Beijing: From childcare subsidies to young innovators propelling artificial intelligence (AI) advances like DeepSeek, the key topics at China's annual "two sessions" reveal how the country is reshaping its demographic dividend by encouraging births and accelerating talent-driven innovation. As China's population continues to decline and age, a raft of measures unveiled in this year's government work report is expected to help sustain demographic resilience in one of the world's most populous countries and unlock its future growth opportunities.
According to Namibia Press Agency, the report, submitted to the national legislature's annual session for deliberation on Wednesday, outlines China's plans to formulate policies on boosting birth rates, provide childcare subsidies, and promote free preschool education in a phased approach. These combined measures aim to ease family financial burdens and help increase birth rates, as noted by Gong Weijuan, a national political advisor and vice president of Yangzhou University.
Despite its population changes, China remains bolstered by its large labor force, with 858 million working-age individuals as of the end of 2024, making up 60.9 percent of the total population. Huang Qunhui, a national political advisor from the Institute of Economics of the Chinese Academy of Social Sciences, emphasizes that the nation's 1.4 billion-strong population, supported by rising incomes and education, holds significant consumption potential and drives consumption upgrades.
While the demographic dividend continues to sustain robust domestic demand and productivity, China is actively cultivating a talent dividend. Education and innovation are increasingly significant in driving economic progress. The report highlights that China will continue to enhance basic education, optimize educational resource allocation, and focus on nurturing top-tier innovators, urgently needed personnel in critical areas, and highly skilled workers.
The fast-evolving AI landscape, exemplified by DeepSeek's achievements, underscores how talent-driven innovation is propelling China's economic development. At a press conference on Tuesday, Lou Qinjian, spokesperson for the third session of the 14th National People's Congress, praised DeepSeek's success as part of China's AI ascendancy and credited the company's young talent as crucial to the country's technological progress.
China's skilled workforce has expanded to exceed 200 million, with a highly skilled talent pool of over 60 million. The nation also boasts the world's largest R and D workforce. With an expanding and evolving talent base, China's innovation-driven economy is witnessing rapid advancements. In 2024, the value-added output of new growth drivers, including new industries, business forms, and models, rose to over 18 percent of GDP. Meanwhile, the value-added output of high-tech manufacturing grew by 8.9 percent year on year, outpacing overall industrial growth by 3.1 percentage points.
Population decline and aging are challenges faced by many countries. While China's rapid industrialization has brought these challenges sooner than many others, it is proactively confronting them with targeted policies. The country has phased out its decades-long one-child policy and announced support for couples wishing to have a third child. Local governments have introduced a series of childbirth stimulus measures, including subsidies, expanded insurance coverage, extended maternity leave, and more public childcare facilities.
Simultaneously, policies aimed at enhancing elderly care services enable China to better mitigate the impacts of its aging society. The government work report commits to advancing community-supported at-home elderly care services and strengthening elderly care services in rural areas, among other initiatives.
"China is at the crossroads where population and talent dividends converge," said Du Peng, dean of the School of Population and Health at Renmin University of China. He noted that the national workforce remains abundant, and the country's talent pool is expanding, laying a foundation for China's transition to a talent-driven economy.
Many also recognize the potential of the aging population. China's silver economy is emerging as a significant growth driver, currently valued at 7 trillion yuan (approximately 976 billion U.S. dollars). According to a survey from data analysis provider iiMedia Research, the silver economy is anticipated to reach a scale of 30 trillion yuan by 2035.
"The demand of China's elderly population is upgrading and fueling new growth in the service sector, covering areas such as education, medical services, finance, and technology," said Jin Li, a national political advisor and vice president of Southern University of Science and Technology.