It’s no secret that many countries face looming demographics problems as their populations age.

Much has been written about developed markets like Japan, Germany, and Italy, which have the largest percentages of their populations age 65 and up.

But another country also deserves attention: China.

In a recent note to clients, a Bank of America Merrill Lynch team led by Beijia Ma shared a chart showing that China’s working-age population — aka people 15 to 59 — has already started shrinking and is set to continue to decline.

The BAML team wrote in the note:

“For China to rise to be the world’s #2 economy, the country saw its working-age population expand by 380mn people between 1980 and 2015. During this time, millions of people from rural China migrated to cities for urban manufacturing jobs. While this has pushed China to be the world’s largest manufacturing economy in 2010, it is expected to peak in 2017.”

But “by 2050, the size of China’s population will decline by around 60mn, while the working-
age population will decline by 212mn or around 1/3. This is the size of the current population of Brazil, the world’s 5th most population nation,” they noted.

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This is particularly startling given that China’s also going to have a huge over-65 population in the near future — meaning that it will see the same kinds of problems as aging developed markets like Japan.

In March, a report on the global-aging phenomenon from the US Census Bureau illustrated some comparisons between China’s over-65 population and the total population of several big developed markets:

  • In 2015, the number of older people in China (136.9 million) exceeded Japan’s total population (126.9 million).
  • By 2030, Japan and Egypt’s combined total projected populations (231.8 million) will be smaller than China’s projected 65-and-up population (238.8 million).
  • And by 2050, China’s projected older population (348.8 million) will be approximately equal to the combined total projected populations of Japan, Egypt, Germany, and Australia.

The Census Bureau report also included population pyramids, which illustrate the sex and age breakdown of a country’s population, for China in 2015 and 2050. The most striking thing in the charts is the huge growth in the over-65 category, which you can see below:

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Another thing that stands out is the relatively small population of younger people, which is partially because of the one-child policy introduced in the late 1970s. And even though the government recently retired it, the impact from that won’t be seen for some time.

Putting this all together, in the coming decades there will be far more older residents who will likely want to retire and fewer working-age citizens to support them, assuming that the projections hold.

Historically, aging populations have generally been a problem that more developed markets like Japan have had to deal with, rather than emerging economies like China, as we have noted before. So, the graying of China could present new problems and opportunities that we haven’t seen in other markets before.