Falling Japanese population puts focus on low birth rate

Unless re-energised, demographics will erode Japan’s superpower status

Five generations of Tokyo children have filed through Shinsen Elementary School but its classrooms have now fallen silent, a symbol of Japan’s lopsided population pyramid.

Next year, the school buildings will be demolished and replaced by a care home. Suginami ward has few other places to put its infirm elderly, says Yasunori Kaizu, a city spokesman.

Such closures are increasingly common: Japan loses over 400 primary and secondary schools a year as depopulation kicks in, according to government figures.

Japan is one of the planet’s oldest societies, with a median age of 46.5 years. Only Monaco, with its large influx of elderly retirees, is more senior.


The greying, declining population is perhaps the government’s toughest challenge. By 2060, Japan is projected to lose about 40 million people. Almost 40 per cent of the remaining 87 million will be 65 or older.

That alarming forecast is hardly a surprise. The working population has fallen by 10 million over the last two decades. Another 30 million or more may disappear by 2060 as the overall population collapses, says Kosuke Motani, a senior economist at the Japan Research Institute, a think tank.

The latest government strategies for averting this slide, therefore, have raised eyebrows. Shinzo Abe, the prime minister, says he will halt the population decline at 100 million.

This month he also set a target of raising GDP to 600 trillion yen, a post-war high. This would be a remarkable feat, points out Mr Motani: Japan’s highest GDP (523 trillion yen) was recorded in 1997, when the nation had nearly 10 million more workers

More babies

Abe’s pledge to raise the average birth rate to 1.8 children per woman (from the current 1.4) has also triggered much head scratching. The birth rate in Tokyo is just 1.1, points out Hidenori Sakanaka, a former director of the Tokyo Immigration Bureau.

A recovery of that magnitude would require nothing less than a revolution in employment practices at Japan’s corporations, with their punishing demands on young workers. “I believe it’s almost impossible,” Sakanaka concludes.

Shigeru Ishiba, once a candidate for prime minister and now the minister in charge of reviving Japan’s rusting local economies, waded reluctantly into the debate last week with a suggestion that the government has so far avoided: more foreigners.

“I believe Japan should further promote policy measures to accept immigrants,” he said. The appointment last month of Taro Kono, a rare political gadfly, as new minister for administrative reform, also seemed to promise a fresh take on the demographic problem. Kono has long urged the government to begin raising the immigration drawbridge.

But there is stiff political resistance to importing millions of foreigners into this still largely homogenous society. Yoshihide Suga, the government’s top spokesman, quickly dismissed the suggestion. Such a move would be “difficult”, said Suga last month – political code for “impossible”.

Japan is already wrestling with a growing shortage of labour. Over 80 per cent of Japanese firms struggle to fill jobs, says a new International Monetary Fund paper. This crisis will grow in the coming years, putting a break on growth in the world’s third-largest economy, say the authors Giovanni Ganelli and Naoko Miake.

The political and corporate response to this shortage has been creative, if nothing else. Robots have been drafted in to do much of the heavy-lifting in manufacturing. Abe has pledged to bring millions more women into the workforce.

The over-60s increasingly serve in supermarkets, drive taxis, work on construction sites and wear the uniforms of security guards.

Ganelli and Miake say these measures will not be enough to forestall economic decline. They too reach for the obvious solution. Japan has the second lowest (after Mexico) immigration rate in the OECD, they say.

“Japan’s reliance on foreign labour is only 0.3 per cent of its workforce”, far below the 5 per cent share in most advanced countries. They urge the government to expand programmes for guest workers and loosen entry requirements in sectors with labour shortages.

Roughly two million foreigners live in the country. Japan would need 10 times that number to make up for its looming labour shortfall.

Even if the political resistance could be overcome, where will all those workers come from, wonders Motani. He likens the official response to staring at the sea as a tsunami approaches and hoping it will never arrive.

Second-tier economy

Of course, Japan could accept a gentle economic decline and focus on making its crowded cities more livable and sustainable. But the government shows no sign of accepting that: Abe, a staunch nationalist, has explicitly ruled out “second-tier” economic status. Meanwhile, the country waits for its population tsunami to hit.