Answer Demographics, China's Working Age Population peaked 4 years ago. Since then the working age population of China has been losing over a million people a year.
Long Story Short, it is too late for China, they just don't know it yet.
I'm guaranteeing you supply of labor is not the dominant factor in China's economic climate. The rigged economics of their core competencies has a much larger impact than the availability of cheap workers - labor markets can adjust seamlessly and effectively to less available labor by having the most valuable work done and less valuable work gets delayed. To some degree you have a cutoff valuation where less valuable work is not worth doing - in the west we call it minimum wage. I highly doubt China's economy is anywhere near that threshold yet.
This problem isn't about using robots to refine steel or manufacture iPhones, or have workers magically move up the value stack, it's a question of who will take care of the legions of elderly Chinese. Throw in the fact that China lacks a serious social safety net and the spice of nobody wanting to be an elderly care worker, and you have a full on crises on your hands.
I think parent wasn't saying that supply of labor is the problem now, but that it will be in the future. If thinks are looking bad now, imagine when dependency ratio increases significantly.
It's not just about absolute supply of labor, but also about how much of that labor is being used towards supporting old and young people.
Thanks, I'm often amazed how many people like zanny are incapable of seeing the likely future for societies who's economic and social models are dependent upon constant expansion. At this point in time it is simply too late for most of the EU and Asian nations, it is not a question of if but how the population will react when things begin to unravel. The Demographics of said nation's give us a very good idea of when.
I wasn't clear. Dependency ratio doesn't depend on unemployment, but on people who CAN work vs. people who CAN'T work (elderly, young, sick, disabled, etc.).
It will be interesting to see how more-powerful labour replacements effect these predictions. With the death of Moore's law, perhaps this point is moot, but if we get perfect replacements for intellectual and physical labour, a large population of savers may be ideally placed to benefit from the transition, as perfect mass-produced labour substitutes will likely presage enormous economic growth.
That large population of savers is largely doing so because houses are extremely expensive and the gender gap is so wide that most (of the few) Chinese women can disregard (the very many) men without property and do so without consequence.
So even if this large population of savers were to start spending their money, what are they expected to do with their lives, jack off until they die?
I wonder if this point will hit home to Bay Area engineers who live and work mostly among men and can't afford a house without serious pay or a startup buyout.
>So even if this large population of savers were to start spending their money, what are they expected to do with their lives, jack off until they die?
VR girlfriends? A comfortable retirement as the economy expands. There have been far worse fates in history.
China has between 400 and 500 million fake farmers that are a readily available supply of working age labor.
Supply of labor is the absolute least of China's problems. In fact, they have far too much labor compared to global consumer demand, which is why the bottom 50% of China is so poor.
If China operated its farming as efficiently as South Korea, much less the US, they'd need no more than 30 million farmers. They have hundreds of millions of people producing very little output, and they're kept that way - and without any ability to own their own farms - on purpose because the state has no idea what to do with them if they're not subsistence farmers.
There's no other reason to have referenced their working age population than to talk about what their actual supply of productive labor is.
Losing a mere one million people per year in working age population is entirely irrelevant when you have 400-500 million people sitting on the sidelines available to replace them.
China could improve the efficiency of their farming by 0.25% each year and replace those lost one million working age persons. It's a complete non-issue, they have drastically too many working age persons and nothing for them to do.
>>They have 400+ million 'farmers' with nothing to do. You can't have less of a working age labor problem than that. It proves they have a vast oversupply of working age labor.
>>Unless for some reason you think China needs ~35% of its population to be farmers, while the US needs only 1%, and no other developed nation needs anywhere near that 35% level.
I don't understand where you come off on this kick about Chinese farmers, or why when you think I'm referring to Demographics and working age population that it means they have a problem right now, they don't.
It does not mean they don't have a very real problem in the near future due to having more people that will need taking care of than their economy and society will be capable of handling due to the inverted population pyramid.
I'm not wasting any time teaching you to think about how Demographics shape the future. The Demographics of those rural Chinese farmers you are in love with are aging rapidly, and the generation coming behind is much smaller...
You keep trying to argue on the basis that you need to teach me something. That isn't a data point. If you could back up anything you're saying, you'd bring data to the table instead of constantly using argument from intimidation attempts. Notice that despite disagreeing with you, I don't need to use that kind of language toward you.
China will still have hundreds of millions of farmers doing nothing but subsistence farming 20-30 years from now, unless the state finds something else for those people to do. The demographic curve is not so sharp that it will eliminate hundreds of millions of those farmers from the labor force in just a few decades.
You didn't explain what happens to 400-500 million farmers if you dramatically increase farming efficiency. I can answer it however: you get a surplus of available working age labor to the tune of hundreds of millions of people.
Losing one million working age persons per year, does not matter at all, if you have hundreds of millions doing nothing waiting on the sidelines. They could lose five million per year and it would not matter at all. For the next several decades they will have a surplus of hundreds of millions of people that have nothing to do. It means your proclaimed theory about there being a problem with China losing a million per year, does not matter, they aren't lacking for working age persons at all, now or decades from now.
They have 400 million working age farmers too many. If they lose an average of 5 million total working age persons per year for decades, that means in 20 years they'll still have hundreds of millions of surplus working age persons too many.
From The Article you linked to:
China risks growing old before it gets rich
As China’s population becomes richer and more urban, it's also getting older...
Extend the graphic out a few years and its an inverted pyramid. I'm sorry you're unaware that working age population means much more to a country than simply the supply of labor...
You're not in any way explaining how China has a working age supply problem when they have 400+ million people intentionally being held in subsistence farming because the state has nothing else for those people to do.
They have 400+ million 'farmers' with nothing to do. You can't have less of a working age labor problem than that. It proves they have a vast oversupply of working age labor.
Unless for some reason you think China needs ~35% of its population to be farmers, while the US needs only 1%, and no other developed nation needs anywhere near that 35% level.
Please explain what happens to those 400 million surplus farm workers if China allows their farming efficiency to rise.
Long Story Short, it is too late for China, they just don't know it yet.