It's important to remember that to just maintain a population you need an average of 2.1 births
Assuming no net migration and unchanged mortality, a total fertility rate of 2.1 children per woman ensures a broadly stable population.
There's a couple of major things feeding this
The legacy of the "one child" policy
China, for decades, had a strict one child per family rule. And by strict, I mean heavy fines, beatings, kidnappings and sometimes forced abortions
In a city setting they could maybe, if you worked for a [civil service-like] job they might threaten to fire you. ... This is for having a child. If you went for a termination, all of this would go away. But, of course, then there were people who really wanted the child and then they would try and evade the whole process of being taken away for a forced abortion, because here's the thing: Between your conception and your delivery date, all bets are off — they can make you.
This, of course, had the effect of promoting abortions in general. This lead to a much more serious problem that is now manifesting itself. In Chinese society (as with many Asian cultures) having a son was preferred and if you only get one... sex-selective abortions became commonplace. This has lead to a major population imbalance (emphasis mine)
But later in the 1990s, technology made it easier for people to do all these scans and companies like General Electric made these scanning machines that were portable and small enough that you could go from village to village and you could determine the sex of your fetus ... for as little as $10 or $20, so people would just have an abortion instead of carrying a child to full term. ... The Nobel economist Amartya Sen estimated there were about 100 million missing women, women that were never born or killed or aborted across Asia.
The estimates of that imbalance are sobering
According to China Statistics Press 2013, China's sex ratio at birth was 111 in 1990, 117 in 2001, 121 in 2005 and 119 in 2010.
The Chinese are now more like their Western counterparts
For decades, Western countries have been in population decline.
There are good reasons governments have struggled to find a solution. Firstly, the decline is down to positive social developments, starting from improved infant mortality and the end of child labor. People no longer need an army of children to ensure some survive to work the land. More recently, opportunities for migration, universal access to contraception, the increase of women in higher education and greater female participation in the labor force have led many to delay starting their families.
China is a victim of their own success in that regard. The Chinese often cite the high cost of living as a reason they are not having children now
“Honestly, I don’t want to have a relationship, I don’t want to get married, and I don’t want to have children,” said Zhang Jie, a 31-year-old salesman with a small private trading company in Guangzhou who recently broke up with his girlfriend after four years. “For the working class, it is simply becoming more and more unaffordable to raise a child in urban cities.”
This bodes poorly for China
This isn't something you can fix by just telling people that it's now OK to have two (or three) children. With their changes in demographics now backed in, this will take decades to reverse (assuming it can be reversed at all). In an act of civil disobedience, a man defied COVID lockdowns and became a social media star
Last year, a video went viral in China showing a young man who refused to be taken into a quarantine camp being warned by police that his punishment would affect his family for three generations. He coolly retorted: “We are the last generation, thank you.”
And China will face labor shortages in the future as a result
Chien-Chung Wu, an associate professor at Taipei University of Maritime Technology, said the population decline would eventually have a huge impact on China’s economy. He believes the shrinking of the labour force and consumer market would make China lose its edge and prompt foreign businesses to turn to other Asian countries.