China’s birth rate just hit its lowest point since 1949—and Trip.com cofounder James Liang thinks that’s a threat to innovation

“We need more people to innovate."

Trip.com cofounder James Liang has a blunt warning for aging economies: Without more children, their ability to innovate will soon stall. 

“We need more people to innovate. That is why population and having children is important,” he said in an interview with Fortune earlier this year. “If we have a declining population, not only will our ability to innovate diminish, but we will lose our capacity to stay in control of innovation itself.”

It’s part of a broader philosophy he’s dubbed “innovationism,” a tech-forward view of how society should be organized, and one that’s closely related to his longtime academic focus on population and demographic change. 

In Liang’s view, more people means more talent to put towards progress. “At the aggregate level, the amount of human resources put into research and development determines how much output you get in terms of patents and technological know-how,” he said. 

This puts Liang at the intersection of two debates in Asia: Whether the region’s economic dynamism can survive rapid demographic decline and what—if anything—governments can do to reverse it. 

A regional, and global, demographic decline

Liang has long been one of China’s most outspoken, demographers. He was a critic of China’s “One Child Policy” that limited families to just one child. Beijing eventually increased the limit to two children in 2015, then abolished the policy entirely in 2021.

China’s birth rate fell to 5.63 per 1,000 people last year, the lowest level since 1949. At current projections, the country’s population will fall below 1.25 billion by the middle of the century.

Demographic decline isn’t limited to China. Much of East Asia sits well below the replacement rate of 2.1 children per woman, the threshold needed to keep a population stable. Japan, South Korea, Taiwan, and Hong Kong are all moving into “super-aged” status, when more than a fifth of the population is above 65. 

Developing countries are also reporting falling birth rates. Thailand, Vietnam, Malaysia, and the Philippines have all fallen below replacement level. India, the world’s most populous country, also has a total fertility rate of roughly 1.9 births per woman. (The world population isn’t expected to peak until 2100)

“It’s becoming a global problem,” Liang said. “Last year, two-thirds of the world’s population lived in countries where fertility rates are below replacement level.” 

Can policy reverse falling birth rates?

Asian governments are trying to slow the decline with a wide array of policies, like extended parental leave, baby bonuses, and childcare subsidies. Some local governments in countries like Korea and China have even hosted dating events. 

Success, where it exists, is slight: South Korea’s fertility rate, for example, has edged upward for two consecutive years, rising from 0.72 children per woman in 2023 to 0.80 in 2025. 

Liang sees these efforts as a good start, but argues that much more is needed. He estimated that every 1% of GDP spent on pro-family policies raises the fertility rate by just 0.1. To raise it by a full child, roughly what China or South Korea would need to do to approach stability, would require spending equivalent to 10% of GDP. 

“That sounds like a lot,” Liang acknowledged. “But in China, it’s about two years of economic growth.”

Specifically, Liang supports cash transfers, which give younger people money and time to start families. He’s also a fan of measures like subsidized daycare, flexible work arrangements, legalized surrogacy and, interestingly, reducing exam pressure. 

“Highly intense systems, like college entrance exams in China or Korea, can suppress fertility,” he said, noting that the anxiety of hyper-competitive education cultures pushes young people to delay or forgo starting a family.

Trip.com Group, for its part, offers numerous childcare policies, including offering free taxis to pregnant employees, education stipends to new parents, and even subsidizing fertility treatments, like egg freezing, for its staff. 

In 2023, the company offered employees a 10,000 yuan ($1,470) annual cash bonus per newborn child, paid every year until the fifth birthday. In 2025, the company expanded its childcare leave policy to cover parents of children up to age 18. 

A complicated debate

Demographers and economists have puzzled over the lack of correlation between greater childcare support and increased fertility. 

Liang’s views on how demographics connect to innovation and technological progress also aren’t wholly accepted by the academic community.

In a paper released on June 24, after Fortune’s interview with Liang, a team of economists led by Daron Acemoglu and David Autor found that lower birth rates instead led to higher growth in GDP per working-age adult, and had no effect on total GDP. Acemoglu and Autor posit that, instead, a decline in younger populations drove companies to invest in labor-saving technologies. 

“Countries and regions with lower birth rates exhibit more labor-saving patents and growing high-tech activity,” they wrote.

Other economists, like Harvard economist Claudia Goldin, have pointed to an uneven distribution of household work as a reason for demographic change. Goldin, in a March paper, argues that when women join the workforce, men often “do little in their households to ease the increased burden on women.” Women thus choose to delay having children until the unequal distribution of household work is resolved. 

Liang, for his part, flatly rejects the idea that women should leave the workforce. “That’s not going to happen,” he said. “The solution has to be giving women more options: a lot more time and more money.” 

And he asserted that the male half of the population should be doing more. “Husbands and boyfriends should show more responsibility in child-rearing,” he said.

AI meets demographic decline

For Liang, the stakes extend well beyond fertility policy. His deeper concern is how a shrinking population will interact with another transformative force: artificial intelligence.

He accepts that AI, if it serves as a labor-saving device, could give young people “more time and financial help to raise bigger families.” (Some data on AI in the workplace suggests that the tech may be having the opposite effect, pushing people to work longer hours)

Yet he also worries that AI could squeeze young people out of entry-level jobs, making their situation even more precarious–and make them even less willing to start a family.

More fundamentally, he views AI as intensifying a debate over how to keep humans in the loop regarding AI systems. A declining population, with fewer people to manufacture things and provide necessary human judgment, may end up delegating more and more decision-making to AI. “We need more people, otherwise we’ll just yield our control to AI,”  Liang said.

“It is increasingly apparent that AI is going to be capable of replacing most human jobs,” he added. “What is left for humanity to do?” 

This story was originally featured on Fortune.com