When China eased its one-child policy late last year, investors bet on a surge in demand for everything from pianos to diapers. They, and government officials, foresaw a mini-boom after long-constrained parents were allowed a second go at making babies.
So far, however, it is hard to identify a bedroom productivity burst. About 270,000 couples had applied for permission to have second children by the end of May, according to the national family-planning commission, and 240,000 received it. That means that China will fall well short of the 1 million to 2 million extra births that had been predicted by Wang Peian, deputy director of the commission.
The problem is partly bureaucratic. China announced the relaxation of the one-child policy in November: If at least one of two parents is a single child, the couple may have two children.
Provinces began implementing the new rule only in January, however. Fearful of a baby boom that would overwhelm hospitals and, eventually, schools, they have made the application process cumbersome. In the eastern city of Jinan, for instance, would-be parents must provide seven different documents, including statements from employers certifying their marital status.
With 11 million couples suddenly eligible to have second children, some caution over easing policy may be understandable. As the process is simplified, more parents will choose to go through it. Analysts expect additional new births to rise toward 1 million a year during the next decade or so. That is on top of today’s average of 16 million births a year.
All the same, the government and investors have overestimated the pent-up demand for babies. As in wealthier countries, preferences in China have shifted markedly toward smaller families. The cost of raising children has soared in cities, where competition to land a good kindergarten place is fierce. Costly housing puts a premium on living space. Analysts at Credit Suisse, a bank, reckon that it takes roughly US$4,030 a year to raise a young child — almost equivalent to the average annual income in China.
The legacy of China’s one-child policy, now more than three decades old, exacerbates the problem. Grandparents are traditionally a fixture in Chinese households, helping to raise the young. With couples waiting until later in life to have children, however, some parents find that they are looking after both their elders and their newborn. As single children, they have no siblings to lighten the load.
Liu Gang, a 31-year-old events organizer in Beijing, says that he would like a second child, but his wife now has to spend months at a time in Qingdao, her hometown, to care for her sick father. The government is investing in both day-care centers and nursing homes, but provision is woefully short.
China’s fertility rate has fallen to an estimated 1.5 children per couple, in line with the European average but below the 2.1 that maintains a constant population and is more normal for a country at China’s stage of development. With China aging quickly, a higher birth rate is needed to underpin long-term social and economic stability.
In the past the state used harsh methods to stop its citizens from having babies. In the future it will have to find clever ways to encourage people to have them.
Other countries, not least neighboring Japan, have struggled with that.