China's new second-child policy took effect at the beginning of this year. It's expected to result in a baby boom and that is stimulating the market for post-natal services.

Second-child policy fuels post-natal market

Chen Yibing gave birth to her second child two weeks ago. It's a Chinese tradition for a new mother to take it easy for at least a month, as Chinese believe the post-natal period is critical to a woman's health. It's normal for grandparents to help in China, but Chen decided to hire a nanny.

"I need to wake up a couple of times in the night to feed the baby, so I don't want to exhaust the old people and make them ill. Also, I think a professional nanny should know more about taking care of the baby," she said.

This postnatal nanny looks after both the baby and Chen. She charges about 12,000 yuan, nearly $2000, a month. That's a white-collar worker's salary in Beijing. Chen says she's happy with the services, but thinks it's a bit expensive.

"I thought about hiring her for two months, but it's expensive, so I can only afford one month. Almost all the post-natal services cost this much. You have no choice," Chen said.

Many people have waited to have their baby this year because it's believed to be luckier to be born in the Year of the Monkey than the Year of the Sheep.

China's newly-implemented second-child policy has added more fuel to the market for post-natal services.

"This year is crazy. There's been a sudden surge in demand. Reservations are up 50 percent with 350 so far this year. We signed about 70 contracts last week," said Cui Jingwen, chairman of Liming Baby Care & Education Center.

The nannies charge between 6,000 and 20,000 yuan a month. That's about 1,000 to 3,000 US dollars. This care center plans to raise its fees by 15% next month.

"I've checked with our potential clients. They are OK with the price rise. I plan to double the number of the nannies to about 1500 this year to meet the demand, but it's not easy to find good ones," said Cui Jingwen.

The Chinese Academy of Social Sciences says about 17-million babies are born in China each year. The new second-child policy may add another three-million each year in the next five years. On average each child will cost 60,000 yuan, or about 10,000 US dollars, in its first five years. So this newly-added population should create about 2 trillion yuan consumption from 2016 to the end of 2020.

"All sectors related to infants and children will see a marked increase in consumption, including children's clothes, toys, education and post-natal care. Although some female-dominated sectors may face a labor shortage because of maternity leave, in general this policy will help China's economy," said professor Gao Wenshu, Chinese Academy of Social Science.

Chen says hiring a post-natal nanny is just the first step for the baby. She expects to spend much more on education and a bigger apartment.

For many Chinese families like Chen's, a second child will put an extra burden on the household budget. But this spending should spur the market for post-natal services and the Chinese economy as a whole.