China could release tens of millions of people into its urban workforce by increasing agricultural productivity, demographers said, which could help offset its demographic crisis caused by a declining population and a rapidly aging society. The agriculture sector accounted for 23% of China’s total employment by 2021, compared to just 3% in high-income countries. Releasing 10 percentage points of China’s rural workforce could lead to an increase of 78 million urban workers, which is more than the total labor force of Pakistan or Russia, according to Cai Fang, Chief Demographic Expert at the National Think Tank. “The shrinking of the total number of laborers could be offset by structural adjustments,” former Chinese Academy of Social Sciences (CASS) Vice President Cai said at the China Finance 40 Forum. Last year, the number of China’s urban jobs dropped by 8.4 million to 459.31 million, which was the first drop in six decades, as the working age population fell. A large number of agricultural laborers in rural China are still engaged in small-scale family farming, while the level of industrialization and productivity remains low and growth remains shallow, further compounding the urban-rural income divide.
“As the labor productivity increases in agriculture and a surplus of laborers could be transferred, the labor potential could be further released and have a positive effect on China’s economic growth rate,” said Wang Yiming, Vice Chairman of the China Center for International Economic Exchanges. That would be one of the keys to address China’s plummeting birth rate and a shrinking labor force, while technological breakthroughs, including the recent advancements in the field of AI, will also help offset the dwindling labor force, demographers argued. “As a result, the negative population growth will bring down the supply of labor, while on the other hand intelligent technologies will reduce the demand for labor, while productivity will naturally continue to rise,” added Wang, who is a former Deputy Secretary General of the National Development and Reform Commission (NDRC).
For the first time in six decades, deaths outnumbered new births in China last year, with India set to become the world’s most populous nation. Last year, China’s birth rate fell to a record low of 6.77 per 1,000 people, while the overall population fell by 850,000 to 1.4118 billion. Chinese mothers gave birth to 9.56 million babies – the lowest total in modern history and the first time the figure had dipped below 10 million. China’s working-age population, defined as those aged between 15 and 64, reached a peak of 74.5% in 2010, but has since steadily dropped, prompting concerns over a shrinking workforce and its potential ramifications for economic growth, the South China Morning Post reports.
