Why China's population has fallen for the first time in more than 60 years

China's population has declined for the first time in more than 60 years, according to the country's National Bureau of Statistics.

By the end of 2022 China's population fell by 850,000 compared with the previous year.

The figure includes only the number of people in mainland China and not territories such as Hong Kong.

According to the bureau, China's population now stands at 1.41 billion people, with 9.56 million births against 10.41 million deaths last year. Men were also found to outnumber women by 722.06 million to 689.69 million.

China's working-age population (between 16 and 59-years-old) totaled 875.56 million, accounting for 62% of the national population, while those aged 65 and older added up to 209.78 million - 14.9% of the total.

The last time China is believed to have recorded a population decline was during the Great Leap Forward, launched at the end of the 1950s.

China has long been the world's most populous nation, but is expected to soon be overtaken by India.

The United Nations (UN) estimated that the world’s population reached eight billion last November, and that India will take top spot from China in 2023.

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Why has China's population size fallen?

The short answer is that the country's birth rate has been falling for a number of years, meaning fewer people are being born.

China's strict one-child policy was one the of the initial reasons behind this, but the ruling was officially dropped in 2016.

Since abandoning the policy, China has sought to encourage families to have second or even third children, with little success, reflecting attitudes in much of east Asia where birth rates are typically low.

Young families are thought to be choosing to have fewer children to suit a better work-life balance, while childcare expenses, particularly in cities, has been cited as another reason.

Meanwhile, the Covid pandemic is believed to have delayed some couples from having children, due to the economic uncertainty and disruption created by China's zero-Covid measures.

What does a falling population mean for China?

Though not immediately, a falling population for China could present economic issues for its government should the trend continue in the coming years.

Fewer people will start to enter China's labour market, which in turn will apply pressure on wages and labour costs.

As China's population pyramid becomes more top heavy and begins to age it will also mean the government needs to allocate more funds towards its health and social care systems.

But, if handled correctly, a declining population does not necessarily predict a weaker economy, according to Stuart Gietel-Basten, a professor of social science at Khalifa University in Abu Dhabi.

"It’s a big psychological issue. Probably the biggest," he told the AP news agency.

China, he said, has been adapting to a demographic change for years by devising policies to move its economic activities up the value chain of innovation, pointing to the development of semiconductor manufacturing and the financial services industry.