China has announced plans to gradually increase the retirement age for both men and women for the first time since the 1950s. Under the new policy, the retirement age for men will be increased from 60 to 65 for five years. Meanwhile, the retirement age for women will rise from 55 to 60.
China announced it would gradually raise its retirement age for the first time since the 1950s. This decision aims to address the country’s ageing population and the strain on its pension system. However, it has been met with mixed reactions.
Currently, China’s retirement age is one of the lowest in the world. The new plan, starting in January 2025, will raise the retirement age for men from 60 to 63 by 2040. For women in white-collar jobs, the age will increase from 55 to 58, while those in blue-collar jobs will retire at 55 instead of 50.
This change comes as China’s population is ageing rapidly. More than 21% of people are over 60, and the country’s working-age population has been shrinking since 2012. The government-backed Chinese Academy of Social Sciences has previously projected that China’s pension funds would run out of money by 2035.
Public Reaction
Acceptance did not seem to be the initial public reaction. On Chinese social media, where several hashtags about the decision led the trending topics. Users complained that they would have to wait even longer to receive benefits that they decried as too low anyway. Others worried that the pension funds would be even more depleted by the time they finally got to retire
The decision announced Friday will also lengthen the time people must pay into pension funds before becoming eligible to receive a monthly pension, to 20 years from 15.
Pressure on social benefits such as pensions and social security is hardly a China-specific problem. The U.S. also faces the issue as analysis shows that currently, the Social Security fund won’t be able to pay out full benefits to people by 2033.
Over the next decade, about 300 million people, who are currently aged 50 to 60, are set to leave the Chinese workforce. This is the country’s largest age group, nearly equivalent to the size of the US population. The question arises: who will look after them?
