After weeks of news outlets teasing China’s first population plummet in five decades, the results are finally in: The country has actually surpassed the 1.4 billion mark, up 72 million people since 2010. The catch, however, is that this is at a growth rate of close to zero (0.53 percent), largely due to falling birth rates, rising costs of raising children, and an increasing focus on careers. Although China’s workforce “remains big” at 880 million, this number has shrunk 40 million over the last 10 years. Meanwhile, the number of people aged 60 and above has grown to a concerning 18.7 percent of the total population, making the average age in China 38.8 years old.
The Jing Take
Unless you’re in the senior care business, China’s graying population isn’t particularly good news. For one, this swelling number of retirees could stunt economic growth, placing pressure not only on the country’s medical and pension systems – the latter forecasted to run out of funds by 2036 – but also on its younger generations, many of whom are only children as a result of China’s one-child policy. While Beijing wants to raise the retirement age, this would create other problems for working adults, making it harder for them to find jobs and rely on their elderly parents for childcare.
Moreover, considering how important Chinese youths are for sustaining global luxury’s growth, their shrinking ranks may hamper consumer spending and efforts to develop new industries. Yet amid this crisis, there may be a golden — or rather, silver — opportunity for brands. iiMedia Research predicts China’s senior economy will reach 5.7 trillion yuan (886 billion) by 2021. Leading less busy lives, these consumers can spend more time and money on leisure activities, tourism, and artwork, as well as fashion and beauty. And conveniently for brands, more are shopping online; in fact, JD.com stated that seniors spent 2.3 times as much as the average user in 2017, while Taobao saw its number of active elderly mobile users jump 29.7 percentage points higher than the average amid the pandemic.
So, while China rallies for more babies, perhaps brands should start targeting its Baby Boomers. Compared to their indebted millennial counterparts, this vast, yet underserved segment have, in a nutshell, what all brands are looking for — well-to-do consumers ready to spend. Ok boomer, it’s your turn. Again.
The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.