Demographic Demise? Taiwan's Aging and Shrinking Population

Demographic Demise?Taiwan's Aging and Shrinking Population Michael Mazza (bio) Asia's most vibrant democracy is rapidly aging. The youthful energy that powered a democracy movement in the 1980s and 1990s and asserted Taiwanese identity in the 2010s is dissipating. Taiwan has always been a small country—but it is soon to be a shrinking one, with its population projected to peak in 2030. The implications for Taiwan's future vitality, and indeed for its survival, are profound. This essay first elucidates ongoing demographic shifts in Taiwan, emphasizing changes in population size (it is shrinking) and population structure (it is aging). It then explores how those shifts are bringing about societal changes and imposing economic and national security challenges for which there are no easy answers. The essay concludes with a discussion of the ways in which Taiwan might address these impending adversities that highlights the opportunities for international collaboration and domestic cooperation, which, counterintuitively, demographic disadvantages may create. Taiwan's Demographic Shifts Demographic changes have come quickly. The median age in 2000 was 30.7, whereas in 2020 it was 40.8. It is projected to reach 46.2 in 2030. Between 2000 and 2020, the population growth rate dropped from an already meager 0.61% to an even more paltry 0.17%.1 In 2000 the working-age population—those ranging in age from 15 to 64 years old—accounted for 70.3% of Taiwan's total population. In 2020 this age bracket grew to 72.0% of the population, but that growth was entirely among people aged 50 and older. Those aged 65 and over made up just 8.4% of the population in 2000, but by 2020 that share had nearly doubled to 16.0%.2 The dependency ratio—which measures the ratio of the population aged 14 and below and 65 and over to the working-age population as a End Page 119 percentage—actually shrank over the past two decades, but that is because the under-15 population share contracted. Going forward, however, the dependency ratio is projected to rocket upward, rising from 38.9% in 2020 to 53.0% in 2030. It is projected to exceed 100% in the 2060s, meaning there will be more than two dependents—mostly expensive-to-care-for over-65s—for every working-age individual in Taiwan.3 These shifts in population structure are due to increasing life expectancy, which has steadily climbed since 1950 (when UN records begin), and especially due to a cratering fertility rate, which has been below the replacement level for more than four decades. In short, Taiwanese are living longer and having fewer babies.4 This, along with other factors, including decreasing marriage rates, has led to changes in family structure and household living arrangements. Large nuclear families are now a thing of the distant past, and no-child and single-child families are the norm. Citing household registration records, Chen Yu-Hua notes that "the average household size has fallen from 6.09 persons per household in 1946 to 2.67 in 2020," a result of both increasing homeownership and decreasing fertility rates. Given the latter, Chen writes, "only a small share of households includes children." In addition, "the number of multigenerational and extended households has decreased significantly. More than 80 percent of Taiwanese are living in a one- or two-generational households sic."5 Societal and Workforce Changes and Challenges Many traditional notions of family responsibilities endure. Married couples often live close to at least one spouse's parents, and it remains common for people to financially support retired elders. But attitudes regarding these responsibilities and customs are changing. Without siblings, two generations of single children bear greater burdens in supporting parents and grandparents, given lengthening life expectancies, than did previous generations. And bearing those burdens is becoming more difficult. As Roy Ngerng points out, housing prices across Taiwan are among the world's highest, even as household income remains "one of End Page 120 the lowest among the advanced countries."6 Importantly, with the fertility rate having dropped below 1.0, future retirees will not have children or grandchildren—or even nieces and nephews—on which they can depend...