China is in Stage 5 of the demographic transition model (DTM), the most advanced stage, where deaths outnumber births and the total population shrinks. In 2023, China recorded 9.02 million births against 11.10 million deaths, giving it a negative natural growth rate for the second consecutive year.
Why China Qualifies as Stage 5
The DTM tracks how countries move from high birth and death rates (Stage 1) through various phases of decline until both rates stabilize at low levels (Stage 4). Stage 5 is sometimes treated as a theoretical extension of the model, describing countries where the birth rate drops below the death rate and population begins to decline without immigration. China now fits this pattern clearly.
In 2023, China’s crude birth rate was just 6.39 per thousand, while its crude death rate was 7.87 per thousand. That gap means roughly 2 million more people died than were born. The total fertility rate, the average number of children per woman, has fallen far below the replacement level of 2.1. By 2000 it was already around 1.6, and it has continued dropping since. Demographers now describe China as a “post-transitional” society where life expectancy has reached new heights, fertility sits well below replacement, and rapid population aging is underway.
How China Got Here So Fast
China’s path through the DTM was unusually compressed. Most European countries took 150 to 200 years to complete their demographic transitions. China did it in roughly 50.
In the 1950s, China was firmly in Stage 2. Death rates had begun falling thanks to improved public health, but birth rates remained high, fueling rapid population growth. The total fertility rate in 1970 was still 5.7 children per woman. Through the 1970s, government campaigns promoting smaller families brought the fertility rate down to 2.8 by 1979, before the famous one-child policy even took full effect. By international standards, China had largely completed its fertility transition by the time economic reforms began at the end of the 1970s.
The one-child policy, introduced in 1980, accelerated what was already happening. Birth rates continued their steep decline through the 1980s and 1990s. By 2000, the birth rate had fallen to 14 per thousand, the death rate sat at 6.45 per thousand, and natural increase had slowed to 7.58 per thousand. China spent only a relatively brief period in Stage 4 before crossing into Stage 5 territory in the early 2020s.
Urbanization as a Driving Force
Government policy alone doesn’t explain the shift. Urbanization has been a powerful underlying force. China’s share of population living in urban areas reached 67% in 2024, growing at over one percentage point per year for the past 45 years. Urban life consistently drives fertility down everywhere in the world: housing is expensive, childcare is harder to arrange, and children shift from economic assets (helping on farms) to economic costs (requiring education and support for decades).
Rising education levels, particularly among women, and increasing workforce participation compound these effects. When people have more options and higher costs of living, they tend to have fewer children, and they have them later. China experienced all of these shifts simultaneously and at enormous scale.
What Stage 5 Looks Like in Practice
The most visible consequence of Stage 5 is an aging population. In 2020, 172 million Chinese people (12% of the population) were 65 or older. That number is projected to more than double to 366 million (26%) by 2050. For context, in 1970 only 3.7% of the population was over 65 and more than half was under 20. By 2020, the under-20 share had dropped to 23.4%.
China’s old-age dependency ratio, which measures how many elderly people there are relative to working-age adults, was 0.19 in 2020. That’s nearly double India’s ratio and rising quickly. A higher dependency ratio means fewer workers supporting more retirees, which strains pension systems, healthcare, and economic growth.
The Chinese government has already reversed course on birth restrictions, moving from the one-child policy to a two-child policy in 2016 and then a three-child policy in 2021. So far, these changes have not reversed the downward trend in births. This pattern matches what other Stage 5 countries like Japan and South Korea have experienced: once fertility drops below replacement and cultural norms shift toward smaller families, policy incentives struggle to push the birth rate back up.
How China Compares to Other Stage 5 Countries
China is not alone in Stage 5. Japan, South Korea, Italy, and Germany have all experienced periods where deaths exceeded births. Japan has been in population decline since 2008. South Korea’s fertility rate is even lower than China’s.
What makes China’s situation distinct is scale. A population decline in a country of 1.4 billion people has global economic implications that a decline in a smaller nation does not. China also arrived at Stage 5 at a lower per-capita income than most Western countries did, leading to the common observation that China “got old before it got rich.” Wealthier nations that aged gradually had more time to build robust pension and healthcare systems. China faces the challenge of doing so under tighter fiscal constraints and a faster timeline.