Pros and cons of China's two-child policy

An elderly man plays with his grandson in Beijing in 2011. Photo: EPA

Driven by fears over the growth of the elderly population and gender imbalance, the Chinese government put an end to the decades-old one-child policy in 2016, allowing couples to have two children.

The new population policy has hit the spot in the economically developed regions where affluent families' life quality is not affected by raising more children. Meanwhile, it has backfired in the places falling short of public services and resources supply.

Demographers say that the policy adjustment will no longer be the only tool to control the population structure with the economic and social development, despite the fact that the abandonment of the one-child policy has assuredly met the demand of many families eager to have two children.

To a large extent, the Chinese government should see improving the social security system and reasonably allocating the resources as its top priority in its efforts to optimize the country's population structure and quality.

The 47th issue of the Oriental Outlook magazine, which was published on December 15, 2016, ran a cover story, which outlines the landscape of how the new population policy changed China and what problems and potential business opportunities it brought.

Below is the excerpt of the article.

It has been a year since the Chinese government put into effect the new Population and Family Planning Law, which encourages a couple to have two children.

Over 91 million women of childbearing age across China are covered by the new population policy, said Zhai Zhenwu, head of the China Population Association. But among these women, not every one expects to have a second child.

In September 2016, the health and family planning authorities in Yichang, Hubei province encouraged all the Communist Party and Communist Youth League members working for local government agencies and public institutions to take the lead in supporting the two-child policy in an open letter, which promised free services and an extended maternity leave for those planning to have a second child.

The open letter was a reaction to the low birth rate in Yichang, where the average birth rate per woman is less than one baby.

Shanghai, the city with the lowest birth rate in China, did not answer the Chinese government's call, as reflected in the fact that the number of newborn population with local permanent residency status stood at about 100,000, compared with 2014 when 124,100 babies were born, according to Zhou Haiwang, deputy director of the Urban and Population Development Institute of the Shanghai Academy of Social Sciences.

However, there are signs of a baby boom in the populous provinces. Media reports said that from the end of 2015 to the beginning of 2016 a large number of women in the provinces of Shandong, Zhejiang and Guangdong decided to take out their contraceptive rings to have a second baby. Helped by the new population policy, such provinces have seen an obvious increase in the birth of second children. According to statistics from the health and family planning committee of Shandong province, among the 1.116 million newborns between January 2016 and September 2016, 714,000 were second babies, representing an increase of 48.8 percent from a year earlier.

Policy effect to be visible in 2017

There is a view that the end of the one-child policy will hardly contribute to increasing the fertility rate as many young Chinese people care more about their personal development than raising a child especially at a time of rising education costs.

The view is denied by some experts, who believe that it is too early to talk about the policy effect, citing the fact that the whole process of giving birth to a baby normally needs more than a year.

"Because of the preparation and pregnancy, the policy effect will be visible after 15-16 months," said Song Jian, a professor at the School of Sociology and Population Studies of the Renmin University of China. "The policy effect will appear in 2017," said Song, adding that the birth of a second child in 2016 was basically the result of the two-child policy.

Zhai said the proportion of the second children in the newborn population in 2016 jumped to 50 percent in some provinces from the previous 25 percent, adding that a baby boom will occur in 2018 after the implementation of the two-child policy.

At a press conference held in November 2016, Wang Peian, deputy director of the National Health and Family Planning Commission, said that the newborn population would surpass 17.5 million in 2016, which would basically meet the goals of the two-child policy.

Support policies needed

Experts say that the Chinese government needs to roll out a series of support policies in a bid to make the two-child policy come into full play, as some institutions and companies are trying to discourage their female employees from having a second baby due to concerns over the shortage of manpower.

According to media reports, female teachers at a middle school in Henan province were mandated to have their second child one after another. A more ridiculous thing happened at a hospital in Guangdong province, which punished a nurse by suspending her promotion and deducting the bonus all because of her unexpected pregnancy that came short of the hospital's scheduled plan.

Worse still, the two-child policy has elevated the pressure on the hospitals, with the class-A hospitals in the large cities being overwhelmed with the increasing demand for childbirth care.

Beijing's health and family planning committee said that starting from March 2016 the number of pregnant women applying for registration at the city's hospitals jumped to 36,000 from 30,000 in December 2015. The committee considered adding 1,000 beds and 800 midwives as a baby boom is around the corner.

However, the bed shortage is not met at the ordinary hospitals. A doctor at a Beijing-based maternity hospital revealed that the bed occupancy ratio remained low at the low-class state-owned hospitals and privately-owned hospitals due to the lack of reputation. The doctor attributed the phenomenon to the centralization of high-quality resources in top hospitals.

Lack of early-education institutions

The baby boom has also added to the demand for reliable early-childhood education institutions.

The lack of high-quality kindergartens and doubts over the entrenched educational concept of the older generation have forced many young parents to spend more time to educate their little children, said a mother surnamed Zhuang. She revealed that many of her friends became stay-at-home mothers after giving birth to a second child, an outcome she attributed to the short maternity leave that lasts only for 4-6 months.

"So I have no plan to have a second child," said Zhuang.

Zhai said that the shortage of preschool education resources can serve as a major barrier to having a second child.

Data from the Ministry of Education showed that as of the end of 2015 there were 224,000 kindergartens nationwide serving 42.65 million children with a gross enrollment rate of 75 percent. The former head of the ministry Yuan Rengui has admitted that preschool education will face pressure from the implementation of the two-child policy.

Chu Fuling, a professor at the Central University of Finance and Economics, proposed that the families and the government should share the expenditures on a second child's preschool education, adding that the government should see improving the social security system for the preschool education as its top priority.

It is noteworthy that an increasing number of female teachers planning to have a second child is exacerbating the shortage of educational resources when the baby boom comes.

According to a survey conducted by Zhejiang province's educational department, as of the end of 2015, there were 380,000 primary and middle school teachers in service, 64 percent of whom were female teachers. A follow-up questionnaire showed that half of the female teachers at 16 schools had plans to have a second child or bore a second child.

In order to address the issue, Hangzhou, the capital city of Zhejiang province, has established two backup force centers in case of a shortage of teachers caused by the two-child policy.

"In order to deal with the problem, a teacher should not be affiliated to a specific school. Besides, retired teachers need to be re-employed if necessary. But the key to solving the problem lies in improving the teachers' social status and economic benefits and enhancing the recognition of the profession among men," said Chu Zhaohui, a researcher at the National Institute of Education Sciences.

New commercial opportunities

The two-child policy also brings business opportunities to related industries.

In Beijing, there are two streets - one near Beijing Obstetrics and Gynecology Hospital and the other adjacent to Haidian Maternal and Child Health Hospital - famous for deliverers of maternity matron advertisement. Tian is one of them. She exceeded her sales target in 2016, helped by the two-child policy, saying that an experienced maternity matron could earn 10,000-20,000 yuan per month.

With the help of the government, being a maternity matron is an occupational option for the laid-off women.

In 2016, the women's federation in Qiqihar, Heilongjiang province trained more than 200 maternity matrons in 2016 and planned to increase the number to 1,000 in 2017.

"The trainers are hired from Beijing, and the qualified students will be granted with vocational certificates," said an employee at the women's federation.

The two-child policy has also raised demand for big apartments.

"After the implementation of the two-child policy, big apartments are becoming attractive (to families planning to have a second child)," said Yan Yuejin, director of E-house China R&D Institute based in Shanghai.

In the small cities, local governments are inclined to offer preferential policies to this sector, said Yan.

But Zhai thinks that the high housing prices in the first-tier cities will likely curb people's desire of having a second child. Zhai said that China could learn from Singapore's property policy, which gives young couples preferential prices if they buy an apartment near their parents' house.

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