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    How Much Does it Cost to Raise a Child in China?

    Hint: It's not just about the money.
    Mar 06, 2020#family

    This January, China announced its birth rate had fallen to its lowest point in 70 years. While experts fretted about the political and economic ramifications of China’s impending population crunch, netizens took the opportunity to once again vent about the astronomical cost of parenthood. It’s not just school fees, extracurricular cram classes, and pressures to buy a house in a top school district that make adults question whether raising children is beyond their means; there’s also the fact that raising children — and supervising their studies — can be utterly exhausting. There’s a reason sayings like “When the kid isn’t studying, all is well; when they break out the books, it all goes to hell” have become memes.

    Childrearing is not just a family matter. Children represent China’s next generation of workers, innovators, and taxpayers. But if the costs are too high, couples who can’t foot the bill will naturally choose to have fewer children — or even forgo them altogether — and birth rates will continue to drop. As a society, we need to recognize that children are crucial to our future economic and social development and that the cost of child care must therefore be shared equally.

    But what exactly is the cost? According to a recently released report, the average family living in Shanghai’s central Jing’an District spends more than 800,000 yuan ($115,000) per child from birth to junior high school. Low-income families, defined as those with an annual household income of less than 50,000 yuan, spend an average of 70% of what they earn on their children.

    As one of China’s richest cities, Shanghai is not necessarily representative of the country as a whole. But widening our lens doesn’t change the overall picture. According to the 2014-2015 China Family Development Tracking Survey, carried out by the then-National Health and Family Planning Commission, parents spend slightly more than 10,000 yuan a year on costs directly related to their children between birth and age 5. This average drops to less than 8,000 yuan when considering only rural areas, and rises to over 15,000 yuan in cities.

    On the basis of this statistic, I made a conservative estimate: Before adjusting for inflation, the average Chinese child costs a total of 191,000 yuan from their birth to age 17. The average kid in the city requires 273,200 yuan; while for a child growing up in the countryside, the costs are somewhat lower, at 143,400 yuan.

    That doesn’t mean rural parents are better off. During the period covered by the above survey, the average per capita annual disposable income for urban residents in China was 26,955 yuan — more than three times higher than the per capita income of rural residents. In short, the higher their income, the more parents spend on their children. But the amount that low-income households spend on their children accounts for a higher proportion of their earnings, implying a heavier burden.

    What’s more, this estimate only covers the money parents spend on their children. What about more indirect or abstract costs, such as time?

    For families, these costs include time spent caring for children without compensation, as well as other trade-offs of being a parent, such as the decrease in income that results from interrupting one’s career and the depreciation of one’s perceived worth as an employee upon returning to the workplace.

    Unsurprisingly, women are hit particularly hard. The latest edition of the Survey on the Social Status of Women in China shows that, as the number of children increases, both parents’ domestic workload rises by roughly the same amount. But the 2010 dataset shows that, in families with two or more children, the woman’s housework increases by a greater margin than the man’s. And gendered care norms remain prevalent. According to data from 2018, the average Chinese — an admittedly expansive dataset that includes unmarried and childless individuals — spends 36 minutes a day caring for children. For men, the average is 17 minutes; for women, it’s 53 minutes.

    The different effects of childbirth on the two sexes are evident in their relative post-childbirth incomes. The abovementioned survey on the social status of women found that every additional child under the age of 18 lowered the incomes of both men and women, but that mothers suffered a greater pay penalty, at 12% — almost twice as large as ones for men. The effect can be particularly pronounced for educated urbanites. While highly educated women in urban areas typically face the smallest gender pay gap, they suffer the largest motherhood penalty.

    If we look at China’s current family policies, we can see that society’s share of these costs is inadequate. There are no universal child benefits in China, and the tax system is individual rather than family-based and largely does not take into account the costs of raising a child.

    As for time, Chinese law guarantees only 14 weeks of maternity leave, and fathers get even less than that — a little over two weeks on average. Meanwhile, public child care facilities for children under 2 are still a relatively foreign concept. Even women who have not yet given birth often face flagrant discrimination, since employers worry they may one day take maternity leave.

    Many Chinese are pushing for greater gender equality in the workplace — including equal pay for equal work — but they often ignore the costs of motherhood. Since the beginning of China’s market-oriented reforms, the income gap between men and women has continued to increase, and childrearing is one of the main culprits.

    To address this problem, we first need a better idea of what exactly the costs are. The above data offers a rough outline, but China must carry out nationwide surveys on household consumption and parenting costs, with a focus on policymaking and regional and class differences. Second, leave policies should be modernized to account for parents’ needs. That means extending parental leave and ensuring that parents have the ability to take it without facing discrimination from their employers. Finally, the country’s tax system should be adjusted to redistribute wealth and alleviate the burden on families.

    Given the high costs and low levels of public support for childrearing, especially in the first few years before kids start school, it shouldn’t come as a surprise that China is experiencing a decline in total birth rates. Today’s parents are charged with raising and caring for our nation’s future. It’s time the nation took a more active role in supporting and caring for them.

    Translator: Lewis Wright; editors: Lu Hua, Kilian O’Donnell, and Cai Yineng.

    (Header image: A mother gives her son a ride to the high school entrance examination in Jinan, Shandong province, June 12, 2019. Wang Jian/VCG)