in 2035.

The portion of China's population aged 60 and older is on track to top 20% within five years.   © Reuters

Beijing's five-year plans have touched on the retirement age issue before. The plan for 2011 to 2015 called for looking into flexibly increasing the age at which people can begin receiving pension benefits.

The following plan, which ran through last year, aimed for a shift from study to action, stating that China will "implement policies to gradually increase the retirement age." But almost no progress has been made.

A proposal has been floated to bump up the age by a few months each year, though details have yet to be hammered out. The government also plans to ratchet up the age of pension eligibility at the same time.

The public reception remains chilly.

"If older employees keep working, that takes away that many more job opportunities from young people," said a worried 24-year-old attending graduate school in Beijing.

New graduates already have trouble finding work, a problem that predates the disruption caused by the coronavirus. A 2018 study by delivery app Meituan found that about 15% of its drivers have at least a bachelor's degree.

The higher education enrollment rate, which includes students at universities and vocational schools, has risen to 54% in 2020 from 27% a decade earlier. But even as the swelling ranks of highly educated talent drive up demand for white-collar jobs, the supply has not expanded to match. There is concern that raising the retirement age will only narrow the field further.

A graduation ceremony at Tsinghua University in June 2020: Enrollment rates at universities have risen considerably, but new graduates are having trouble finding work.   © Reuters

Opposition is even more intense among middle-aged workers, who fear that they will end up paying higher insurance premiums for longer, while receiving lower total pension benefits. The government will consider a system to supplement payments based on years of employment, but it has had little success with moving the needle on public opinion.

The strain of self-reliance that runs through modern views of the family -- particularly child care -- poses an obstacle as well.

"I want to leave my job at age 55 and spend my leisure time looking after my grandchildren," said a 54-year-old municipal government employee in Hunan Province.

Two-parent urban households typically need both parents to work to cover the high cost of housing and education, and public child care and preschool capacity has grown more slowly than the broader economy.

A 2017 study by a research team at Japan's Ritsumeikan University found that 88% of families in Shanghai rely to some extent on grandparents to help raise children. Many older people worry about who will bring their grandchildren to and from school if they cannot retire as planned.

The Chinese public generally is not particularly involved in politics, but people are highly sensitive to issues that directly affect their lives and economic interests. President Xi Jinping's government cannot afford to ignore the country's fast-growing population of seniors.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this monthThis is your last free article this month

Stay ahead with our exclusives on Asia;
the most dynamic market in the world.

Stay ahead with our exclusives on Asia

Get trusted insights from experts within Asia itself.

Get trusted insights from experts
within Asia itself.

Try 1 month for $0.99

You have {{numberArticlesLeft}} free article{{numberArticlesLeft-plural}} left this month

This is your last free article this month

Stay ahead with our exclusives on Asia; the most
dynamic market in the world
.

Get trusted insights from experts
within Asia itself.

Try 3 months for $9

Offer ends July 31st

Your trial period has expired

You need a subscription to...

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers and subscribe

Your full access to Nikkei Asia has expired

You need a subscription to:

  • Read all stories with unlimited access
  • Use our mobile and tablet apps
See all offers
NAR on print phone, device, and tablet media

Nikkei Asian Review, now known as Nikkei Asia, will be the voice of the Asian Century.

Celebrate our next chapter
Free access for everyone - Sep. 30

Find out more