Source: NYT (4/27/21)
A Graying China May Have to Put Off Retirement. Workers Aren’t Happy.
Most Chinese workers retire by 60. But with the population aging and pension funds running low, the government says that must change.
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By Vivian Wang and Joy Dong
An auto assembly line in Wuhan, China. China has some of the lowest retirement ages in the world. Credit…Ng Han Guan/Associated Press
For Meng Shan, a 48-year-old urban management worker in the Chinese city of Nanchang, retirement can’t come soon enough.
Mr. Meng, who is the equivalent of a low-level, unarmed law-enforcement official, often has to chase down unlicensed street vendors, a task he finds physically and emotionally taxing. Pay is low. Retirement, even on a meager government pension, would finally offer a break.
So Mr. Meng was dismayed when the Chinese government said it would raise the mandatory retirement age, which is currently 60 for men. He wondered how much longer his body could handle the work, and whether his employer would dump him before he became eligible for a pension.
“To tell the truth,” he said of the government’s announcement, “this is extremely unfriendly to us low-level workers.”
China said last month that it would “gradually delay the legal retirement age” over the next five years, in an attempt to address one of the country’s most pressing issues. Its rapidly aging population means a shrinking labor force. State pension funds are at risk of running out. And China has some of the lowest retirement ages in the world: 50 for blue-collar female workers, 55 for white-collar female workers, and 60 for most men.
The idea, though, is deeply unpopular. The government has yet to release details of its plan, but older workers have already decried being cheated of their promised timelines, while young people worry that competition for jobs, already fierce, will intensify.
And workers with blue-collar or physically demanding jobs like Mr. Meng’s, who still make up the majority of China’s labor force, say they’ll be worn down, left unemployed or both.
The announcement was made during the annual meeting of the national legislature, and afterward retirement-related topics trended for days on Chinese social media, racking up hundreds of millions of views and critical comments.
Census workers in the Chinese region of Tibet in October. China’s population is aging rapidly. Credit…Roman Pilipey/EPA, via Shutterstock
Around the world, raising the retirement age has emerged as one of the thorniest challenges a government can take on. Russia’s attempt to do so in 2018 led to President Vladimir V. Putin’s lowest approval ratings in years. Mr. Putin eventually pushed the plan through but granted concessions, a rare move for him.
A pension reform plan in France prompted a prolonged transportation strike last year, forcing the government to shelve the proposal.
The Chinese government itself abandoned a previous effort to raise retirement ages in 2015, in the face of a similar outcry.
This time, it seems determined to follow through. But it has also acknowledged the backlash. Officials appear to be treading gingerly, leaving the details vague for now but suggesting that the threshold would be raised by just a few months each year.
“They’ve been talking about it for a long time,” said Albert Francis Park, an economics professor at the Hong Kong University of Science and Technology who has studied China’s retirement system. “They’ll have to really exercise quite a bit of resolve to push it through.”
China has been hurtling toward a retirement age crisis for years. The current standards were set in the 1950s, when the average citizen was expected to live until only his or her early 40s.
But as the country has swiftly modernized, life expectancy has reached nearly 77 years, according to World Bank data. Birthrates have also plummeted, leaving China’s population distinctly top-heavy. More than 300 million people, about one-fifth of the population, are expected to be over 60 by 2025, according to the government.
Most Chinese families depend on grandparents for child care. A later retirement age could complicate such arrangements. Credit…Wang Zhao/Agence France-Presse — Getty Images
The result is what experts call a serious threat to China’s continued economic growth and ability to compete. In Japan and many European nations, residents become eligible for pensions at 65 or later. At a recent news conference, You Jun, the deputy minister of human resources and social security, said China risked a “waste of human resources.”
The backlash has underscored a host of other anxieties in Chinese society about issues such as job security, the social safety net and income inequality.
The hypercompetitive environment that defines many white-collar workplaces in China is already grinding on Naomi Chen, a 29-year-old financial analyst in Shanghai. She has often discussed with friends her wish to retire early to escape the pressure, even if it means living more modestly.
The government’s announcement only confirmed that desire. China already struggles to provide enough well-paid white-collar jobs for its ballooning ranks of university graduates. With fewer retirees, Ms. Chen worries, she would be left working just as hard but with less prospect of a payoff.
“Getting promoted will definitely be slower, because the people above me won’t retire,” she said.
In reality, older workers may suffer more. China has modernized so quickly that they tend to be much less skilled or educated than their younger counterparts, making some employers reluctant to retain them, Professor Park said. In several industries, including tech, 35 is seen as the age ceiling for being hired.
Some young workers in China fear that pushing back the retirement age will have repercussions for them, and not just in the long term. Credit…Gilles Sabrié for The New York Times
Delaying retirement also risks undermining another major government priority: encouraging couples to have more children, to slow the aging of the population.
In part because of inadequate child-care resources, the vast majority of Chinese rely on grandparents to be the primary caretakers for their children. Now, social media users are asking what will happen if the older generation is still working.
Lu Xia, 26, said the prospect of later retirement made it impossible to consider having a second child. More children would eventually mean more grandchildren to care for, even as she was expected to keep working.
“With delayed retirement, it’s hard to imagine what we’ll have to face by the time that we are grandparents,” said Ms. Lu, who lives in the city of Yangquan, southwest of Beijing.
Unless China increases support for child care, new parents may leave the work force or postpone childbirth until their parents retire, exacerbating the labor shortage, Feng Jin, an economist at Fudan University, told a state-backed labor publication.
Still, experts maintain that the cost of inaction would be too high. A 2019 report by the Chinese Academy of Social Sciences predicted that the country’s main pension fund would run out by 2035, in part because of the dwindling work force.
A clothing factory in Jiangsu Province. Chinese officials have suggested that retirement ages would be raised gradually, by a few months per year. Credit…Chinatopix, via Associated Press
That has alarmed some young people, who wonder where their own pensions will come from if nothing changes.
“I think this is pretty fair,” Wang Guohua, a 29-year-old blogger in Hebei Province, said of pushing back retirement ages. “If people are still alive but there’s no more money, that will affect social stability.”
Mr. Wang added that he did not see the appeal of retiring at 60, given how much life expectancy had increased: “You won’t have anything to do.”
Indeed, Bian Jianfu, who retired recently from his job as a manager at a state-owned enterprise in Sichuan Province, said he would not have minded working a few years longer. His pension would have increased, too.
Mr. Bian receives about $1,000 a month, more than double the average for urban retirees. He praised the government for consistently raising pension payments over the past decade though some experts have acknowledged the strain that doing so has added to the system. “The Chinese government treats retirees very well,” he said.
But that security is unevenly distributed, and it is likely to remain so even if the government shores up its pension funds.
Mr. Meng, the urban management worker, is paid about $460 a month, one-tenth of which he pays toward pension and basic medical insurance funds. When he finally retires, he expects to draw $120 to $150 a month.
He acknowledged that it was barely enough to live on. But he said he could make it work — even if he was now increasingly unsure when the date would come.
“All I can do is hold on,” Mr. Meng said. “Keep holding on until I’ve reached the right age.”
Mahjong in a Beijing park. The government has continued to raise pension payments for retirees. Credit…Thomas Peter/Reuters