China announced on Sunday that it will gradually raise its statutory retirement age, which is among the world’s lowest.
The move will allow people to work longer, as policymakers struggle to relieve soaring pressure on pension budgets, which was described last year as a “time bomb”. Indeed, many provinces already face welfare deficits.
The reform has become an urgent issue because life expectancy rose in China to 78 years by 2021, from about 44 years in 1960, outstripping the United States. And, it is projected to exceed 80 years by 2050.
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The news is expected to be welcomed by mature-age and elderly people, given reports recently saying that elderly workers numbers are soaring, as they cannot afford to retire.
Sunday’s announcement came in a key policy document that also rolled out plans to sharpen a strategy to combat the country’s declining birth rate and an ageing population that fell for a second straight year in 2023, and is seen falling for decades.
“In line with the principle of voluntary participation with appropriate flexibility, we will advance reform to gradually raise the statutory retirement age in a prudent and orderly manner,” the authorities said.
The reforms outlined in the document are envisaged to be completed by 2029, they added.
The retirement age is now 60 for men, or five to six years below that in most developed economies, while for women in white-collar work it is 55, and 50 for women who work in factories.
Policymakers had said during the last two years they aimed to raise the age of retirement, but the change will be the first time that workers are able to choose to continue working.
National health authorities expect the cohort of those aged 60 and older to rise from 280 million to more than 400 million by 2035, or the equivalent of the entire current populations of Britain and the United States combined.
- Reuters with additional input and editing by Jim Pollard
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