China’s biggest roadblock for continued development is its unfavorable demographic situation – in my homeland there is a concern that as baby boomers retire, the amount of young people will be insufficient to support the nation’s burgeoning ponzi-scheme Social Security System. This of course has to do with unfavorable demographics, a glut of 40/50 year olds. An eerily similar narrative exists in China that has nothing to do with post-wartime sex, and everything to do with an artificially constricted population due to China’s one child policy (1979). As a result, China’s demographic woes (‘oldification’ - 老龄化) are considerably more serious than ours, albeit with a different time frame. 

Unless official statistics are lying – there is good reason to think so. Oft-criticized patricentric traditional values, and illegal births resulting therefrom may be this country’s [demographic] salvation. But first the official story:

• Under 15: 20.3% (2007)
• 15–29: 22.8% (2007)
• 30–44: 26.7% (2007)
• 45–59: 18.2% (2007)
• 60–74: 9.4% (2007)
• 75–84: 2.3% (2007)
• 85 and over: 0.3% (2007)

From the State Census. If one child were ended today, China 2040 would still have around 25% of the entire population over 65, assuming these measurements are correct. However, it’s widely known that One-Child has not been perfectly enforced. There are also legal channels for having more than one child –  a family needs to pay between 7,000 – 8,000Y as a ‘fine’ for a second child. A third child is even more expensive, at 10,000Y+.*

The migrant workers I’ve talked to (largely from places like Sichuan, Anhui, Hubei, or elsewhere in Heilongjiang) describe that ‘just about everyone at home has at least two children, lots of families have more.” They unsurprisingly indicate that this is especially the case if the first child is not a male – “many will keep having children until they have a boy.”**

Why the estimation discrepancies? Chinese census methodology relies on municipal and provincial governments for much of the data collection. Inflated demographics would indicate that the very same individuals have been doing a bad job enforcing the policy.*** Within China, it is widely known that local officials deflate the statistics, no one knows by how much.

International organizations like the World Bank put China’s fertility rate at 1.9 (avg. births per female). Using various types of sampling, they avoid biases associated with outright manipulation of statistics by local officials, but are likely influenced by a population that is accustomed to hiding excess children, or at least sensitive to the topic. The extent of this bias is unknown. 

What’s this mean? Since the misreported / miscounted portion is younger, and will primarily join China’s laboring class, estimates about China’s decreasing relative labor costs should be re-interpreted. There’s still a lot of slack left in China’s excess labor pool, and will be for some time (two+ decades?).  China is not entirely free from other serious problems, but our aprraisals of China’s immediate future as it relates to the labor force should be decidedly more optimistic than official reports would indicate. 

* Rural residents can expect to earn 1,000 – 2,000Y per year if they grow their own food and farm full time; or ~15,000 – 20,000Y if they migrate and work as laborers (though they need to buy their own food on this amount).

** This obviously isn’t news to most people. My own take is that in poorer areas, boys are indeed more remunerative than girls – labor being what it is. That is gradually changing with industrialization (textiles for export, for example, almost exclusively employ women). There’s also a very strong cultural reason – men are viewed as having an obligation to support their parents; women are not (they are however obligated to their husband’s parents). 

** Most districts have “Birth Control Policy” offices, where people are employed to monitor who’s giving birth. They also run programs to the effect that “daughters are okay – you should have daughters.”