You are looking at it from the perspective of a Developed Country. Developed countries use modern technologies, like automation to increase productivity. It does not need massive increases in labor force to increase productivity.
Although China have done a great job of lifting 800M people out of poverty, there are still many poor and unemployed people living in rural communities. It is still a developing country. Every month, millions of rural people move to the city, to try to find jobs.
Another point: the one-child policy only applies to the dominant Chinese Han people. It does not apply to minorities who live in mostly rural communities. Hence the source of supply for its current Labor force.
Notwithstanding the above, inevitably, the Chinese economy will become a Develop economy and their manufacturing base will move offshore to places like India, Laos, North Korea, and Cambodia. In fact, it is already starting to happen - you see it at the Chinese borders.
The Chinese economy, like many before it (Germany, Japan and South Korea) will experience growing pain.
If you go back to when they opened up their economy to market forces (1978), you will see they have had quite a few stumbles along the way.
Will they have stumbles in the future - of course.
Will it destroy them? No, as long as they have smart leaders (and they do).
Similarly, the GFC did not destroy Western Economies.