Economic fears rise as Taiwan's birth rate declines

PUBLISHED : Thursday, 10 June, 2010, 12:00am
UPDATED : Thursday, 10 June, 2010, 12:00am

Patricia Hsu, a 45-year-old public relations manager in Taipei, has been referred to as 'that old spinster' behind her back by some of her colleagues who are jealous of her excellent work performance.

'I was too busy studying and working when I was young and now I am well past the age to marry. I don't think I should find a guy to marry just for marriage's sake,' she said when asked why she remained single. 'After all, I lead a comfortable life and if I can't find my 'Mr Right', I shouldn't make myself miserable by getting just anyone as my husband.'

About 300 kilometres from Taipei, Tsai Yi-chung, a 28-year-old Kaohsiung-based courier company worker, said both he and his wife, a factory worker, did not want to have children. 'Together we make only NT$45,000 [HK$10,800] a month and we can't afford to raise children,' said Tsai, the only son in his family, meaning he has a duty to take care of his aged parents.

Hsu and Tsai are among many Taiwanese who either remain single or choose not to have children for various reasons, but their choices illustrate Taiwan's drastically declining birth rate.

'If this condition does not change, Taiwan will be destroyed naturally without even needing an enemy,' said Sun Te-hsiung, former chairman of the Population Association of Taiwan.

Sun's warning echoes growing concerns about the economic and social consequences of a low birth rate in Taiwan.

With the number of newborns at just 191,310 last year, down almost 4 per cent from 2008, Taiwan's birth rate slipped to a meagre 8.29 per 1,000 people.

In just half a century, the total fertility rate - the average number of children that will be born to a woman over her lifetime - has dropped dramatically from six in 1960 to 1.02 at the end of last year.

The rate is even lower than neighbouring South Korea, which has 1.2 newborns per woman, and Japan which has 1.4, according to government statistics.

Obstetric and paediatric hospitals are seeing their livelihoods slip away. The number of obstetric clinics has declined by about 130 a year over the past five years, and the number of paediatric wards has also dropped steadily, according to the island's Children's Health Care Association.

There are fears the quality of medical treatment for children will be affected.

'The cut in the number of paediatric wards means medical treatment for children will no longer be easily available in the future,' association chairman Dr Lee Hung-chang said.

The Health Ministry approved a quota of 240 resident paediatric doctors a year, but most hospitals could take only around 80, Lee said.

Instead of studying to become obstetricians or paediatricians, many medical school students simply choose the more popular plastic surgery as their major, dealing another serious blow to children's medicine, Lee said.

The low birth rate is also hitting children's care centres, kindergartens and primary schools.

According to the Directorate General of Budget, Accounting and Statistics, 370 day-care and 186 after-school care centres, plus 98 kindergartens, had to close down in the last five years.

'We used to have around 250 to 300 students per semester but now we are left with fewer than 100,' said Yang Yi-yu, whose kindergarten in Taoyuan county is struggling to avoid going out of business, like many of its former competitors.

The decline in the birth rate has also resulted in a reduction in the average number of primary school pupils per teacher from 18.3 in 2004 to 16.1 last year. This is expected to force elementary and junior high schools to cut the number of classrooms in use by at least 1,000 in the next three years.

'Having fewer students means the suspension of classes and the lay-off of teachers,' said Liao Chun-jen, former vice-chairman of the National Teachers' Association.

As there will be 100,000 fewer students by 2021, according to the Education Ministry's estimate, 'many universities and colleges are bound to face financial problems because of the low birth rate impact', Education Minister Wu Ching-chi said. About 60 of Taiwan's 164 universities and colleges may be forced to shut down.

Once the domino effect kicks in, shops and other businesses relying on pupils will suffer - then housing and domestic consumption - as supply will far exceed demand, population experts warn. Taiwan's competitiveness in the global market would decline and this could affect the very survival of the island, they said.

Interior Vice-Minister Chien Tai-lang estimated that Taiwan's population, currently 23 million, could start falling after 2017. Economists say lost manpower or brainpower will hamper the island's ability to keep up with its industrialised Asian neighbours in 10 to 15 years.

'A sharp drop in the labour force could result in a massive decline in productivity, which would affect the economic and industrial development of Taiwan,' economist Wu Hui-lin said.

Another issue is that the lack of children raises the average age of the island's population. If nothing changes, each working person in Taiwan will have to support 1.5 retired elderly people by 2056 and half of the people would be well over 57 years old, said Professor Chen Kuan-jeng of the health care management department at Chang Gung University.

'This means the government would not only receive less revenue from individual income tax, but it would also have to spend more for the welfare of the elderly,' he said.

However, Chen does see a solution. 'Taiwanese women will have to bear at least 100,000 more babies each year for five consecutive years in order to meet the Organisation for Economic Co-operation and Development standard of 1.6 children [per woman] by 2015.'

Using the nearly 200,000 births last year as the standard, that would mean 1.5 million babies in that five-year period.

But sociologists say women today are less willing to have babies, as society changes.

'Unlike women who were mostly housewives in the past, many women today share the responsibility of earning the family income with their husbands, which results in their reluctance to have more children,' said Dr Lin Thung-hong, assistant research fellow at Academia Sinica's Institute of Sociology.

Social worker Wang Tai-yu said: 'They are the so-called doubleincome, no-kid group, who prefer to have their own free lives rather than being tied down by children.'

Or people are simply not marrying. Interior Ministry statistics show that 181,632 couples married in 2000 but only 117,099 last year.

To try to address the problem, the Taiwanese government plans to offer a number of incentives.

'We are planning to offer a monthly subsidy of NT$5,000 for all children under the age of three, which would cost the government NT$36 billion a year, in a bid to raise the public's willingness to have babies,' Interior Minister Chiang Yi-hua said.

Other measures include establishing a comprehensive child educational and care service system and a child support system to lower family financial burdens, Chiang said.

In March, the ministry began a contest to find a slogan that can best entice people to have babies, with a NT$1 million prize for the winner. The response was overwhelming.

On May 7, the Taipei city government announced a NT$3 billion plan to pay couples to have babies from next year, offering NT$20,000 for every newborn and a monthly subsidy of NT$2,500 for every child aged below five. They will also exempt NT$12,543 in education expenses for each five-year-old child enrolling in city-sponsored kindergartens.

'We hope the measures can encourage more young couples to have children,' Mayor Hau Lung-bin said.

Population experts said while this was a good start, it was important for the government to step up efforts to swiftly boost the birth rate before it was too late.