China raises retirement age amid aging population, dwindling pension

Karah Rucker

IN A MAJOR POLICY SHIFT –

CHINA IS SET TO INCREASE ITS RETIREMENT AGE FOR THE FIRST TIME IN 70 YEARS. 

THIS CHANGE COMES AS THE COUNTRY GRAPPLES WITH AN AGING POPULATION AND A DWINDLING PENSION FUND.

CURRENTLY – CHINA’S RETIREMENT AGES ARE AMONG THE LOWEST IN THE WORLD.

ON FRIDAY –

CHINA’S TOP LEGISLATIVE BODY APPROVED A NEW PLAN TO GRADUALLY RAISE THE STATUTORY RETIREMENT AGE STARTING NEXT YEAR.

UNDER THE NEW POLICY –

MEN WILL SEE THEIR RETIREMENT AGE CLIMB FROM 60 TO 63 –

WHILE WOMEN IN BLUE-COLLAR JOBS WILL HAVE TO WORK UNTIL THEY’RE 55 – UP FROM 50. 

AND WOMEN IN WHITE-COLLAR POSITIONS WILL RETIRE AT 58, INSTEAD OF 55.

THE CHANGE WILL BE PHASED IN OVER THE NEXT 15 YEARS. 

THE POLICY AIMS TO ADDRESS A PRESSING ISSUE: 

A RAPID DEPLETION OF THE PENSION FUND.

BY 2035, CHINA’S STATE PENSION FUND IS PROJECTED TO RUN OUT OF MONEY –

ACCORDING TO THE STATE-RUN CHINESE ACADEMY OF SOCIAL SCIENCES.

CHINA’S WORKING-AGE POPULATION HAS BEEN SHRINKING SINCE 2012 –

AND IS EXPECTED TO ONLY GET WORSE.

OVER THE NEXT DECADE – ABOUT 300 MILLION PEOPLE ARE SET TO LEAVE THE CHINESE WORKFORCE. 

THAT’S NEARLY THE SIZE OF THE ENTIRE U.S. POPULATION.

OTHER MEASURES INCLUDED IN THE PLAN INCLUDE –

WORKERS **CONTRIBUTION AMOUNTS INTO THE SOCIAL SECURITY SYSTEM WILL ALSO INCREASE BY 2030.

AND IN 2039 –

A MINIMUM OF 20 YEARS OF CONTRIBUTIONS WILL BE REQUIRED IN ORDER TO ACCESS PENSIONS.

RETIRING BEFORE THE NEW STATUTORY AGE –

WILL BE PROHIBITED – UNLESS AN INDIVIDUAL MEETS THE NEW CONTRIBUTION REQUIREMENTS.

THE PREVIOUS RETIREMENT AGE WAS SET IN THE 1950’S –

WHEN LIFE EXPECTANCY WAS ONLY AROUND 40 YEARS.

POLICY MAKERS SAY THE RETIREMENT AGE INCREASE IS NECESSARY IN ORDER TO STABILIZE THE ECONOMY AND SAVE A DWINDLING PENSION POT.

BUT THAT DOESN’T MEAN THE CHANGES ARE BEING WELCOMED BY ITS PEOPLE –

AS THE NEW LAW WAS QUIETLY INTRODUCED THIS WEEK BEFORE BEING PASSED JUST DAYS LATER.

THE ISSUE OF RETIREMENT AGE ISN’T EXCLUSIVE TO CHINA.

IT’S ALSO AN ISSUE ON THE RADAR OF MANY AMERICANS –

A TOPIC THAT’S BEEN UP FOR DISCUSSION AHEAD OF THIS YEAR’S PRESIDENTIAL ELECTION.

HEY THANKS FOR WATCHING OUR NEW UPDATE.

FOR MORE STORIES THAT MATTER TO YOU –

DOWNLOAD THE STRAIGHT ARROW NEWS APP OR VISIT US AT SAN DOT COM.