Ever Fewer, Ever Older: Taiwan's Population Imbalance

Choosing whether to have children is a matter of personal freedom. Should the government intervene in this decision? Can it intervene? And if yes, how?

This September, Funan Primary School in Fuli Township, Hualien County--a school that was founded half a century ago--was for the first time confronted with the situation of having no new students enroll at the beginning of the school year.

Funan Primary School is not alone. In recent years more and more schools have closed down because of falling student numbers and unspent budgets. Just this summer, 34 primary schools closed down throughout the island, including Yukuang Elementary School in Taipei County's Pinglin Township, which was famous for its excellent field study program.

The dearth of students is expected to get only worse in the next few years because it is a direct result of the dearth of babies, and the overall birthrate among Taiwanese women is falling at an alarming speed.

In 1951, Taiwanese women's birthrate was 7.04; by 2005, it had fallen to 1.12. Only Germany, Austria, and Japan have lower birthrates than Taiwan.

To reverse this negative trend, Taiwan recently made a U-turn from a social policy that promoted family planning to one that encourages "having more babies for the national good."

According to Ministry of the Interior (MOI) statistics, Taiwan reached a demographic turning point in 1983, when the birthrate first fell below the replacement rate of 2.1 (taking infant mortality and the sex ratio into account, for the population balance to be maintained, every woman must have 2.1 children over her lifetime). In 2002, Taiwan joined the ranks of countries with an "extremely low" birthrate. On average, every Taiwanese woman gives birth to 1.3 children.

Trends in Taiwan's population age structure/source: Council for Economic Planning and Development

The three noes

Modern Taiwanese people pursue their own "three noes policy": they don't get married, they don't have children, and they don't raise children.

According to a statistical analysis conducted by the MOI, several factors are contributing to falling birthrates: fewer women are getting married; women's attitudes to having children are changing; late marriages are becoming increasingly common; people are changing how much value they place on marriage, family and raising children; childcare resources and support networks are inadequate; and the cost of bringing up children is becoming excessive. These factors are often correlated.

MOI statistics indicate that Taiwan's singles population continues to grow. The number of singles in the 40-54 age bracket has increased from 220,000 a decade ago to 460,000 in 2005.

In 2005, the Department of Health's Bureau of Health Promotion surveyed unmarried people aged 20 to 39 on their attitudes toward marriage and having children. One in four said that they did not plan to get married, which was a worrisome 16% rise on the year before.

A falling birthrate does not just cause a drop in student enrollment in schools. It is estimated that once a country joins the ranks of nations with an extremely low birthrate, the impact on class sizes is felt in all school grades within ten years, on the size of the labor force within 20 years, and on the next generation's birthrate within 30 years.

A population imbalance has an even more profound and far-reaching effect, and the concomitant aging of the population is the hardest problem to solve.

A falling birthrate coupled with longer life expectancy has resulted in a dramatic aging of the population. Taiwan's population pyramid has turned upside down for the first time in history.

Minister of the Interior Lee Yi-yang notes that last year 7.4 working people supported one person over the age of 65 in Taiwan; by 2026, 3.3 working people will be supporting one elderly person; and if the present trend continues, by 2051 there will be only 1.56 working people for every elderly person. Lee stresses that government coffers have come under increasing strain in recent years and that a further dwindling of the working and taxpaying population is likely to have a critically negative impact on Taiwan's future national economy and national security.

Bringing up and educating a child not only requires a great deal of care and devotion but also costs a lot of money. Creating a family-friendly environment and motivating people to "have children for the good of the nation" is one of the government's most urgent and difficult tasks.

The age explosion

The industrialized countries of Europe began to confront the problem of an aging population as early as the 1970s. Taiwan did not begin to feel aging pressure until the early 1990s.

Nevertheless, while in France it took 115 years for the percentage of the population aged 65 or older to double from 7% to 14%, and in Japan the same transition took only 26 years, Taiwan reached the 7% threshold in 1993 and it is estimated that it will reach the 14% mark in just 25 years, by 2018.

Taiwan's baby-boom generation (those born between 1950 and 1962) will begin to enter old age around 2014. If the birthrate continues to drop, demographers' fears will have been justified.

Lin Wan-i, Executive Yuan minister without portfolio and professor in the Department of Social Work at National Taiwan University, argues that population aging will represent a greater challenge for humanity in the 21st century than global warming, depleting oil reserves, and international terrorism, because from our current perspective it appears that population aging will cause irreversible problems.

It is estimated that as the postwar baby boomers enter old age in the 20 years between 2011 and 2031, Taiwan's elderly population will surge from 2.46 million to 5.66 million, producing an "age explosion."

Lin notes that 2016 will be a pivotal year when both the elderly population and the population of under-15s will reach 3.2 million. After 2016, the demographic structure will be turned upside down, and the elderly population will continue to grow as the young population continues to spiral down.

Fewer and fewer people are getting married and having children. Many modern singles believe that as long as they have a dog or a cat, they will never know loneliness. The photo shows a Sina.com blog book launch event.

Quality trumps quantity

Government authorities are worried about the looming demographic imbalance, but public misgivings about the new birth promotion policy have never abated.

At the Academia Sinica's Assembly of Members held in mid-July, its president Lee Yuan-tseh said that given that energy resources are limited and that Taiwan is the second most densely populated country in the world (with 600 people per square kilometer), "a small reduction in the population would be a good thing." Dr. Lee believes that harping on the possibility that there will be nobody left to take care of the elderly is the wrong way to encourage the public to have children; the right approach--one that will ease the burden on young people--is to "encourage healthy seniors to continue working."

Studies have shown that there is plenty of room for growth in the number of working seniors in Taiwan.

A study conducted by Chou Wen-chi, associate professor in National Chung Cheng University's Institute of Labor Studies, shows that the labor-force participation rate of Taiwan's elderly is pretty low. What's more, in recent years there has even been a trend toward early retirement: the average retirement age in Taiwan's industrial and service sectors is 55; in the public sector it is 56. This means that with an average life expectancy of 76, most Taiwanese people spend two decades at home rocking away their retirement.

In 2004, Taiwan's labor-force participation rate among 50-54-year-olds was 64.3%, among 55-59-year-olds it was 48.6%, and among 60-64-year-olds it was 33.5%. This fell far short of Japan's corresponding participation rates, which were 82.2%, 76.6%, and 54.5%.

But would raising the elderly work-participation rate and adjusting the retirement age really be a panacea for all the demographic problems we face?

In the 1980s, when the baby boomers entered their prime and labor-market competition was intense, the government advocated early retirement to reduce joblessness and create employment opportunities for young people. Faced with the problem of population aging, it is now encouraging late retirement. But modern individuals plan their life and career. Without strong incentives or compulsion, how many people are willing to subordinate their lives to work?

2004 crude birthrates & elderly dependent population ratios/Source: Annual Statistical Report, Ministry of the Interior/Note: "Elderly dependent population ratio" means the ratio of those aged 65 to those aged 15 to 64.

Old but not idle?

Moreover, if the retirement age is to be extended, more job opportunities will first have to be provided to prevent unemployment among the young. At the same time, because the aging process affects people's cognitive skills, learning capacity, ability to concentrate, hearing and vision, the number of jobs suitable for the elderly is limited.

Lin Wan-i points out that the jobs with the greatest growth potential in the 21st century--in the health-service sector, the service industries, e-commerce, transportation, and information technology--are ones for which elderly people generally lack competitive skills.

In fact, efforts to improve demographic quality, make the best use of elderly manpower resources, and raise productivity cannot keep pace with the rapid aging of the population. Lin Wan-i notes that it took Japan 20 years to raise the retirement age from 60 to 65. Twenty years from now, in 2025, the elderly will comprise 20% of Taiwan's population. How can Taiwan's workforce quality be improved fast enough to rise to this challenge? Society is woefully ill equipped to adjust to such rapid change.

Dr. Lee Jia-yan, director of Awakening Kaohsiung, thinks that hoping that the elderly will be able to support themselves and the government's policy of urging people to have children for the good of the nation are simply not enough.

Lee believes that because having and raising children is a lifelong burden, women have no obligation to sacrifice themselves for the state or their families--all the more so because children born today will eventually become adults and grow old. If this argument were carried to its logical conclusion, the number children would never catch up with the old.

That is why Awakening Kaohsiung has linked up with a number of NGOs in southern Taiwan to establish a Coalition for Childless Women, which advocates an eight-point program that includes living in harmony with the earth's environment, shifting our emphasis from quantity to quality, creating the conditions for women to have children free of fear and worry, an affordable daycare system, and creating a pluralistic society with equal opportunities for all.

As people are having fewer and fewer children and growing older and older, Taiwan is about to experience an "age explosion." Are we prepared?

Slow to adapt

"These are all sound proposals as far as they go, but they fail to look at the whole picture," says Lin Wan-i. Everyone understands that quality is more important than quantity, but as far as state policy is concerned, how do we bring about a rapid improvement in the quality of the workforce? Extending the retirement age requires all sorts of supplementary measures, such as altering machinery to make it easier for elderly people to operate and redesigning public facilities. It can't be done overnight.

To meet the crisis, countries around the world are formulating policies to encourage couples to have children. But can government policies turn the tide? Some people think that population policies have never been really effective. In the 1960s, for example, the government's family planning motto was "three are just right; two are not too few," but the main reason Taiwan's birthrate dropped as the government hoped it would was that the transition from an agricultural to an industrialized economy transformed the social environment--a trend that was accelerated by the arrival of the pill. Trying to buck the trend today is as futile as a dog barking at a train.

Yet Lin Wan-yi believes that raising the birthrate is not impossible, as a few success stories, such as the United States and France, show. That said, the credit for America's relatively high birthrate for an industrialized country belongs to its immigrants.

In May, the Washington Post reported that according to the latest US Census report, nearly half of America's children under five "are racial or ethnic minorities."

France's birthrate stopped declining and began to rise again thanks to an incentives-based social policy. In addition to four months' paid maternity leave, French parents get a maternity bonus of NT$30,000 for every child born, and children under age three get a monthly daycare allowance of up at NT$6000. The government gives a monthly subsidy of 750 (NT$31,000) for one year to parents who interrupt their work due to having a third child. France also has an excellent daycare system. Such policies have greatly eased the psychological and material burden on couples with young children.

2004 crude birthrates & elderly dependent population ratios/Source: Annual Statistical Report, Ministry of the Interior/Note: "Elderly dependent population ratio" means the ratio of those aged 65 to those aged 15 to 64.

Where's the beef?

Here in Taiwan, there has been a big influx of foreign spouses since the 1990s, but this has made no perceptible positive difference on the birthrate.

So far only 210,000 foreign immigrant women have had children in Taiwan. The birthrate among Vietnamese immigrant women is 1.5, but among women from mainland China it is only 0.9, which is even lower than the average rate of 1.2 children per Taiwanese woman.

Lin Wan-i notes that mainland Chinese spouses tend to be older than their Vietnamese counterparts. Moreover, having been exposed to China's one-child policy for many years, Chinese women are even less inclined to have children than Taiwanese women.

The carrots couples are offered to encourage them to have children are often empty promises. Like old-age annuity payments, child benefit criteria vary from place to place and from year to year, depending on local governments' financial resources. This year, for example, Hsinchu City--which can fairly be described as generous in this respect--offers a maternity bonus of NT$15,000 for the first child, NT$20,000 for the second, and NT$25,000 for the third and subsequent children. The Taipei City Government offers a NT$500 subsidy per semester to students at public elementary schools who are the third child or upward in their family.

Population policy has been much heralded over the years, but the various government agencies have yet to take a coherent approach. "In Taiwan there's no consensus on what to do about the low birthrate," admits Lin Wan-i. Related issues on which conclusions have yet to be agreed include whether to expand or reduce immigration and whether child and elderly care ought to be the responsibility of the state or of families. Thanks to Lin's efforts to coordinate discussion on these issues, the first steps toward a consensus are finally being taken this year. A population policy white paper is expected to be published next June.

Children of choice

In view of the steadily falling birthrate, in June of this year the government officially proposed a policy to slow this trend. According to Lin Wan-i, policies cannot change what people want but they can create an environment that benefits couples who have children and that lightens their burden.

What can be done to help couples realize their wish to have children? First of all, says Lin, there must be no workplace discrimination against them. The funds for parental leave compensation, which used to be paid by employers, will be taken from the Labor Insurance fund. This will effectively reduce the problem of women being pressured to quit their jobs as soon as they get pregnant.

In the past, few women availed themselves of the two-year unpaid parental leave before their child's third birthday because they were concerned about a loss of income. Therefore, parental leave existed in name only. In the future, subsidized parental leave funded out of the Labor Insurance program ought to encourage many more women to take it. In the case of low-income families, the government will also subsidize nursery and daycare fees for children up to the age of two.

In addition, every effort will be made to improve the quality of childcare, after-school care and similar services so that parents won't have to worry about all this.

Raising workforce quality will require starting with the foundation and working up from there. Five years from now every elementary school class will be down to 29 students, and soon thereafter public secondary schools will also have smaller classes. The long-term goal is to have 12 years of compulsory public education extending into senior high school. Lin Wan-i does not mince words: these incentive programs will cost taxpayers money, but they are a necessary investment in our nation's future strength.

In short, wanting or not wanting to have children is a matter of personal freedom, but wanting to have them but deciding not to out of fear is the responsibility of society as a whole. The goal of population policy ought to be to reduce apprehension and motivate people to give birth to the next generation.