China will gain another 300 million pensioners: will the country be able to pay everyone’s pensions?

China will gain another 300 million pensioners: will the country be able to pay everyone’s pensions?


China got old before it got richer and there are fears that the lack of care and money for the elderly will become a full-blown humanitarian crisis within a few years.




Ask 72-year-old farmer Huanchun Cao about his retirement and he will react with a raucous laugh.

He takes a drag on his homemade cigarette, frowns and tilts his head, demonstrating that the question seems absurd.

“No, no, we don’t have a pension,” he says, looking at his wife.

Mr. Cao belongs to a generation that witnessed the birth of Communist China.

And like many rural and migrant workers, he has no choice but to continue working and earning a living, as he cannot rely on the country’s social welfare network.

A slowing economy, reductions in government programs and the decades-long one-child policy have created a growing demographic crisis in Xi Jinping’s China.

Pensions are deteriorating and the country is falling behind in the race against time to raise enough funds to support the growing number of elderly people.

About 300 million people, currently aged between 50 and 60, are expected to leave China’s workforce over the next decade.

Who will take care of them? The answer depends on where you go and who you ask.



Graph on the aging of the Chinese population

Cao and his wife, married for more than 45 years, live in the northeastern province of Liaoning, a former industrial center of China.

Vast areas of plantations and mined hills surround the province’s main city, Shenyang. Clouds of factory smoke fill the horizon, along with some of the best-preserved Qing Dynasty world heritage sites in the country.

Nearly a quarter of the population here is 65 or older. A growing number of working-age adults are abandoning work in heavy industries in search of better jobs in larger cities.

Cao’s children have also moved away, but are still close enough to visit their parents often.

“I think I can only keep doing this for another four or five years,” says Cao, after he and his wife return from collecting wood.

Inside the house, flames crackle beneath a heated platform, called kangthe main heating source there.



Cao lives in what was the industrial heart of China

“In five years, if I am still physically strong, I may be able to walk on my own. But if I am weak, I may be bedridden. That’s all. The end. I suppose I will become a burden to my children. They will have to take care of myself.”

This is not the future that Guohui Tang, 55, wants. Her husband had an accident on a construction site and her daughter’s university studies have depleted all her savings.

So the former excavator operator saw elderly care as an opportunity to finance her own old age. She opened a small nursing home about an hour from Shenyang.



The nursing home that Tang runs is his retirement plan

Pigs and geese welcome you at the back of the single-story house surrounded by plantings. Tang grows food to fill the meals of six nursing home residents.

Animals are not pets: they are also food.

Tang points to a group of four elderly people playing cards as the sun illuminates the small conservatory.

“Look at that 85-year-old man: he has no pension, he depends entirely on his son and daughter. The son pays one month, the daughter pays the next month, but they also have to support themselves.”

She is worried because she will also have to depend on her only daughter.

For generations, China has relied on the pity of children to fill gaps in elderly care.

But there are fewer sons and daughters for elderly parents to rely on – one reason is the one-child policy, which prevented couples from having two or more children between 1980 and 2015.



Residents of the nursing home created by Tang: many have no income

With rapid economic growth, young people have also moved away from their parents, leaving a growing number of older people to fend for themselves or rely on state payments and assistance.

But the pension system could run out of money by 2035, according to the Chinese Academy of Sciences, a state agency. And this was an estimate from 2019, before the pandemic-induced shutdowns, which hit China’s economy hard.

The country could also be forced to increase the retirement age, which is one of the lowest in the world: 60 for men, 55 for women in clerical jobs and 50 for those in more manual jobs.

But economists say this would be an insufficient measure to prevent what some fear could become a humanitarian crisis within 25 years.

However, depending on the income of the elderly person, the situation is not so dramatic, although it also involves choices.



Fengs are more comfortable than the average Chinese elder

“Welcome to my home,” says Grandma Feng, 78, who preferred to be identified only by her last name.

It’s hard to keep up as she runs down the hall to tell her husband that visitors are going to their room at the Sunshine Care Home.

She just finished her morning fitness class where she laughed and gossiped with her friends.

The house was built to accommodate more than 1,300 residents. About 20 young people volunteer to live here for free in exchange for their help in caring for some elderly people.

Private companies partially finance the house, relieving pressure from the local government.

It’s an experiment as policymakers search for solutions for an aging China. Here in Hangzhou, southern China, it is easier to afford these efforts.

This is a different world to Liaoning: the shiny new buildings going up are home to tech companies like Alibaba and Ant, a magnet for ambitious young entrepreneurs.

The Fengs have been here for eight years. The nursing home is welcoming and there is a lot to do, such as gymnastics, table tennis, singing and theatre.



There are plenty of activities to keep Sunshine Care Home residents busy.

“It’s very important to be able to spend the last part of your life in a good place,” Feng says.

She and her husband have been married for over 50 years. It was love at first sight, they say.

When their grandson graduated from high school, they decided their homework was done.

“There are few people our age who think like us,” Feng says.

“It seems like we care more about enjoying life. Those who disagree think you don’t need to pay a lot of money to live here while having your own home.”

But he says he is “more open-minded.”

“I’ve been thinking about it. I just gave the house to my son. Now all we need is our pension cards.”

The couple’s room in the nursing home costs about 2,000 yuan (about R$1,400) a month. As former state-owned company employees, both have pensions sufficient to cover costs.

What they receive is much higher than the average pension in China, about 170 yuan a month (R$120) in 2020, according to the International Labor Organization.



The conditions of Tang's clients, poor and often without pensions, contrast sharply with those of Sunshine Care Home's clients

However, even though it has customers with decent pensions, Sunshine Care Home is making a loss. The director says nursing homes are expensive to start with and take time to turn a profit.

Beijing has pushed private companies to build nursing homes and infirmaries to fill gaps left by debt-laden local governments.

But will companies continue to invest if profits are far away?

Other East Asian countries, such as Japan, are also seeking funds to care for large numbers of elderly people.

But in this case the country was already rich when it began to become one of the oldest populations in the world.

China is aging rapidly without this support. Therefore, many seniors are forced to follow their own path, at an age when they should be planning for retirement.

Shuishui, 55, has found a new career in what’s called the “silver-haired economy.”

“I think what we can do is try to influence the people around us to be more positive and continue to learn. Everyone may have different levels of family income, but whatever the circumstances, it’s best to try to be positive.”

Shuishui knows he is part of a privileged group in China. But she is determined to hope for the best. The former businesswoman is now a recently graduated model.

On the sunny banks of the Grand Canal in Hangzhou, she and three other women, all over 55, touch up their hair and makeup.



Shuishui (first from left) poses for a photo with her friends

Each chose her own traditional Chinese clothing in red or gold: floor-length silk skirts and short fur-lined coats to ward off the spring chill.

These glamorous grandmothers are models for social media.

They struggle to balance in high heels on the historic cobblestone Gongchen Bridge, smiling at the camera as a social media team shouts instructions.

This is the image of graceful aging that Shuishui wants the world to see, and he feels he is doing what he can to turn around a struggling economy.

But this image belies the reality of millions of elderly people in China.

Back in Liaoning, wood smoke rises from chimneys, signaling lunchtime. Cao is stoking the fire in his kitchen to heat water to prepare rice.



Cao and his wife say they don't want to leave their village to live in the city

“When I’m 80, I hope my children come back to live with me,” he says as he searches for a frying pan.

“I won’t join them in the cities. Their house doesn’t have an elevator and you have to climb five floors. It’s harder than climbing a hill.”

For Cao, this is simply the way things work. He has to keep working until he can’t do it anymore.

“Ordinary people like us live like this,” he says, pointing to the fields outside that are still covered in ice.

Spring will bring back planting season and more work for him and his wife.

“If you compare this to life in the city, it is clear that farmers have a more difficult life. How can you earn a living if you can’t stand the harshness?”, he asks, facing a future full of questions.

Source: Terra

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