Shenzhen shows challenge of reversing China's demographic decline despite high birth rate

Shenzhen, known as the birthplace of China's economic explosion, has the highest birth rate among its major cities. PHOTO: REUTERS

SHENZHEN (REUTERS) - From her four-bedroom flat in an affluent Shenzhen neighbourhood Sharpay Huang, 28-years-old and four months pregnant, is already weighing up how long to wait before having a second child.

After graduating from a United States college, starting a banking career and getting married, her confidence is typical of many young professionals in the thriving southern technology hub.

"About half the people I know from high school are married, and most of them have kids or are planning to have kids," she said.

While Ms Huang's enthusiasm would be welcomed by policymakers eager to reverse a sharp decline in China's birth rate, she is the exception rather than the rule.

Shenzhen may have the highest birth rate among major cities in the country, but Dr Yi Fuxian, a specialist in China's demographics at the University of Wisconsin-Madison, estimates it is less than half the 2.1 children per woman needed to maintain the population long term.

If such a birth rate is elusive for China's "miracle" city, known as the birthplace of China's economic explosion and now the entrepreneurial home of high tech, it does not bode well for other cities that lack Shenzhen's resources.

China's demographic decline, a legacy of its four-decades-long one-child policy, is a source of rising concern to officials. Like in other fast-greying countries, it puts more onus on the working-age population to support the economy.

While the government is keen to reverse the decline, economists say a drop in the number of marriages and a rise in divorces, a lack of government financial support for new parents, together with a long-term slowdown in economic growth, have made reversing the slide in the birth rate difficult.

The birth rate dropped an alarming 15 per cent last year as China battled the Covid-19 outbreak, which emerged late in 2019.

The government plans to announce details on Tuesday of last year's once-in-a-decade census. On April 29, it quashed reports the census would reveal China's first population decline in 50 years, saying the population continued to grow.

'Model' metropolis

Shenzhen government figures in 2019 showed it had the highest birth rate among China's major cities with 21.7 babies for every 10,000 of its 13.44 million population. That is in part because a large proportion of its population are of childbearing age.

But Shenzhen is struggling to meet many of the aspirations of would-be parents. Its education system is stretched. Fewer than half of 16 year-olds can find a public school place. There are similar shortages of primary school spots in some areas after the number of primary school pupils doubled between 2015 and 2019.

Mr Ren Zhengfei, the founder of Shenzhen-based tech giant Huawei Technologies, has said a lack of school places makes it hard to tempt company staff posted overseas back to the city. Shenzhen is crammed into 2,000 sq km - a third of Shanghai and an eighth of Beijing - so it is difficult to find room for more schools, Mr Nie Xinping, a top city official said in December.

The local government nevertheless has plans to add an extra 740,000 school places by 2025, up from 2.3 million in 2019. "The government has worked hard, first catching up with building nurseries, then primary schools, now high schools - we're trying to catch this generation as it gets older," said a researcher with a government-affiliated think-tank, who declined to be identified as he was not authorised to speak to the media.

Shenzhen's education situation reflects wider challenges for parents across the country, reckons Mr Zhang Zhiwei, the Shenzhen-based chief economist at Pinpoint Asset Management. "Without effective reform on education, it would be difficult to alleviate parents' anxiety and improve the replacement rate, even in a city like Shenzhen with great economic prosperity and other public services," he said.

High living costs and the highest housing prices relative to income of any city in China also weigh on wannabe parents in Shenzhen. Other major cities like Beijing, Shanghai and Guangzhou have experienced substantial rises in house prices too. The Shenzhen city government declined to comment.

Dr Yi expects the high cost of raising children in Shenzhen to push births down. "Many young people are unable to get married," he said. "It is difficult for young couples to raise one child, let alone raise two children."

Ms Quan Quan, a 33-year-old masseuse in Shenzhen, illustrates Dr Yi's point. She leaves her eight-year old daughter with her parents in her hometown near the central city of Chongqing, 1,400km away. Ms Quan's experience is typical of millions of workers across China who do not have access to local government services, such as free state schooling for their children, because the authorities control the number of residency permits to limit pressure on local resources.

"Her teachers are good back home, and life is cheaper there, but of course it can't compare with Shenzhen, it's like heaven and earth," she said.

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