A decrease in the number of births and an increase in the number of deaths caused the decline. The country's population fell by 850,000 in 2022, bringing the total to 1.41 billion. This is the first decline since the early 1960s and is attributed to China's one-child policy and the impact of the pandemic on fertility demand.
Urbanization on the Rise
The share of the population ages 16 to 59 also decreased from 62.5% to 62%. Despite this, the percentage of the population living in urban areas increased from 64.72% to 65.22%. According to the World Bank, this is still lower than the 83% of the US population that lives in urban areas.
Opportunities in the Changing Demographics
Despite the negative impact on China's long-term growth potential, the changing demographics present opportunities for companies. Smaller family sizes will drive the transformation and upgrading of consumption, and the "silver economy" associated with aging trends will be another growth point. As the pandemic subsides, there may also be a short-term return to population growth.