BEIJING – When Ms Zhou Xiaoying shared on Douyin a screenshot of a 6,500 yuan (S$1,200) cash reward deposited into her bank account by her local government in October 2024, it elicited envious comments from other Chinese mothers.
“I am also from Hubei province, but in our city, how come we get nothing?” wrote one commenter on Douyin, China’s TikTok. “So good? I only received 200 to 300 yuan,” another comment read.
Ms Zhou, 37, who is from Tianmen city in central Hubei province, received the money for having a second child, born in September 2024.
The 6,500 yuan is the first tranche of the 35,300 yuan in cash rewards she will receive over three years, which comes on top of 60,000 yuan in housing subsidies from the Tianmen local government.
Fertility incentives such as cash rewards, tax cuts and maternity leave extensions are determined by local governments and differ from place to place.
The sum is “enough to offset the baby’s daily expenses, but not enough to raise a child”, Ms Zhou told The Straits Times.
“For instance, kindergarten costs about 5,000 yuan a semester, which comes to about 30,000 yuan for three years. And this is just school fees, excluding other expenses,” said Ms Zhou, who recently resigned from her factory job to be a full-time mother.
“For me, it was a lucky coincidence that my second child was born a few months after Tianmen subsidies started in April 2024, but I won’t be having a third child.”
Regardless, the generous cash rewards aimed at encouraging families to have a second and third child have been lauded by many as the main reason that Tianmen, a city of one million people, welcomed 1,050 more newborns in 2024 compared with 2023 – an increase of 17 per cent.
The little-known fifth-tier Chinese city made waves in local media recently for being the first to buck its declining birth rate in eight years, amid a national trend of falling birth rates and an ageing population.
In Tianmen, families who have a third child can get up to 165,100 yuan in cash incentives – higher than the current average of 20,000 yuan in other Chinese regions. There are no incentives for the first child.
Mr He Yafu, an independent demographer in China, said in a WeChat post on Jan 13: “Tianmen’s case proves that cash incentives are making a difference. If childbearing subsidies have no effect, it is because they are too little and the subsidy needs to be increased.”
On Jan 17, China’s National Bureau of Statistics reported that 9.54 million babies were born in 2024, a welcome uptick from 9.02 million in 2023 – the lowest since record-keeping of birth numbers started in 1949.
However, the slight increase in new births was outnumbered by the 10.93 million deaths, which meant that for the third year in a row, China’s population shrank.
Analysts say the modest bump in births in 2024, while encouraging, is a temporary rebound largely driven by unusually favourable social conditions and is unlikely to reverse the course of an ageing and declining population.
Ms Zhou Xiaoying shared on Douyin a screenshot of a 6,500 yuan (S$1,200) cash reward deposited into her bank account by her local government in October 2024. PHOTO: COURTESY OF ZHOU XIAOYING/DOUYIN
Professor Ren Yuan of Fudan University’s Institute of Population Research said that fluctuations in population numbers and annual birth numbers are normal, as much depends on factors such as annual marriage numbers, divorce, migration, employment, post-pandemic recovery, cultural influences and other variables.
The increase in first-time marriages in 2023 had already largely predicted the rise in newborns in 2024, said Prof Ren.
In 2023, the number of marriages rebounded for the first time in nearly a decade, as young couples who postponed wedding plans during the Covid-19 pandemic years tied the knot after China reopened.
The auspicious Year of the Dragon in the Chinese zodiac in 2024 was also viewed as a good year to have children, said Dr Zhao Litao, a senior research fellow at the National University of Singapore’s East Asian Institute.
Dr Zhao said that China’s birth rate will likely revert to its long-term decline in 2025 with fewer babies born, given that marriage registrations declined again in 2024.
“The Dragon Year effect will fade in the Year of the Snake, and the pandemic’s influence on fertility has already dissipated,” said Dr Zhao.
Raising the retirement age was a step in the right direction in adapting policies to the reality of an ageing population, but strengthening pension and healthcare systems is critical to address the challenges of an ageing and declining population, he said.
In January, the retirement age for men was raised to 63 years from 60, and women in white-collar work to 58 from 55 – the first increase since the 1950s.
Prof Ren noted that after more than 70 years of population boom, China is now entering a period of sustained negative growth, driven by persistently low fertility rates, a rapidly ageing population and massive migration causing regional population imbalances.
In smaller cities such as Tianmen, fluctuations in birth rates tend to be even more pronounced due to the relatively small population and the number of women of childbearing age, he said.
Fertility subsidies, such as those given in Tianmen, do not significantly boost people’s willingness to have children but rather help prevent further declines in birth rates, said Prof Ren, citing recent studies.
“But whether substantial subsidies, or those relatively high compared to local living costs, will incentivise fertility intentions and behaviours still requires more research,” said Prof Ren. Therefore, China’s low fertility rate and declining birth numbers are likely to continue in the years to come, he said.
The effects of China’s baby bust are already rippling through its economy. A shrinking labour force, an ageing population and insufficient consumption have led to a slowing economy.
Enrolments in China’s kindergartens plunged by more than five million in 2023, and more than 170,000 pre-school teachers lost their jobs in the same year, official data showed.
Companies that once produced baby formula have reportedly now switched to developing powdered milk for seniors.
China ended its decades-long one-child policy in 2016, increasing the cap to two children, and then to three in 2021. But the policy reversal may have come too late.
Today, many Chinese who are of childbearing age are increasingly shelving marriage and parenthood plans, citing the rising cost of raising a child, lack of caregivers, and unequal child-caring burdens placed on fathers and mothers.
China’s current economic malaise has further left many Chinese anxious about their employment prospects, with youth unemployment remaining high, along with a prolonged property crisis.
Across China, local governments and major companies have in recent years spent more to encourage more families to have children.
In January, Mr He Xiaopeng, the founder of Chinese electric vehicle company Xpeng, said he would give his employees a cash reward of 30,000 yuan if they have a third child.
In 2023, travel site Trip.com Group said it would give its employees 10,000 yuan a year for each child they have until the child turns five.
Professor Lu Jiehua, vice-president of the China Population Association, said that while the trend of an ageing population is irreversible, there is room to strengthen incentives to encourage births.
The main change should be to target subsidies for the first child, instead of the second and third children, as data shows that the majority of newborns infants are firstborn children, said Prof Lu, who is also a professor at Peking University’s Department of Sociology.
“Our policies must grasp this important point and strongly encourage couples to take that first step and have their first child, before they decide on a second or third child,” he said.
- Michelle Ng is China correspondent at The Straits Times. She is interested in Chinese foreign policies, property trends, demographics, education and rural issues.
Join ST’s Telegram channel and get the latest breaking news delivered to you.