Taiwan's Declining Birth Rate: What Went Wrong & How to Fix It?

This article summarizes a discussion about Taiwan's declining birth rate, its potential societal impacts, and possible solutions inspired by other countries' experiences.

The Alarming Population Structure in Taiwan

The population structure chart for 2024 paints a concerning picture. The number of newborns is nearly equivalent to the number of 75-year-olds. This contrasts sharply with the population pyramids seen in North European countries, which are significantly more balanced. This trend is becoming common among Asian countries, highlighting the urgency of the situation.

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Consequences of a Declining Birth Rate

The primary concern is the shrinking young population compared to the elderly. This imbalance will strain the pension system when the current younger generation reaches retirement age, potentially leading to its collapse. The current birth rate is considered a national security crisis, and more effective governmental action is needed. A birth rate of 2.1 children per woman is generally considered necessary to maintain a stable population.

Comparing Taiwan to Other Countries

Taiwan, along with South Korea, has one of the lowest birth rates globally, around 0.8 children per woman.

• Japan: Despite having a large elderly population (approximately 30% over 65), its birth rate is higher than Taiwan's, at 1.26%.

• China: China's birth rate (1.18%) is also higher than Taiwan's, although it has decreased in recent years. Its elderly population represents 15% of the total.

• France: France boasts one of the highest birth rates in Europe, with an average of 1.84 children per woman.

• Finland: While Finland has historically performed well, its birth rate has recently declined.

Effective Policies to Encourage Fertility

Limitations of Simple Birth Rate Supplements

One-time birth bonuses are generally ineffective. Policies that provide sustained support and create a sense of security for families are more likely to succeed.

Gender Equality and Parental Leave

• Shared Responsibility: Encouraging both men and women to share baby-carrying responsibilities can promote gender equality.

• Father-Specific Leave: Countries like Norway, Sweden, and Iceland have dedicated parental leave for fathers, which is forfeited if not used.

• "Father Month" in Korea: Korea's introduction of the "father month" parental leave system has significantly increased the proportion of men applying for parental leave.

Employer Incentives

The South Korean government encourages companies to offer employee benefits related to childcare by providing tax breaks. This makes offering these benefits more attractive to employers and less of a burden.

Addressing Concerns in Taiwan

Many Taiwanese men are hesitant to take parental leave due to social stigma. While Taiwan offers up to 80% of monthly salary during parental leave, the actual benefit may be lower due to the structure of some compensation packages (e.g., a high percentage of bonus and a small percentage of base salary).

Accessible Childcare

Norway and Sweden have robust childcare systems, enabling a high rate of employment among women. Taiwan's female employment rate is significantly lower.

Addressing Social Issues

• Child Abuse: Frequent reports of child abuse and abduction discourage people from having children.

• Economic Burden: High housing prices are a major deterrent for potential parents in Taiwan and South Korea.

Housing and Tax Incentives

• Public Housing: Providing sufficient public housing can alleviate the financial burden of homeownership.

• Tax Cuts: France offers significant tax deductions for families with three or more children.

• Rental Assistance: In Korea, newborn families without their own housing can receive a two-year living allowance.

• Free Housing Policies: Some cities, like Fushan, offer free rental housing policies for families with children.

Addressing the Marriage Rate

In East Asia, pregnancy and marriage are often intertwined. Encouraging unmarried births may be a solution, as seen in Northern European countries.

Fertility Support for Women

France provides fertility support for women up to the age of 41 or 42, encouraging older women to have children when they are ready.

Reducing Overwork

Long working hours in Asian countries contribute to the population pyramid problem.

Global Comparison of Birth Rates and Contributing Factors

The world's five lowest birth rates are found in:

1. Taiwan: Rising salaries, high house prices, and labor market challenges.
2. South Korea: Income inequality, high house prices, and work pressure.
3. Singapore: High work pressure and working culture.
4. Ukraine: War.
5. Hong Kong: High housing and living costs, changing welfare systems, and political factors.

Contrasting the American Perspective

The American birth rate, while not exceptionally high, is still higher than many developed nations.

• Purchasing Power: The average purchasing power in the US is relatively high.

• Housing: Houses are generally larger, and the pressure to buy a house is lower compared to some Asian countries.

• Social Tolerance: American society is more tolerant and less demanding of children, with less emphasis on a single path to success.

• Emphasis on Self-Made Success: American culture celebrates self-made success stories, reducing pressure on parents to provide a perfect material life for their children.

In conclusion, addressing Taiwan's declining birth rate requires multifaceted solutions, including promoting gender equality, providing financial support, ensuring accessible childcare, and fostering a more supportive social environment for families.