Ibbitson: China’s population decline poses challenges and opportunities

We need to broaden thinking beyond “more immigration is the solution” to how Canada could adapt to a world of population decline, where fewer higher-skilled Chinese and other groups may wish to come here:

China is reportedly holding back census data because it shows the country’s population has started to decline, years ahead of even the most aggressive predictions.

If so, every game changes: global warming projections, global population projections, geopolitical and economic projections.

The world’s most populous nation is now a nation on the wane.

The Financial Times reported Tuesday that China has delayed the release of its 2020 census, which was expected earlier this month, because the data reveals that China’s population has declined from a peak of more than 1.4 billion in 2019 to less than 1.4 billion now.

If true, this is one of the most momentous events of our time. Many analyses of the geopolitical rivalry between China and the United States are predicated on the assumption of continued Chinese growth and relative American decline.

But it now appears United Nations population projections, which had China’s population peaking in the 2030s before levelling off and gradually starting to decline, were off by more than a decade.

The reason, according to a report this month by the Bank of China, is steadily falling fertility. Even after the ban on more than one child per family was lifted in 2015, China’s fertility continued to fall, to a level well below that needed to sustain the population.

For that reason, Darrell Bricker and I, in our book Empty Planet, predicted that population decline would hit China sooner and harder than expected. The question was how soon and how hard. If the answer to the first question is right now, then China could lose nearly half its population by the end of the century – more if fertility continues to fall.

The decline could have been accelerated by the COVID-19 pandemic, which has suppressed birth rates across much of the world, as couples put off having a child during this period of economic insecurity. A post-pandemic baby boom is unlikely: Past experience shows that once couples put off having a child, they don’t make up for it later on. Instead, they settle for having fewer children than they’d planned.

Population decline will present both opportunities and challenges for China. Environmentally, the news is encouraging: There will be fewer new coal-fired generating stations needed, as the number of people on the grid goes down instead of up.

The problem of labour shortages could be addressed by bringing in temporary foreign workers and improving productivity through automation.

But preserving economic growth becomes difficult when there are fewer young people every year buying their first refrigerator, their first car, their first baby stroller. Fewer young consumers also means fewer taxpayers to sustain the pensions and health care costs of older people, and fewer adult children to look after the needs of aging parents.

Countries that lose population every year stagnate economically: Italy, Spain, Japan. China is the new Japan. And that could lead to problems containing the discontent of an overtaxed, overworked, increasingly frustrated population. China announced this week that it planned to gradually raise the age of mandatory retirement, which is currently 60 for most men.

This delivers a huge competitive advantage to the United States. That country’s fertility rate has also reached record lows. But despite the effort of former president Donald Trump to seal the country’s borders, the U.S. continues to let in immigrants, both legal and illegal.

The U.S. needs to return, as quickly as possible, to its former practice of welcoming a million new permanent residents each year. That may be difficult, given rising nativism among conservatives, but if Americans want to stay ahead in the race for economic and political power, immigration is the not-so-secret weapon.

In any event, as my colleague Doug Saunders noted Tuesday on Twitter, the news about the Chinese census “will help make immigration a seller’s market.” As fertility rates decline in China and other source countries, such as Philippines and India, and as labour shortages grow in China, Japan and elsewhere, the question for immigrant-friendly countries such as Canada will shift from “how many should we let in?” to “how many can we convince to come?”

That is another reasons why former prime minister Brian Mulroney and others are right to maintain that Canada should greatly increase its immigration intake. We need to get them while we still can.

Source: https://www.theglobeandmail.com/politics/article-chinas-population-decline-poses-challenges-and-opportunities/

About Andrew
Andrew blogs and tweets public policy issues, particularly the relationship between the political and bureaucratic levels, citizenship and multiculturalism. His latest book, Policy Arrogance or Innocent Bias, recounts his experience as a senior public servant in this area.

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