A Deep-Dive into Japan's Declining Birthrate

Japan is the oldest nation in the world, but how bad is it really? This article dives into the facts about the country's plummeting birthrate and its socio-economic implications.

We've all heard it echoed time and time again — "Japan has the world's lowest birthrate." It's become almost common knowledge, woven into global discussions whenever the country is mentioned. The tales are endless: Japan's work-centric culture, the financial pressures of raising a child, young people's waning interest in relationships, the rise of solo living, and even the societal complexities faced by potential parents. The list goes on.

However, while these explanations might scratch the surface of popular understanding, do they truly capture the depths of the issue? How much of what we hear is mere speculations, and how much is rooted in raw facts? With a multitude of reasons being thrown around, it's easy to get lost in the noise.

That's where I step in. I'm not here merely to skim through surface-level assumptions or indulge in speculative talk. I will delve deep, relying on hard facts and figures, to uncover the true dynamics of this crisis. To do this, I have read Miyaji Hidesaku's book "Learn Economics from Statistics!" (original title: “経済は統計から学べ”) that dives into the vast statistical realms, spanning from population issues, resource wars to poverty and education.

With a vast sea of statistical data at our fingertips, we're about to embark on a journey to understand not only where Japan stands today, but also the trajectory its headed towards.

Let's break through the myths and confront the stark reality:

Why is Japan’s Birthrate so low?

Akino Imanaka is the only student in the high school of Oteshima island, Japan, in 2023.

To comprehend this issue, one must separate and understand the intertwined phenomena of decreasing births and an aging population.

The term "decreasing birthrate" refers to the reduction in the population of children under 15 and its shrinking proportion within the total population. Meanwhile, "aging" describes the scenario where, as a result of this decreasing birthrate, the proportion of the elderly (65 and above) grows in the total populace.

In 2020, Japan recorded 848,832 births – a decrease of 24,407 from the previous year and the lowest in five consecutive years. The Total Fertility Rate, representing the number of children a woman would have in her lifetime, stood at 1.34, marking its fifth consecutive year of decline.

Historical birth data highlights another dramatic shift. While the majority of mothers in 1970 were aged between 25 and 29, today, those between 30 and 34 dominate. To make matters worse, the population of women aged 25 to 39 is dwindling, with no signs of a forthcoming increase.

Hence, the trend of decreasing childbirths can be attributed to two primary factors: A declining number of potential mothers and a tendency towards later childbirth.

On top of that, the uncertainties brought by the Covid-19 pandemic seem to further accelerate this decline.

Death rates, on the other hand, recorded a decrease with 1,372,648 deaths in 2022, a decline of 8,445 from the previous year. However, a population living even longer (with all the strains it causes on Japan’s government) has not been enough to stop Japan’s population from shrinking. Hence, the natural growth, calculated by subtracting deaths from births, saw a decline of 531,816 in 2022.

This trend, however, signifies more than just statistical data; it unveils the profound and tangible consequences shaping Japan's socio-economic landscape. One glaring example is the nation's approach to innovation. Japan, despite its technological prowess, witnesses a perceptible hesitancy towards rapid technological shifts among its elderly population. This demographic, rooted in familiarity, often leans towards established technologies and methods. The result is an unexpected resistance to embracing cutting-edge advancements. An illustrative point here is Japan's predominant reliance on cash transactions. Even in the age of digital revolution, cash dealings in Japan, as of 2020, constituted about 80% of all payments. This reticence not only hinders Japan's potential leap into futuristic innovations but also presents a challenge for younger, tech-savvy generations eager to drive change.

Japanese shops are still the least likely to accept credit cards in the OECD (Al Jazeera, 2023)

Further complications arise on the economic front. A shrinking younger demographic now bears the weight of an increasing elderly population, amplifying the tax burdens on working individuals. This, coupled with Japan's soaring public spending, primarily in healthcare and pensions for the elderly, has led to a precarious fiscal scenario. Japan's debt-to-GDP ratio, surpassing 230% by 2021, rings alarm bells, suggesting potential financial crises if left unchecked.

The country first experienced a population decrease in 2005. Though there was a brief flicker of hope with a period of natural growth in 2006, the downtrend resumed from 2007 onward, adding to the socio-economic challenges.

In essence, while the declining birthrate and aging population pose significant hurdles, understanding their multifaceted implications is crucial. These issues intertwine with Japan's societal fabric, its global economic stance, and its innovative potential, emphasizing the need for adaptive strategies and forward-thinking solutions.

From Baby Boomers to Pensioners

In Japan, significant birth surges occurred from 1947-1949 and 1971-1974, famously termed the "baby booms." The first boom, just after WWII, counted over 8 million births, or an 11% increase in Japan’s overall population in three years! This generation, often referred to as the "Post-war Generation," started receiving pensions from 2014 onwards.

The later boom, between 1971-1974, saw annual births exceeding 2 million. This led to Japan becoming one of the world’s most competitive academic environments when this generation entered universities in the late 80s to early 90s. This insane competition in such a wealthy country spawned a whole industry of cram schools and university preparation schools, that has since been mimicked worldwide.

An “aging society” is said to exist when the percentage of the elderly population exceeds 7%, an “aged society” when it exceeds 14%, and a “super-aging society” when it exceeds 21%.

Japan's aging rate surpassed 7% in 1970, classifying it as an "aging society." This rate crossed 14% in 1994 and 21% in 2007. By 2019, a staggering 28% of Japan's population was elderly — the highest worldwide, with Italy trailing at 23.01%.

Countries with the highest percentage of seniors (Nippon, 2022)

This rapid aging, underpinned by an equally rapid decline in births, signals a future where the working-age population might exist predominantly to support the elderly.

Why is the Japanese population declining?

At the core of this question lies Japan's intricate social dynamics that merge traditional customs with modern realities.

Historically, marriage has been a precursor to childbirth in Japan. This isn't just a cultural phenomenon; it's deeply ingrained in the nation's societal fabric. Japan has a unique relationship between marriage and birth rates compared to many western nations. While in countries like Sweden or France, out-of-wedlock births are more commonplace, in Japan, this is the exception rather than the norm. For instance, in 2013, a staggering 98.07% of births in Japan were within wedlock. In other words, the correlation between marriage and birth rate remains starkly evident.

A traditional Japanese marriage ceremony

While traditional cultural values still play a role in these patterns, the modern societal challenges further intensify the issue. The latest data reveals a deeper economic divide and a changing perspective on work-life balance:

• Economic Pressures: With increasing living costs in urban areas, stagnant wages, and a sense of job insecurity, the financial burden is a major impediment. In a 2021 survey, about 35% of respondents in their 30s cited economic instability as a significant reason for delaying or avoiding marriage and child-rearing. This figure was up from approximately 28% a decade earlier.

• Work-Life Balance: The traditional Japanese work culture, often encapsulated by the term "Karoshi" (death from overwork), continues to dominate. However, there is a growing awareness and desire for a better work-life balance, especially among younger generations. In a 2022 study, 40% of respondents aged 20-40 mentioned that they value personal time and work-life balance more than their parents' generation, further accentuating the clash between traditional expectations and modern aspirations.

• Gender Roles and Responsibilities: Modern Japanese women are more educated and career-oriented than ever before. A 2020 survey noted that over 65% of women in their 20s and 30s want both a fulfilling career and a family, up from 55% a decade earlier. However, the same survey highlighted that societal and familial expectations, coupled with limited support for working mothers, often make this aspiration challenging.

This discord between tradition and modernity is a significant deterrent for young couples contemplating starting a family. The lack of supportive infrastructures, such as affordable child care, combined with the long working hours culture, exacerbates the challenge of raising children. Moreover, financial constraints, such as the rising costs of education, often deter couples from having more children.

What's Next for Japan?

"To birth" and "to nurture" — these are two fundamental facets of a society, and one can't help but urge the Japanese government to swiftly lay the foundations of a society where both are equally prioritized.

An opportunity for Japan is to learn from global counterparts and adapt.

Take for instance countries like France and Sweden. Both nations, spurred by proactive policies countering the low birthrate, witnessed a revival in their fertility rates, edging close to the population replacement level (around a Total Fertility Rate of 2.1).

Since the 1990s, France embarked on initiatives that enhanced childcare facilities, enabling a harmonious balance between childbirth, child-rearing, and work. After bottoming out at a rate of 1.73 in 1993, France's fertility rate rebounded impressively to 2.03 by 2010 (standing at 1.87 in 2019).

Sweden, too, bolstered its support for those juggling childbirth, child-rearing, and professional commitments. They introduced benefits like child allowances, which increased with the number of children, and a parental insurance system (introduced in 1974), which provides income compensation during parental leave, and made it easier for unmarried couples to receive the same child-care benefits as married one. As a result, more children are now being born out of wedlock than in, and the country that recorded a fertility rate of 1.5 in 1998 saw it climb to 1.98 by 2010 (with a rate of 1.80 in 2019).

Break Tradition or Face Decline?

In fact, Japan has in some ways already broken the negative fertility rate spiral. In 2005, its fertility rate stood at a worrisome 1.26, echoing fears of a dwindling future. Yet, by 2015, the country showed signs of resurgence, with the rate climbing to 1.45.

But what sparked this change? Let's turn the pages of recent history.

During this decade, the Japanese government made significant strides in its social policies. Childcare facilities saw a massive expansion, attempting to meet the urban cries of young parents trapped in long waitlists. By 2014, there was a 20% increase in public childcare centers across major cities like Tokyo and Osaka, a direct testament to state efforts.

And we cannot forget Womenomics – an ambitious initiative rolled out in the early 2010s by none other than the now deceased prime minister Shinzo Abe. Its aim? To elevate the role of women in the workforce and create a domino effect. As more women entered and thrived in the professional realm, it was believed that the infrastructure supporting them, from childcare to flexible work hours, would naturally improve, indirectly boosting the fertility rate. Even though the initiative failed to reach much of its intended goals, by 2017, the female labor participation rate had reached nearly 70%, a record high.

Moreover, Japan's parental leave policy, one of the most generous globally, offered upwards of 58% of an employee's salary for a year. This was a bold move, reflecting Japan's commitment to striking a balance between work and family life.

Yet, statistics showed that while women increasingly availed of this benefit, only 7% of eligible men took parental leave in 2019. It wasn't a policy failure but a cultural hesitation. Here lies the heart of Japan's challenge: its rich tradition, while a source of strength, sometimes casts long shadows on modern aspirations.

My Thoughts on Japan's Next Steps

In sifting through the statistics and decoding Japan's socio-economic trajectory, I can't help but present my perspective on what could be the blueprint for Japan's renaissance.

Drawing from available data, a solution shines brightly: boosting public childcare facilities. If Japan were to bolster its childcare amenities by an additional 30% over the next decade, we could potentially see it servicing almost 80% of the demand, particularly in urban locales. This move could bring about substantial relief to young working families, especially in metropolitan areas where the balance between work and family care is most skewed.

Moreover, I propose a rather novel approach to shatter some existing workplace conventions: Why not introduce corporate recognition and perhaps even monetary benefits for firms that exhibit the highest percentage of fathers using parental leave? Such an initiative could spark a broader cultural change, challenging and eventually breaking deep-seated norms that have persisted for generations.

The notion of Womenomics isn't foreign to Japan. However, the next chapter — let's call it Womenomics 2.0 — should amplify its intensity. This shouldn't merely be about fostering female participation in the workforce; it needs to zero in on facilitating women to ascend to leadership roles. By ensuring women aren't just participants but leaders, Japan can play its part in smashing the proverbial glass ceiling, thereby setting a gold standard for other nations to emulate.

That said, let's briefly touch upon the subject of immigration, a frequently touted solution to foster Japan's birthrate. Undeniably, immigration can serve as a short-term remedy. Historically, countries that have opened their doors to immigrants have witnessed an initial surge in birthrates. For instance, in many European nations, upon welcoming a significant number of immigrants, there was a noticeable uptick in birthrates. However, as time progressed and as these immigrant communities adapt to the societal norms and systems of their host countries, their birthrates eventually tapered off, regressing to the host nation's average. Essentially, while immigration can provide a much-needed boost for Japan, relying on it as a long-term solution might be comparable to placing a band-aid on a deeper wound.

In this intricate ballet between preserving the past and embracing the future, Japan stands at a pivotal juncture. It possesses the innate potential to choreograph a groundbreaking narrative of revival. Marrying the sage teachings of its history with the prophetic insights of contemporary data, Japan is perfectly poised to craft a tale where the richness of tradition seamlessly fuses with the aspirations of tomorrow, ensuring a luminous future for all its subsequent generations.

Conclusion

The demographic predicament that Japan faces is both alarming and complex. The profound decline in birthrates, coupled with an increasingly aged populace, threatens to reshape the very fabric of the country. At the heart of this crisis lies deep-rooted cultural norms, economic pressures, and societal expectations, which have created an environment not conducive to family expansion.

If unchecked, these issues could have dire implications for Japan's future. A declining workforce could stunt economic growth, burden the healthcare system, and strain public finances. With a larger elderly population and a shrinking younger generation, the financial and social weight of supporting the retired and elderly would inevitably fall on a decreasing number of working adults. This imbalance could lead to increased taxation, potential labor shortages, and intensified societal pressures on the young, further discouraging family formation.

Furthermore, an aging populace might weaken Japan's global influence and competitive edge in innovation, technology, and other sectors. The nation's cultural vibrancy could wane, and younger generations might be drawn to opportunities overseas, further accelerating the population decline.

Yet, history offers lessons, and the experiences of countries like France and Sweden suggest that with targeted interventions, the demographic tide can turn. However, such transformations necessitate more than mere policy tweaks. They require a holistic re-evaluation of societal values, economic strategies, and work-life dynamics.

In summary, Japan stands on the precipice of a demographic chasm. The decisions made now will either pull it back from the edge or see it tumble into an uncertain future. The gravity of the situation demands urgent attention, introspection, and robust action.