Trends and dimensions of the changing demography of Japan

The ongoing expression with respect to Japan’s demographics is that the country is facing a catastrophe. Since World War II the birth rates in Japan are falling further resulting in a declining working-age population. Therefore it becomes important to analyze the factors affecting the decline in the working-age population. The objective of this paper is to analyse the reasons for the changing demography of Japan and also identify the appropriate policies for the same. Post-WWII Japan has experienced falling birth rates with the fear that the Japanese population is ageing without replacement. Generally, the size of the economy does not influence economic development, if it is stable; Switzerland and Sweden are countries with fewer populations. The situation becomes worse when the process of declining is complemented with significant changes in age structures. The decline in the working-age population has both short term and long term implications on the economy. In 1926, Japan’s population reached 60 million, and in 1967, it crossed the 100 million mark. Japan’s total population was 127.09 million in 2015 as compared to 126.71 million in 2017 according to the Population Census (Table 1.1). Factors like traditional Japanese values on marriage, women, child-bearing, and immigration have led to the crisis. Many economists and researchers have suggested various policies like opening up to immigration, empowering women, providing social benefits schemes.

Why is Japan’s working-age population declining?

The fall in the working-age population is primarily due to falling fertility rates and birth rates, and the increasing life expectancy which have further resulted due to traditional Japanese values on marriage, women, child-bearing and immigration. An increase in the ageing population has created a larger financial burden on youth and the government due to costs associated with maintaining elder healthcare and pension payments. As we can see in Figure 1.1 Japan tends to have an intense vulnerability to natural disasters like earthquakes and tsunamis. On the basis of past experiences, the percentage of the Japanese population that is vulnerable to earthquakes and tsunami-related negative health outcomes will tend to increase. Lack of mobility during disasters is also one of the common causes of the vulnerability of the elderly population.

Table 1.1

Figure 1.1

In Japan, the social structure is such that they believe in male as a breadwinner and female as a homemaker. In such a setup, Japanese individuals are choosing to postpone marriages primarily due to increasing financial burden and increasing wedding costs and this phenomenon is evident in Table 1.2. Similarly, as per the societal norms, having children out of wedlock is extremely scarce therefore the declining marriage rates have resulted in a successive decline in total birth rates. In Japan, women have to often choose between their careers and childbirths. According to (Cooper and Hagiwara) paper, Japanese women who choose to work instead of staying home to look after their husbands are often termed as “Devil Wife”. Besides, post-marriage women are not provided equal opportunities at work and are generally degraded. Such perspectives have highly influenced the psychology of women and providing a social obstacle for women in Japan.

Table 1.2

The changing expectations of the workplace can also be considered as one of the reasons for the changing demographics of the country. The percentage of part-time workers in Japan is observed to be increasing post-1990’s due to which they tend to postpone marriages. Post World War II the formation of standard employment was on the basis of full-time employment. However, post-1990’s economic crisis, the domestic companies started to hire workers on a part-time basis due to cost reduction and social insurance made it cheaper to do so. The proportion of irregular workers in Japan is observed to be around 40%. The part-time employment rate is 22.4% (OECD Data). Currently, irregular employment is becoming a daily routine in the employment structure of Japan and has also resulted in “parasite singles” where an adult individual continues to stay with their parents due to economic constraints. As per the social norms in Japan, children are expected to take care of their parents in old age where the responsibility is shifted to the children’s, however, due to lack of permanent jobs a role reversal is observed. The labour force participation of women in Japan is around 60% as is evident in Figure 1.2.

Figure 1.2

Policy changes recommended

Earlier, the Japanese government had adopted different strategies to increase the birth rate “including the “women handbook” to educate women on high and low points of their fertility and state-sponsored matchmaking events.” Besides, the government has invested in child benefits and daycare systems as there are fewer daycare centres in Japan. Hence, apart from government-owned daycare systems, private enterprises were allowed to enter into the market to increase the same but these strategies have not been successful.

The potentially viable strategy which can help the Japanese government is relaxing immigration. Relaxed immigration policies will attract an international labour force which will further help the economy to survive on a short term basis. Immigration reforms are very complex in Japanese homogenous culture. The 2008 proposal from Japan’s Liberal Democratic party to increase the extent of immigrants to 10% was made. However, the government can not depend on immigration reform forever as it will make the economy vulnerable to external factors and pose a threat to the traditional ethnic Japanese culture. Hence, empowering women and designing such schemes which will induce birth rates is necessary. Inclusion of women in the labour force and providing family choices is an important component of women empowerment. Improving the status of working women will have a positive impact on the economy. If women are motivated to choose careers post marriage and children’s it will gradually lead to an increase in marriage rates which in turn will increase total birth rates in Japan. Similarly, the increase in daycare centres will allow women to choose to work again. The structural changes in employment with respect to permanent jobs or women employment will have a positive impact on the birth rates.

-Durva Shetye, Gokhale Institute of Politics and Economics