Silver Transition's Impact on Shandong's Consumption Structure

Chong Zhang

New Channel UIBE Qingdao, Qingdao, Shandong Province, 266000, China

Keywords: Population Aging, Consumer Structure, Pearson's Correlation Coefficient Method.

Abstract: The gradual intensification of population aging in China is manifested in substantial structural shifts in

consumption expenditure patterns. Taking Shandong Province as an example, this paper examines the

characteristics of population aging in the province, using data on the elderly population from 2010-2023. The

impact of aging on the composition of consumption expenditures is quantitatively studied through the Pearson

correlation coefficient method. It is found that population aging has a statistically significant association with

the composition of consumption expenditure. In terms of the composition of consumption expenditure, aging

is positively associated with the proportion of expenditure on education, culture, recreation, and health care.

This suggests that aging contributes to total consumption expenditure by increasing expenditure on education,

recreation, and health care. In addition, the correlation coefficient between aging and the proportion of food,

tobacco and alcohol expenditure and housing expenditure is negative, indicating that aging increases will

reduce the proportion of food, tobacco and alcohol consumption and housing consumption. Policy

recommendations include improving social protection, developing industries focused on older persons,

adjusting fertility policies to address the impact of ageing on consumption, and promoting sustainable growth

through targeted economic adjustments.

1 INTRODUCTION

China's accelerated aging since 2000, marked by fast-

growing elderly populations, coincides with

economic restructuring. Examining aging's

consumption impacts is crucial for sustainable

development and industrial optimization through

elderly-focused service expansion.

The composition of consumer spending is an

important indicator reflecting the level of economic

development and the quality of life of the population.

As the proportion of the elderly population increases,

the structure of household consumption expenditure

is bound to change. On the one hand, the content of

consumption of the older population is different from

that of the younger population, with higher

expenditures on health care and daily care. On the

other hand, population ageing may affect household

income levels and consumption expectations,

indirectly affecting the composition of consumption

expenditure.

Although the phenomenon of an expanding aging

population is prevalent in most regions, there are

https://orcid.org/0009-0002-5932-2314

significant regional differences in its socio-economic

impacts due to different regional development

trajectories. Taking Shandong Province as a typical

case, this study outlines the characteristics of

population aging in the province through longitudinal

econometric analysis and explores the impact of

aging on the composition of residents' consumption

expenditures. The results of the study are important

for the innovation of old-age security mechanism and

the catalysing of sustainable economic

transformation through the strategy of silver-hair

economy optimization.

2 LITERATURE REVIEW

About the impact of the increase in the proportion of

elderly people on the structure of consumption, the

results of some scholars' studies have found that

population ageing can enhance the structure of

consumption.

Ma empirically evaluated the research hypotheses

using provincial balanced panel data from 2003-2021

Zhang, C.

Silver Transition’s Impact on Shandong’s Consumption Structure.

DOI: 10.5220/0013825700004708

Paper published under CC license (CC BY-NC-ND 4.0)

In Proceedings of the 2nd Inter national Conference on Innovations in Applied Mathematics, Physics, and Astronomy (IAMPA 2025), pages 355-359

ISBN: 978-989-758-774-0

355

and obtained the following conclusions: population

aging suppresses subsistence consumption, promotes

enjoyment consumption, and has a non-significant

effect on developmental consumption (Ma, 2024).

Through the regression analysis of China's population

aging and the composition of consumption

expenditure, Ma et al. found that the deepening of

population aging not only does not inhibit the

upgrading of China's consumption expenditure

composition, but also promotes its upgrading (Ma et

al., 2023). Xie empirically analysed the data of thirty

provinces in China from 2009 to 2020 by using a

double fixed-effects model and a panel quantile

model and found that the old-age dependency ratio

will improve residents' consumption structure (Xie,

2023). Liu and Rao empirically examined the impact

of population aging on the level and structure of

household consumption using the Tobit model. The

results found that demographic changes have a

significant impact on rural household consumption

(Liu and Rao, 2021). Gu empirically analysed the

relationship between changes in household

population structure and consumption structure

transformation. Population aging achieves

consumption upgrading by reducing the demand for

food and clothing, increasing the demand for

entertainment and healthcare services. At the same

time, the increase in healthcare consumption has

squeezed out some transportation, communication,

and education expenditures (Gu, 2024).

Zhan and Yang examined the consumption

patterns among the elderly population. Based on data

from the 2012-2020 China Household Tracking

Survey, using a stratified cross-classification random

effects model, the study finds that the age of the

elderly population has an inverted U-shaped

relationship with the upgrading of the consumption

structure. As age increases, the proportion of

development and enjoyment expenditures of the

elderly population first increases and then decreases

(Zhan and Yang, 2024). Cao empirically examined

the impact of population aging on residents'

consumption structure using fixed-effects and

moderating-effects models. The study results showed

that at the national level, population aging

significantly inhibits the survival-type consumption

of China's residents. It has a significant promotional

effect on the development-type and enjoyment-type

consumption (Cao, 2023). Wang selected Nantong

City, Jiangsu Province, which has the most severe

population ageing in China, as a case study. Utilising

relevant data from 2012 to 2020, the author employed

regression analysis to ascertain that population ageing

exerts a significant positive influence on the average

living consumption expenditure of all residents, the

average consumption propensity of the residents, and

the structure of consumption (Wang, 2023). Xu et al.

found that population aging significantly promotes

the advanced and rationalized industrial structure (Xu

et al., 2023).

Some scholars also argued that population aging

does not have a significant impact on the composition

of consumer spending. Using China's interprovincial

panel data for 1989-2004, Li et al. examined the age

structure of China's population and finds that China's

old-age dependency coefficient does not have a

significant effect on the consumption rate of its

resident (Li et al., 2008). Through Chinese provincial

panel data, Miao examined the impacts and pathways

of population ageing on the consumption structure.

The findings indicate that population ageing exerts

negligible influence on the consumption structure in

the eastern region. However, the adverse impacts on

the enhancement of the composition of consumption

expenditure in the central, western, and northeastern

regions are particularly salient (Miao, 2024).

Scholars have examined the interaction between

population and consumption from multiple

dimensions, but China exhibits clear regional

differences in its aging-economy model. Coastal,

central, and western regions perform differently in

addressing demographic challenges, which is closely

related to the different economic development of each

region.

3 METHODOLOGY

3.1 Data Source

This paper primarily utilizes population records from

2010-2023 and household expenditure data from

2013-2023 from the Shandong Statistical Yearbook

2024.

3.2 Method Introduction

This paper applies the Pearson correlation coefficient

method to study the impact of the increase in the

proportion of the elderly population on the

composition of consumer expenditures in Shandong

Province.

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356

4 RESULTS AND DISCUSSION

4.1 Ageing in Shandong

In 2023, the total population of Shandong Province

has reached 101.23 million people, accounting for

7.18% of the national population, ranking second in

the country. It is one of the two provinces with over

one hundred million population. In 2023, the

population aged sixty-five and above in Shandong

Province was 17.61 million, accounting for 9.24% of

the national population aged sixty-five and above.

Compared with other provinces, Shandong's

considerable proportion of elderly people will result

in labour shortages and increased government

pension costs, which will continue to widen the

economic gap between regions.

This analytical perspective reveals that the

intensifying gerontic transition constitutes not merely

a demographic phenomenon, but rather a multifaceted

interdisciplinary challenge spanning economic,

social, and institutional dimensions.

Table 1: Percentage of elderly (65+) in China and

Shandong, 2010-2023.

Year

National（%）

Shandong (%)

2010 8.9 9.9

2011 9.1 10.0

2012 9.4 10.4

2013 9.7 11.0

2014 10.1 11.6

2015 10.5 12.2

2016 10.8 13.2

2017 11.4 14.0

2018 11.9 15.0

2019 12.6 15.8

2020 13.5 15.1

2021 14.2 15.9

2022 14.9 16.7

2023 15.4 17.4

Table 1 reveals Shandong's accelerated demographic

aging trajectory, with the population cohort ≥65

years surging from 9.9% (2010) to 17.4% (2023) -

exceeding the national average by 1-3 percentage

points annually. The aging situation in Shandong

Province is more serious than that of the whole

country.

4.2 Accelerated Ageing Process

Table 2 delineates a pronounced upward trajectory in

Shandong's geriatric demographic metrics. From

2010 to 2023, the number of older adults aged sixty-

five and above in Shandong will increase by about

8.13 million, with an average annual increase of

580000.

Table 2: Population aged 65+ and proportional trends in

Shandong Province, 2010–2023.

Year Population

(

10⁴

ersons

)

Proportion

(

)

2010 948 9.9

2011 967 10.0

2012 1010 10.4

2013 1072 11.0

2014 1138 11.6

2015 1204 12.2

2016 1316 13.2

2017 1405 14.0

2018 1512 15.0

2019 1597 15.8

2020 1535 15.1

2021 1617 15.9

2022 1697 16.7

2023 1761 17.4

According to the classification criteria for an aging

population, a country or region is classified as an

aging society when the proportion of people aged 65

and above exceeds 7%, a deeply aging society when

it ranges from 14% to 20%, and a super-aging society

when it exceeds 20%. In 2017, the number of older

adults aged sixty-five and above in Shandong

Province reached 13.24 million, accounting for

14.0% of the total population, reaching the standard

of a deeply aging society.

Table 3: Age-specific population distribution in Shandong

Province, 2010–2023 (%).

Year 0-14 years

(%)

15-64 years

(%)

65+ years

(%)

2010 15.7 74.4 9.9

2011 15.7 74.3 10.0

2012 16.1 73.5 10.4

2013 16.1 72.9 11.0

2014 16.4 72.0 11.6

2015 16.6 71.2 12.2

2016 16.4 70.4 13.2

2017 17.2 68.8 14.0

2018 18.1 66.9 15.0

2019 18.0 66.2 15.8

2020 18.8 66.1 15.1

2021 18.4 65.7 15.9

2022 17.9 65.4 16.7

2023 17.3 65.3 17.4

Silver Transition’s Impact on Shandong’s Consumption Structure

357

In table 3, the main working-age population (15-64

years old) shows a gradual shrinking trend (2010-

2023), from 74.4% to 65.3%. The decline in the share

of the working age population will have a negative

impact on the overall economic development. During

the liberalization of fertility policy in 2016-2017,

there was a brief increase in the adolescent population

(0-14 years old), but after 2020 the share of the

adolescent population (0-14 years old) declined year

by year.

4.3 Impact on Consumption Structure

Household expenditure allocation patterns,

fundamentally reflecting the proportional distribution

of consumption categories within total domestic

outlays, serve as a socioeconomic mirror capturing

regional developmental gradients and cultural

particularities (Table 4). This paper analyses the data

on food (X1), housing (X2), culture, education, and

entertainment (X3), healthcare (X4), total

expenditure (X), and elderly population ratio (Y).

Table 4: Per Capita consumption expenditure in Shandong

Province, 2013-2023.

Year X

(yuan)

2013 11775 3442 2660 1136 902

2014 13329 3932 2826 1303 990

2015 14578 4166 2903 1755 1180

2016 15927 4490 3215 1948 1339

2017 17281 4715 3566 2174 1484

2018 18780 5031 3929 2410 1628

2019 20427 5417 4370 2419 1816

2020 20940 5757 4437 2374 1914

2021 22821 6196 4683 2729 2016

2022 22640 6267 4812 2566 2015

2023 24293 6791 4726 2915 2247

4.4 Pearson Correlation Coefficient

Method

The statistical measure of linear association assumes

values bounded within the closed interval [−1,1],

where the metric's magnitude corresponds directly to

the effect size of the bivariate relationship, with

perfect unity indicating deterministic

interdependence.

Table 5 shows that the correlation coefficient

between aging and consumer expenditure is 0.99,

indicating a highly positive correlation. The increase

in the aging population can drive consumption

expenditures in Shandong Province.

Table 5: Pearson correlation coefficient results

X X1,

X2,

X3,

X4,

X 1

X1, % -0.69 1

X2, % -0.39 0.16 1

X3, % 0.48 -0.75 -0.66 1

X4, % 0.93 -0.79 -0.40 0.64 1

Y 0.99 -0.74 -0.37 0.53 0.93 1

From the perspective of consumption structure, aging

is positively correlated with the proportion of

education, entertainment, and healthcare

expenditures. The driving effect of aging on total

consumption expenditure is achieved through

increasing education, entertainment, and healthcare

expenditures. In addition, the correlation coefficient

between aging and spending on food, tobacco,

alcohol, and housing is negative, indicating that an

increase in aging will reduce the proportion of food,

tobacco, alcohol, and housing consumption.

5 CONCLUSION

First, governments should combat aging challenges

through pension system upgrades and healthcare

subsidies for chronic treatments. Developing

accredited care facilities with mobile health platforms

and caregiver training can effectively enhance elderly

support systems while reducing family burdens. This

will increase the demand and confidence of older

people to consume.

Secondly, older people will demand more health

and wellness products, and related industries will

have development opportunities. Older people have

higher purchasing power, and their demand for

tourism, culture, leisure, and other fields will also

increase. Therefore, the authorities concerned can

actively promote the development of the relevant

industries, which will not only meet the needs of the

elderly but also create more employment

opportunities and promote economic growth.

Finally, there is a need to adjust the demographic

structure. In response to the low birth rate in

Shandong Province, the author is encouraging

childbearing by improving the maternity leave system

and the insurance system, strengthening financial

support, and so on, enhancing the level of eugenics

services in terms of lowering the cost of education,

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358

perfecting the system of maternal and child health

services, improving women's status and rights, and

alleviating the burdens of the family to increase the

willingness of families to bear children.

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