China is the first to raise the retirement age. According to Chinese official media, the new plan was passed on Friday and will go into force on January 1, 2025. Over the next 15 years, the retirement ages would rise gradually every few months.For the first time since the 1950s, China has chosen to “gradually raise” the retirement age as the country deals with an aging population and dwindling pension funds.
Proposals to raise the mandatory retirement age for women in white-collar employment from 55 to 58 and for women in blue-collar jobs from 50 to 55 were approved by the highest legislative body. The retirement age for men will increase from 60 to 63.
Right now, China has some of the lowest retirement ages in the world. According to Chinese official media, the new plan was passed on Friday and will go into force on January 1, 2025. Over the next 15 years, the retirement ages would rise gradually every few months.
According to China news agency Xinhua, people would not be allowed to retire before the legal age, but they may postpone it for a maximum of three years. Furthermore, in order to qualify for pensions, workers will need to contribute more to the social security system beginning in 2030. Employees will need to have made 20 years’ worth of payments by 2039 in order to be eligible for pensions.
The proposal also included steps to strengthen senior care and childcare services, safeguard the rights of independent contractors and jobless individuals, and give young people greater employment and entrepreneurial chances.
The reason for these changes, according to Wang Xiaoping, the minister of human resources and social security, is that China’s current retirement plan, which was created in the 1950s, is out of step with the country’s current economic, social, and demographic conditions.
Strain from pensions increases on the China economy
With an aging population and a declining labor force, China is about to increase the mandatory retirement age in order to alleviate the increasing strain on its pension system.
The retirement age in the nation, which hasn’t altered since the 1950s, is currently among the lowest in the world. It is 50 for women in blue-collar jobs, 55 for women in white-collar jobs, and 60 for males.
All residents’ retirement age will eventually rise to 65 under the planned amendments, which should take several years to implement.
A long-awaited change in China
China adopted a plan to raise the retirement age this July at a high-level CPC meeting, with the goal of putting the reform into effect by 2029. According to officials, the procedure would be carried out gradually, with measures to be performed in a “prudent and orderly” manner that will allow for flexibility.
The Chinese Academy of Sciences reported that 65 could be the ultimate retirement age. This choice is being made at a time when demographic shifts are placing a great deal of strain on China’s pension system, which is the biggest in the world with 1.05 billion contributions and beneficiaries.
Health benefits, vacation chances, and the chance to launch a new business or career are all advantages to retiring early. An early retirement might have negative effects on savings and mental health.
The 1.4 billion people living in the nation are aging quickly, in part because of the one-child policy that was in place from 1980 to 2015, which resulted in a dramatic drop in the proportion of people who were working age.
One major factor propelling these reforms is China’s aging population  297 million people in the nation were 60 years of age or older as of 2023; by 2035, that figure is predicted to rise to 400 million. From 44 years in 1960 to 78 years in 2021, life expectancy has increased, and by 2050, it is expected to surpass 80 years.
Experts caution that the current pension system is unsustainable because it is financed by a declining labor force. Pension budget deficits are currently present in eleven of China’s thirty-one provincial jurisdictions, and the Chinese Academy of Sciences has projected that, in the absence of reforms, the system may run out of money by 2035.
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