Causes of Japan's aggressively ageing and shrinking population
The Old Age Dependency Ration (OADR) is defined as the number of old age dependents (aged 65 or over) per 100 persons of working age (aged 20-64). It is commonly used to measure population ageing and to predict its decline. This figure is projected to increase in all regions of the world due to increasing life expectancy and decreasing fertility (Graph 1)[1]. A rapidly ageing population comes with a variety of issues associated with a shrinking labour force such as a decrease in economic growth and tax revenues, but an increase in the demand for age pensions, health services and age care services[2]. Japan has the highest OADR at 51 in 2019 and this ratio is projected to increase to 81 by 2050[3]. This article explores why Japan’s unique political and cultural environment made populating ageing and decline more aggressive compared to other nations of the OECD, such as Australia. This is despite similar demographic shifts that came from a change in economic and cultural conditions following the post-war era that created the risks of an ageing population within the OECD.
Graph 1:
Post-war era: decline in fertility below the replacement-level for most OECD countries
In the post-war era, countries within the OECD saw a rapid increase and then subsequent decrease in fertility[4]. During the baby boom (1946-1965 for Australia[5] and 1947-1949 for Japan[6]), total fertility rates and birth numbers were increasing due to a couple of reasons such as post-war optimism about the future, people simultaneously resuming family lives after postponing marriage and childbirth, as well as an increase in financial stability due to a post-war economic boom. After the baby boom, there was a subsequent baby bust as women delayed having children due to education and work commitments that stemmed from an increase in economic gains for women pursuing higher education than men. This was due to reasons such as changing laws and attitudes of women working, an increase in job opportunities for women due to the economic boom, and the restructuring of the labour market from being labour-intensive to being service-based[7][8][9]. When the average age of having the first child increases, the window of having more children after the first child is smaller as fertility gradually declines with age [10]. Where fertility has fallen below the replacement-level fertility of about 2.1 children per woman (which is the total fertility rate needed to keep the population constant from generation to generation), this sets the stage for an ageing population[11].
Deviations of Japan from other nations which led to their extremely high OADR: Immigration policies and extremely low fertility rates
Despite Australia’s fertility being below the replacement-level, the number of births in Australia continued to increase alongside the population which acts to decrease the OADR[12]. This is accredited to Australia’s immigration program which specifically aims to increase population since the end of World War II[13]. This is in contrast to Japan’s birth numbers and population which saw a steady decrease. This is due to Japan’s historically strict stance against immigration as introducing foreigners is seen as a threat to their homogenous culture. As a result, we see official figures of the immigrant population in Japan being the lowest in the developed world at around 1.25% (in 2010) and their OADR rising higher than other members of the OECD[14].
Although most OECD countries have total fertility rates below the replacement-level like Japan due to later marriages as discussed before, Japan is unique in the sense that the total fertility rate is well below the OECD average (Graph 2)[15]. This increases the OADR even more compared to other OECD nations. Brinton & Oh found that Japans extremely low fertility rate is due to the difficulty of engaging simultaneously in employment and childrearing for women in Japan. This is in contrast with an easier balance in moderately low fertility countries such as the United States, Sweden and Australia. The difficult balance is due to the culture of extremely long working hours, a lack of bargaining power over reducing working hours, as well as the pressure to stay at home to be a housewife as there is a cultural emphasis on mothers being the primary caregiver. Even if both parents work full-time, the gendered division of household labour means that it is even more unlikely that women will have a second child. These factors make childbearing less appealing, especially for highly educated, career-driven women[16].
Graph 2:
Policy comparisons and implications of mitigating the impact of an ageing population: Immigration, better work-life balance, better marriage package for women
We can now see that in order to mitigate the issue of an ageing population, immigration can be a potential option. Currently, Japan is already experiencing increasing financial pressures from the impacts of a decreasing working-age population; the simultaneous decrease in tax revenue and the increase in demand for old-age pension schemes, medical care programs, and the long-term care plan. These costs have been shifted to families and have been putting pressure on their finances. Furthermore, labour shortages mean that there is a danger of slower technological progress and a shortage of care-workers for the sick and elderly[17].
There is a current tension between policies prohibiting the importation of unskilled workers from abroad and the need for unskilled labour. However, the issue is that Japan may not be prepared to accept foreigners. Data from five rounds of the Japanese General Social Survey suggests that only 1/3 of respondents have positive attitudes towards having foreigners in their communities and this statistic had hardly changed over several decades[18]. Looking more in-depth into what is creating the negative perception of immigrants, Green et al. found that one of the main drivers was the language barrier. Individuals with higher levels of English speaking abilities had more positive perceptions of foreigners in their communities. Thus, a possible policy can be to improve conversational proficiency through the education system, instead of its current heavy focus on reading and writing. However, a further issue is that by the time Japan is ready to open its borders to foreign workers, there may be an insufficient supply of labour in the region as other developing Asian countries experience the same problem of an ageing population[19].
There is also a need to implement a better work-life balance for families to prevent the trade-off between pursuing a career and childrearing in order to increase fertility and thus decrease the OADR. Western countries have managed to achieve a better work-life balance, though it appears that Japan continues to lag behind. Japan’s parental leave scheme has major shortcomings such as limited coverage, low levels of income compensation, and a lack of legal binding authority. For example, even when parental leave exists, there are no legal sanctions for companies for non-compliance. In 2010, 70% of small organisations did not have rules on parental leave and only 84% of eligible mothers took parental leave in Japan. Furthermore, there is a shortage of daycare centres, and public spending on family benefits as a percentage of GDP remains well below the OECD average as well. Overall, Japan ultimately ranks second last amongst the OECD countries in terms of strength and coverage for family-friendly work arrangements which takes into consideration factors such as childcare services, childcare leave, and flexible work arrangements[20]. Unsurprisingly, these family policies have been largely ineffective and critiqued by experts as being ‘half hearted’, especially in the face of serious demographic and socioeconomic consequences from the persistence of very low fertility[21].
Finally, apart from the need for better policies to enable individuals to have sufficient finances and time to get married, have children, whilst holding down a job, a better marriage package is also needed specifically for women through a cultural shift. Even if there are enforceable laws for parental leave and high-income compensation, if females are expected to take on all the caretaker duties within a marriage, it will lead to issues with their careers and their own work-life balance. Wives may be socially pressured to quit their jobs after childbirth, work the double shift where they work full time and shoulder most of the domestic duties when they return home from work, and may even be discriminated against in regard to their personal career advancement. Husbands may also be socially pressured not to take any paternal leave and may expect that the wife alters her career and work schedule to care for the child. Marriage will be seen as a social trap or a burden and appear to be very unattractive in an environment where there are increasing economic opportunities in the labour force and equalising of gender roles in the workplace. For example, men’s contribution to housework in Japan has remained notably low at less than 5 hours a week, regardless of his wife’s hours of work a week (Graph 3). Even if there is marriage, the probabilities of having more than one child are very slim due to the same reasons[22]. As compared to other nations, the traditional marriage package where women shoulder most of the domestic burden is slowly breaking down in many Western countries where the difference in domestic responsibilities between men and women has been narrowing significantly[23]. In an attempt to improve fertility rates, a variety of policies were implemented by the government to encourage men’s participation in domestic labour. For example, in 2006, the word “Ikumen” was coined to describe a cool dad who looks after children. This word subsequently became popular in mainstream media such as magazines, anime, and social media. The government even launched an “Ikumen Project” to encourage men to actively look after their children via information brochures, internet websites, videos, TV and poster campaigns, company awards and more. Apart from the governmental efforts, the Japanese media and non-for-profit organisations also published books and created workshops teaching men how to be an Ikumen. However, these efforts have yet to bear any fruit, as most Japanese men still have the deep-rooted belief that men are meant to be breadwinners and women are meant to take care of the house[24].
Graph 3:
Taking inspiration from other nations’ successful policies, Japan may wish to implement similar policies conformed to its conservative social environment to combat the problem of an ageing population. This may include creating an environment for cross-cultural cohabitation where there is not only a greater acceptance towards foreigners to create political approval for immigration but also enough support for immigrants to assimilate themselves into the Japanese culture. In order to encourage marriage and childbirth, Japan must accommodate for the inevitable rise in dual-income households through improving its work-life balance as well as implement a cultural shift towards a more equal division of labour within the household. These measures will help mitigate the impact of an ageing population by increasing the working-age population and increasing the total fertility rates.
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[19] Green, D Kadoya, Y 2013, English as a gateway? Immigration and public opinion in Japan, working paper, The Institute of Social and Economic Research (ISER), Osaka University, Osaka, https://www.econstor.eu/bitstream/10419/92877/1/766845818.pdf
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[24] Bruning, B 2020, ‘Ikumen – The new fathering in Japan: How do organisations and governmental reforms in family policy affect the involvement of Japanese fathers in parenting?’, ResearchGate, https://www.researchgate.net/publication/345894748_Ikumen_-The_new_fathering_in_Japan_How_do_organizations_and_governmental_reforms_in_family_policy_affect_the_involvement_of_Japanese_fathers_in_parenting