The teething troubles of turning China’s kindergartens into homes for the aged

Aged care is a promising service area as the birth rate falls and society greys, but entrepreneurs face a series of hurdles

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In Shandong province, business couple Yu Bo and his wife are pivoting from kindergartens to services for the aged. Photo: Handout

Phoebe Zhangin Shenzhen

Published: 12:00pm, 20 Oct 2024Updated: 7:14pm, 20 Oct 2024

In his 21 years of running kindergartens, Yu Bo has never had this much trouble filling places.

Previously, he did not even need to advertise. Parents crowded his office asking if they could pay a year in advance to reserve a spot. Sometimes women even came to him while they were still pregnant.

At their business peak, he and his wife owned 11 kindergartens in Jining, in east China’s Shandong province, employed nearly 400 teachers and had more than 2,000 children on their books.

But starting in 2022, Yu noticed that the number of students had started to drop.

The business had already struggled through the coronavirus outbreak as children remained at home, but even when restrictions were relaxed in 2022, the signups were not enough to fill all the classrooms. In one kindergarten, Yu only recruited one-third of previous years’ numbers.

“I’ve done some calculations. If I have fewer than 120 children in one kindergarten, that means I lose money,” he said.

The drop in enrolments at Yu’s kindergartens mirrors a broader national demographic crisis. According to official numbers, China’s population shrank in 2022 for the first time in 60 years, with the country recording 9.56 million births and 10.41 million deaths. In 2023, the population fell for the second consecutive year by 2.08 million, with a record low birth rate of 6.39 births per 1,000 people, down from a rate of 6.77 in 2022.