over the last 60 years.

For most of it, births are high.

But in 2022, China had more deaths than births

causing its population to decrease

for the first time in 6 decades.

To get why this is such a big deal, consider this:

China is the world's manufacturing superpower

and that's in large part because of its huge population.

Nearly 30% of the country's economic output

comes from manufacturing.

Now, here's China's population over the last 60 years.

Even after losing almost a million people in 2022

its population is still about as big as it's ever been:

1.4 billion people.

But that's projected to shrink by nearly half

by the end of the century.

Over the years, China's growth and policies

have contributed to its population decline.

Today, it's looking to reverse course

to keep its population steady.

The problem is it might be too late.

In the 50s, under Mao, China experienced

one of the most gruesome famines on record.

30 million people died.

If we look at that on the birth and death rates chart

you'll see a big spike in deaths.

At the same time, the birth rate dropped

causing the population to shrink.

But, as often happens with wars, famines, and other major crises

immediately after, there was a baby boom.

Combined with global medical advances

that decreased infant mortality rates

China's average family now had 6 children.

The birth rate had skyrocketed

which the government saw as a big problem.

The Chinese leadership realized

the population was growing too fast

and something needs to be done.

The government came out with a policy...

They called it “Later, Longer, Fewer”.

Later marriages, longer birth intervals, and fewer births.

As a result, China's birth rate started trending down...

but it wasn't low enough for China's leaders.

And in 1980, they implemented the extreme one child policy

which limited most families to one child.

That policy was also backed up by very harsh measures.

There were campaigns of sterilization...

IUD insertion and induced abortions.

And while these campaigns began during the Later, Longer, Fewer era

they were at their worst under the one child policy

when China sterilized 20 million men and women

and induced nearly 15 million abortions in a single year.

But China had accomplished its goal.

Population growth was under control.

Except, as China would soon realize

these restrictive policies worked a little too well.

In order for any population

to stay the same size in the long run

each couple needs to have, on average, 2.1 children.

This is called the replacement rate.

The idea is that one child replaces one parent

and that 0.1 makes up for children who die

before they become adults.

But China has had a fertility rate

that's far below 2 for over 3 decades.

To bring that up

in 2016, China finally ended the one child policy.

And after briefly trying out a three child policy,

in 2021 they finally let families have as many children as they'd like.

But it hasn't worked.

One big reason is the unique family structure

produced by the one child policy.

We're looking at what's called a 4-2-1 family structure

with a couple having 4 parents above them and 1 child below.

Most countries have diverse family structures

some with 3 kids, others with none.

But with China's 4-2-1 model

millions of only children are under increasing pressure

to care for their aging parents and elderly grandparents.

And this can make having multiple children even harder...

especially as the cost of living keeps rising.

A recent survey revealed that more than 50% of young people

don't want more than one child

because of financial and work pressures.

We have seen cash subsidies for additional birth

longer maternal leaves...

subsidies for kindergarten

and all sorts of monetary support.

Well, the thing is, almost none of them have worked

because having a child is exceedingly expensive

and it's a lifelong commitment.

And so it's really actually hard...

to put a price on this.

But China's population crisis isn't just about babies.

It's also about the balance between young and old.

If we look at population pyramids that show distribution by age...

we see that countries like Kenya

with rapid population growth look like this:

wide at the bottom

representing a lot of new young people, and narrow at the top.

Countries experiencing slower growth

like the Philippines, are still triangular.

But the difference between top and bottom is less pronounced.

Now take a look at China, and notice the narrow bottom, so, fewer babies.

And the heavy top: a larger number of elderly people.

Which is a happy...

outcome of our improvement

in health and in standard of living

but combined with sustained low fertility...

that just produces sustained population aging.

In 2050, that pyramid is projected to look like this.

And that will further drive down China's population

shrink its labor force and put the whole country

in a uniquely difficult position.

In the 80s, China became a hotspot for foreign investment

cheap manufacturing and exports.

A generation later, it was shooting up the ranks

and becoming one of the world's leading

and fastest growing economies by GDP.

But not only did that economic modernization

drive birthrates down further, it also didn't

translate to an equally strong economy for everyone.

If we look at the GDP per capita

the best indicator we have for standard of living

China is much lower than these high income countries.

China became a major world economy nearly overnight

but it's still a middle income country.

Many, especially in rural areas

haven't benefited much from China's economic boom...

and China has yet to develop the necessary safety nets

to support its aging population.

To build the social infrastructure...

like the social programs in health care and in pensions...

It takes time.

And that's getting...

actually tougher with the economy that's slowing down.

And a slower economy will inevitably redefine

China's role in the world as a manufacturing superpower.

What this means for China, for the world

is that the resource constraints from within...

would also constrain Chinese ambition...

and its global reach.

In some ways, China isn't alone.

A lot of Asian and European countries

are experiencing population declines, too.

What makes China different is how fast this all has happened.

It was only 40 years ago

that China started leveraging its booming population

to become an economic superpower...

all while still trying to stem population growth.

Now that China's population growth is officially over...

China may have to rethink its future

not just as a global superpower

but for its citizens at home too.