China will begin raising the retirement age for workers starting next year, aiming at addressing its aging population and shrinking workforce. The new policy, which was approved by the Standing Committee of the National People's Congress, marks the first adjustment to the retirement age since the 1950s. The decision is seen as a critical step in managing the demographic pressures that have increasingly strained China's economy and social welfare systems.
Currently, China has one of the lowest retirement ages among the world's major economies, with men typically retiring at 60, women in blue-collar jobs at 50, and women in white-collar jobs at 55. Under the new policy, the retirement age will gradually increase over the next 15 years. By 2039, men will retire at 63, while women will retire at 55 or 58, depending on their job type.
The policy change comes as China grapples with a rapidly aging population. By the end of 2023, the country had nearly 300 million people over the age of 60. That number is expected to swell to 400 million by 2035, surpassing the current population of the United States. This demographic shift has placed immense pressure on China's pension system, which experts warn could run out of money by 2035 if no changes are made.
"The pension fund is facing high pressure due to the growing number of retirees, which is why this policy adjustment is necessary," said Xiujian Peng, a senior research fellow at Victoria University in Australia, who specializes in China's population and its economic impact. The previous retirement age policies were established in the 1950s when life expectancy in China was around 40 years-significantly lower than today's average of 78.2 years.
The gradual implementation of the new retirement age will begin in January 2025, with adjustments made every few months based on workers' birthdates. For instance, a man born in January 1971 will be able to retire at 61 years and 7 months in August 2032, while another born in May 1971 will retire at 61 years and 8 months in January 2033.
Despite the policy's long-term necessity, it has sparked a mix of reactions among the Chinese public. A 52-year-old Beijing resident, identified only by his surname Lu, expressed support for the change, stating, "I view this as a good thing because our society is getting older, and in developed countries, the retirement age is higher." Conversely, Li Bin, a 35-year-old event planner, voiced her disappointment, lamenting that the increase in retirement age for women in white-collar jobs reduces her "play time" after retirement.
The announcement has also generated a wave of anxiety on Chinese social media platforms like Weibo. While some users acknowledged the inevitability of the policy, others expressed frustration and skepticism. "In the next 10 years, there will be another bill that will delay retirement until we are 80," one user predicted. Another highlighted the challenges faced by middle-aged workers, noting, "Middle-aged workers are faced with pay cuts and raised retirement ages. Those who are unemployed find it increasingly difficult to get jobs."
The policy change is also being viewed in the broader context of China's demographic crisis. The country's population has been in decline for the second consecutive year, with a shrinking birth rate exacerbating the problem. The one-child policy, which was in place for decades, has contributed to the current demographic imbalance, leaving China with fewer young workers to support an increasing number of retirees.
Researchers measure this burden using the dependency ratio, which compares the number of people over the age of 65 to those under 65. In 2022, China's dependency ratio was 21.8%, meaning roughly five workers supported one retiree. This percentage is expected to rise, placing an even greater burden on the working population.
The shift in retirement policy, while necessary, comes at a time of economic uncertainty. China's youth unemployment rate remains high, and the overall economy is softening. As the country transitions into this new phase, it will need to balance the immediate challenges with the long-term benefits of a more sustainable pension system.
Despite the concerns, experts agree that the policy is a step in the right direction. "This is happening everywhere," said Yanzhong Huang, a senior fellow for global health at the Council on Foreign Relations. "But in China, with its large elderly population, the challenge is much larger." As China navigates this demographic transition, the success of this policy will depend on its ability to implement it effectively while managing the economic and social implications for its aging workforce.
