Core Data Trends and Future Predictions of the Pension System#
1. Population Structure Trend Chart#
Figure 1: Aging Rate Trend (2013-2023)#
- X-axis: Year (2013-2023)
- Y-axis: Percentage of population aged 60 and above
- Data points: Increased from 14.9% to over 20%, with values for 2013 and 2023 marked.
Chart Interpretation: Figure 1 clearly shows the rapid increase in China's aging rate. The proportion of the population aged 60 and above has significantly increased over the decade, indicating a continuous expansion in the scale of pension recipients and an accompanying increase in pension payment pressure.
Figure 2: Changes in the Labor Age Population (2013-2023)#
- X-axis: Year (2013-2023)
- Y-axis: Labor age population (in billions)
- Data points: Decreased from 1.006 billion to 880 million, with values for 2013 and 2023 marked.
Chart Interpretation: Figure 2 shows that, contrary to the rising aging rate, China's labor age population (15-59 years) is continuously decreasing. This indicates a shrinking contributor base, adversely affecting the income side of the pension system.
Figure 3: Total Fertility Rate Trend (2013-2022)#
- X-axis: Year (2013-2022)
- Y-axis: Total fertility rate
- Data points: Decreased from 1.6 to 1.09, with values for 2013 and 2022 marked.
Chart Interpretation: Figure 3 indicates that China's total fertility rate continues to decline and is far below the replacement level. This will lead to a future shortage of young population replenishment, further exacerbating the trends of aging and shrinking contributor base, posing a serious challenge to the long-term sustainability of the pension system.
2. Employment, Insurance Participation, and Replacement Rate Trend Chart#
Figure 4: Actual Participation Rate of Employee Pension Insurance in China (2023)#
- Chart Type: Bar chart
- Single Bar: Actual participation rate of employee pension insurance, about 70%
- Y-axis Label: Percentage
Chart Interpretation: Figure 4 shows that although the number of urban employed people has increased, the actual participation rate of employee pension insurance is only about 70%. This indicates that there is still room to improve the participation rate, especially among migrant workers and flexible employment groups. Increasing the participation rate is one of the important ways to expand the sources of pension income.
Figure 5: Actual Average Pension Replacement Rate Trend in China (2000-2022)#
- X-axis: Year (2000-2022)
- Y-axis: Pension replacement rate (percentage)
- Data points: Decreased from 72% to 44%, with values for 2000 and 2022 marked.
Chart Interpretation: Figure 5 shows a significant decline in China's actual average pension replacement rate. From 2000 to 2022, the replacement rate has nearly halved, indicating that the level of pensions for retirees relative to their pre-retirement wages is decreasing, which may affect their living standards after retirement.
3. Pension Revenue and Expenditure Gap and Forecast Chart#
Figure 6: Structure of Pension Income in China (2022)#
- Chart Type: Pie chart
- Two Parts:
- Premium Income: 4.8 trillion (80%)
- Fiscal Subsidies: 1.2 trillion (20%)
Chart Interpretation: Figure 6 clearly shows the composition of pension income in China for 2022. Premium income is the main source, but fiscal subsidies also account for a considerable proportion (20%). The reliance on fiscal subsidies indicates that the pension system's self-sustaining capacity needs to be strengthened.
Figure 7: Trend of Pension Expenditure Growth in China (2013-2022)#
- X-axis: Year (2013-2022)
- Y-axis: Pension expenditure (in trillions)
- Data points: Increased from 1.8 trillion to 5.8 trillion, with values for 2013 and 2022 marked.
Chart Interpretation: Figure 7 shows that pension expenditure in China has rapidly increased over the past decade, with an average annual growth rate of 12%. The growth rate of expenditure far exceeds that of income, further exacerbating the widening gap between pension revenue and expenditure.
Figure 8: Forecast of Future Pension Surplus in China (2024-2040) (Schematic)#
- Chart Type: Line chart (conceptual/schematic)
- X-axis: Year (2024-2040)
- Y-axis: Pension surplus (in trillions)
- Trend: Starts from a positive value and trends downward, potentially crossing the zero line before 2040, indicating potential depletion.
Chart Interpretation: Figure 8 is a schematic diagram predicting the pension surplus in China based on a dynamic model. According to the analysis, under the influence of accelerated population aging, shrinking contributor base, and slowing economic growth, the pension surplus may show a gradual shrinkage or even depletion trend. It is important to emphasize that this is a schematic trend chart, and more precise predictions require the construction of more detailed mathematical models for quantitative assessment. However, the overall trend points to severe challenges facing the pension system in the future.
I. Core Assumptions of the Model#
| Category | Indicator | Value or Description |
|---|---|---|
| Population Structure | Contributor group (15-59 years) | 2023: 880 million, average annual decrease of 9 million (5 million before 2030) |
| Percentage of population aged 60 and above | 2035: 30% (420 million), may exceed 35% by 2050 | |
| Economic Parameters | GDP Growth Rate | 2024-2030: 4.5%, 2031-2040: 4.0% |
| Wage Growth Rate | In line with GDP (average 4%-4.5% annually) | |
| Policy Interventions | Fiscal Subsidies | Average annual growth of 5% (2022 base of 1.2 trillion) |
| Delayed Retirement | Fully implemented by 2030, extending contribution years by 3-5 years |
II. Key Calculation Results (2024-2040)#
| Indicator | 2024-2030 (Average Annually) | 2031-2040 (Average Annually) |
|---|---|---|
| Growth Rate of Premium Income | 3.5%-4.0% | 2.8%-3.3% |
| Growth Rate of Pension Expenditure | 7.0%-7.5% | 6.0%-6.5% |
| Proportion of Fiscal Subsidies | 25%-30% | 35%-40% |
| Cumulative Gap (2040) | — | Approximately 18 trillion (present value) |
III. Phased Dynamic Analysis#
1. 2024-2030: Accelerated Expansion of the Gap#
| Indicator | Value |
|---|---|
| Premium Income | Reaches 6.5 trillion by 2030 |
| Fiscal Subsidies | Increases to 1.7 trillion by 2030 |
| Pension Expenditure | Exceeds 10 trillion by 2030 |
| Annual Gap | Reaches 2.8 trillion by 2030 |
2. 2031-2040: Systemic Risks Emerge#
| Indicator | Value |
|---|---|
| Labor Age Population | Decreases to 730 million |
| Growth Rate of Premium Income | Decreases to 3.0% |
| Average Annual Growth of Pension Expenditure | 6.3% |
| Fiscal Subsidies by 2040 | Reaches 4.5 trillion |
IV. Sensitivity Analysis#
| Variable Adjustment | Impact on Cumulative Gap (2040) |
|---|---|
| Increase GDP Growth Rate by 0.5% | Gap reduces by 15%-20% |
| Advance Delayed Retirement to 2025 | Gap reduces by 25%-30% |
| Increase Total Fertility Rate to 1.5 | Gap reduces by 10% (long-term effect) |
| Decrease Growth Rate of Fiscal Subsidies to 3% | Gap expands by 50%+ |
V. Policy Recommendations#
- Structural Reform: Complete national coordination and state-owned asset transfer before 2030 to fill historical gaps.
- Parameter Adjustment: Link pension indexation to CPI rather than wages to curb the rapid decline of the replacement rate.
- Multi-tiered System: Increase corporate annuity coverage from 6% to 30%, and expand tax incentives for individual pensions.
- Flexible Retirement: Implement "early reduction, late increase" pension distribution rules to incentivize delayed retirement.
VI. Risk Alerts#
- Population Shrinkage Exceeds Expectations: If the total fertility rate remains below 1.0 for a long time, the gap may exceed 20 trillion by 2040.
- Limited Fiscal Maneuvering Space: After the decline of land finance, the risk of relying on deficit monetization for social security subsidies increases.
- Intergenerational Conflicts Intensify: The post-90s to post-00s generation faces "high contributions, low benefits" intertemporal unfairness.
(Note: The model is based on the current policy framework and does not consider extreme external shocks such as wars or pandemics.)