CHINA TOPIX

12/23/2024 04:44:51 am

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Postponed Retirement Is Not Able to Solve the Issue of Shrinking Workforce

China's workforce age structure is gradually larger, but postponed retirement will not be able to solve the problem but only make the workforce age structure much larger. Relax birth limit is a way to deal with this problem.

Among the current common reasons for postponed retirement, "shrinking incoming workforce" is one of them. The incoming workforce from 16-25 has been decreased every year since 2004. However, this is not caused by the acceleration of aging society, but it is a result of conducting one child policy for a long time. The shrinking Incoming workforce should be a cause of acceleration of aging society. Some officials apparently exchange the cause and effect.

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There is another social background which is Chinese workforce from 16-59 is currently on the top of the peak, 900 million, and this scale will be lasting to 2015. The peak of aging at 2035 to 2040 will still reach 800 million. In terms of absolute value, it matches Chinese economic scale which means China might be not lack of workforce. There is an international economic trend to reduce labor intensive industry. In a simple word, use fewer workers. At the same time, some research demonstrates that there are nearly 100 million people in China unemployed or underemployment. Economists created a new word "total unemployment" to describe this phenomenon. If total workforce reduces to 800 million, employment problem can be right solved. So step back, will China lack workforce? When? Or from another perspective, can China's workforce market hold so many workforces? The answers are still unknown.

Surely, according to the trend, China's workforce age structure is gradually larger, but postponed retirement will not be able to solve the problem. This will also make the workforce age structure much larger. Relax birth limit is a way to deal with this problem. Obviously, only increase birth rate can increase incoming workforce in the future. It is still not late to relax birth limit now. 

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