China’s leaders have floated the idea of raising the retirement age. It hasn’t gone down well

China has announced plans to raise some of the world’s lowest statutory retirement ages as it tries to cope with the consequences of a rapidly ageing population and a pensions funding crisis.

Currently, men in urban areas can retire at 60 and receive a pension from state-backed funds. The retirement age for female urban workers is 50 or 55 depending on their occupation. Rural residents in China fall under a different retirement system.

Beijing’s plans, announced at the weekend, have already generated a fierce backlash.

“In accordance with the principles of voluntariness and flexibility, [we] will steadily and orderly advance the reform of progressively delaying the statutory retirement age,” China’s ruling Communist Party said on Sunday.

The plan, along with some other key reforms, were released in a resolution three days after the country’s leadership concluded China’s third plenum, a major political gathering in Beijing which takes place every five years.

Struggling with declining birth rate and an ageing population, China’s policymakers have been talking about increasing the retirement age for over a decade.

At the 2013 plenum, a top decision-making body of the Communist Party said that it has become necessary to “study and formulate” a policy to delay the retirement age. Eight years later, during the height of the Covid-19 pandemic, China’s cabinet included the policy in its next five-year plan, which means changes could kick in before 2025.

While the government did not announce any details over the weekend, a December report by the Chinese Academy of Social Sciences, a top government think tank, estimated that everyone will be retiring at 65 eventually.

In 2019, the same think tank had forecast that China’s state pension fund would run dry by 2035 because of its dwindling workforce. Years of strict pandemic-related restrictions, which have shrunk the coffers of local governments, could make the pension shortfall even more dire.

Early last year, thousands of elderly people protested in several major cities against big cuts to their medical benefits payments, fearing that local governments were dipping into their individual accounts to cover the shortages in the state pension fund.

Chinese social media reacted angrily to changes to the retirement age, with many expressing their discontent over the prospect of delayed access to their pensions. Younger people also complained that they would have fewer jobs if older workers stayed in the labour force longer.

On Weibo, the hashtag “advancing the reform of delaying retirement age” has been a top trending topic since Sunday.

One of the most-liked comments said: “Please be aware: delaying retirement age only means you can’t receive pension until very late. It doesn’t guarantee you would still have a job before that!”

“Young people have a hard time finding jobs, but elderly people are not allowed to retire. What are you doing? How can [you] dare to encourage people to have three children?” another Weibo user commented, referring to the government’s plans to boost China’s dwindling population.

The unemployment rate among China’s youth has surged to historic highs after the Covid-19 pandemic. Even after the restrictions have lifted, employers continue to pull back on hiring as the economy slows down.

The government’s sweeping crackdowns on sectors from technology and property to private tutoring, once the biggest hirers for college graduates, have eliminated many jobs available on the market. A structural mismatch has exacerbated the issue, as graduates opt for white-collar jobs over blue-collar ones, while factories struggle to hire workers.

Lack of quality jobs could deepen China’s population crisis. Even though the government has relaxed its limit on the number of children allowed per couple, launched national campaigns encouraging families to have more children, and offered financial sweeteners, Chinese people’s willingness to have children is almost the lowest in the world.

The country’s population has shrunk for the past two years, with 2023 marking the lowest birth rate since the founding of Communist China in 1949. Last year, China was surpassed by India as the world’s most populous country.

On Xiaohongshu, China’s equivalent of Instagram, the hashtag “retirement age” has also attracted about 100 million views by Tuesday morning.

“Delaying retirement age on a ‘voluntary basis’? Just like the elder generation was ‘voluntarily’ forced to have only one child or laid off from state enterprises?” said a Xiaohongshu user.