Cover Story: China’s Balancing Act to Keep Its Social Security System Afloat

The Chinese government is caught in a dilemma: there is a pressing need to boost contributions to what is the world’s largest social security system to better support the country’s aging population, while simultaneously address growing calls to reduce the financial burden amid a wobbly economy and the slowest wages growth in up to 40 years.

Contributions made by Chinese residents and companies to government insurance plans have continued to rise in recent years, correlating with the steady increase in average wages. Every summer, a hike in the baselines for social security contributions has become the norm after the central government’s statistics department unveils the latest wage data.