China’s birth rate fell to a record low in 2025, underscoring the deepening demographic challenges facing the world’s second-largest economy despite an expanding array of government incentives aimed at encouraging families to have more children.
Official data released on Monday showed that China’s birth rate declined to 5.63 births per 1,000 people in 2025, the lowest level since the founding of the People’s Republic of China in 1949. Over the same period, the death rate rose to 8.04 per 1,000 people, the highest since 1968, reflecting the country’s rapidly ageing population.
As a result, China’s total population fell by 3.39 million to about 1.4 billion by the end of 2025, marking the fourth consecutive year of decline and a faster contraction than in 2024. The latest figures confirm that the modest rebound in births seen last year was short-lived.
According to the National Bureau of Statistics, just 7.92 million babies were born in 2025, a drop of 1.62 million, or roughly 17%, from the previous year. Births had declined for seven consecutive years through 2023 before a brief uptick in 2024, widely attributed to the Year of the Dragon, traditionally considered auspicious for childbirth. By contrast, 2025 was the Year of the Snake, often viewed less favorably for having children, though state media previously sought to downplay such beliefs.
Beijing has spent nearly a decade trying to reverse the downward trend. In 2016, authorities ended China’s decades-long one-child policy, allowing couples to have two children. When that failed to produce a sustained increase in births, the limit was raised to three children in 2021.
More recently, the government has rolled out financial incentives, including cash subsidies of 3,600 yuan (about $500) per child for families with children under the age of three. Several provinces have gone further, offering additional baby bonuses, extended maternity leave, and housing or education-related benefits.
At the same time, policymakers have adjusted the tax system to encourage child-rearing. Kindergartens, daycare centers and matchmaking services have been added to tax-exemption lists. In contrast, contraceptives such as condoms and birth control devices were removed from a value-added tax exemption list, subjecting them to a 13% tax from January 2025 — a move that sparked public debate and concern over unintended pregnancies and public health risks.
Despite these measures, analysts say structural pressures continue to outweigh policy incentives. China has one of the lowest fertility rates in the world, estimated at around one birth per woman, far below the replacement level of 2.1. Comparable economies in East Asia, including South Korea, Japan, Singapore and Taiwan region, face similarly low fertility rates.
Raising children in China remains costly, particularly in major cities. A 2024 report by the Beijing-based YuWa Population Research Institute found that China ranks among the most expensive countries globally in which to raise a child, factoring in housing, education and childcare expenses.
Many young Chinese cite economic uncertainty, intense competition in education and the workplace, and a desire for personal freedom as key reasons for delaying or avoiding parenthood altogether.
“I have very few peers who have children,” a Beijing resident told the BBC in a previous interview. “And if they do, they’re obsessed with finding the best nanny or getting their kids into the best schools. It sounds exhausting.”
The demographic downturn carries significant consequences for China’s long-term economic prospects. The country now has about 323 million people aged 60 and above, accounting for roughly 23% of the population. As the working-age population continues to shrink, fewer workers will be available to support a growing number of retirees.
This shift comes as China attempts to transition from labor-intensive manufacturing toward a more consumption-driven and high-tech economy. While advances in automation, robotics and artificial intelligence may help offset labor shortages, economists warn that a shrinking population could weigh on overall growth and consumer demand.
“A shrinking population implies a smaller consumer base in the future, increasing the risk of wider supply-demand imbalances,” said Yue Su, principal economist at the Economist Intelligence Unit, adding that the pace of the population decline is striking in the absence of major shocks.
China reported annual economic growth of 5% in 2025, according to official figures, but many analysts expect growth to slow in the coming years as demographic headwinds intensify.
The ageing trend is also putting pressure on public finances. The Chinese Academy of Social Sciences has warned that the country’s pension system faces mounting strain, with existing funds at risk of depletion unless reforms are implemented. Economists say China will likely need to broaden its tax base and overhaul pension and social security systems to cope with rising elderly care costs.
United Nations experts project that China’s population will continue to decline throughout the century, potentially falling by more than half by 2100. For now, policymakers appear to be running out of time to engineer a demographic turnaround.
Researchers argue that beyond cash subsidies, deeper reforms are needed, particularly in the workplace. “Young women want policies that ensure they are not penalized for having children,” said Stuart Gietel-Basten, director of the Center for Aging Science at the Hong Kong University of Science and Technology. “It shouldn’t be a massive career penalty.”
The prolonged downturn in China’s property market is also weighing on household confidence and family-planning decisions, analysts say, further dampening birth rates.
Official data released on Monday showed that new home prices continued to fall in December, highlighting persistent strains in the real estate sector despite repeated government pledges to stabilize it.
On an annual basis, prices fell 2.7%, accelerating from a 2.4% drop in the previous month and marking the fastest decline in five months.
Housing has long been a central pillar of household wealth and social security in China, and the sustained correction has eroded both balance sheets and confidence, particularly among younger families. For many prospective parents, home ownership is seen as a prerequisite for marriage and child-rearing, making falling prices, unfinished projects and job uncertainty powerful deterrents to having children.
Economists note that weaker property values can have a cascading effect on fertility by tightening household budgets, reducing perceived economic security and amplifying concerns over long-term affordability — from mortgages to education costs.
As a result, the housing slump is increasingly viewed as an important structural factor reinforcing China’s record-low birth rate, alongside high living expenses, workplace pressures and shifting social attitudes.
