Reform aims to address economic strain of aging population, shrinking workforce
China’s top legislative body has approved a proposal to raise the country’s retirement age, set to take effect from January 1, 2025, according to Reuters citing the Xinhua news agency.
This reform aims to address the economic strain of an aging population and shrinking workforce. Currently, China has one of the lowest retirement ages globally.
Under the new plan, the retirement age for men will increase from 60 to 63, while women in white-collar jobs will see an increase from 55 to 58. Women in blue-collar jobs will have their retirement age raised from 50 to 55.
The changes will be phased in over a 15-year period, said the Reuters report.
A majority of older Singaporeans want retirement and re-employment ages to be higher, but expressed concern about "negative employer attitudes" and age discrimination in the workplace.
With life expectancy in China rising to 78 years in 2021, and projected to exceed 80 by 2050, the urgency for reform is clear. At the same time, China’s working population is shrinking, which puts additional pressure on pension systems already struggling with deficits in several provinces, said Reuters.
While the change has raised concerns among the public, it should increase the labour force participation rate, helping to mitigate the adverse effects of population aging, said Xiujian Peng, senior research fellow at the Centre of Policy Studies at Victoria University in Australia.
"The government must take action. If the population continues to decline, the shrinking of the labour force will accelerate, further negatively impacting economic growth,” he told Reuters.
China is leading the world when it comes to the usage of generative AI, with more than four in five organisations there utilising the rapidly developing technology, according to a recent report.
