According to the United Nations World Population Prospects 2019 report, the world’s population is projected to increase by two billion people in the next 30 years – from 7.7 billion people in 2019 to 9.7 billion in 2050 (United Nations, 2019). The report offers a comprehensive outline of global demographic patterns and prospects and concludes that nearly 11 billion people are predicted to inhabit our planet by the end of the 21st century (United Nations, 2019).
While countries such as Pakistan, the Democratic Republic of the Congo (DRC) and the United States of America are expected to make up half of the projected growth, the populations of countries in Europe and the Carribean are expected to deplete (United Nations, 2019). While most Asian countries’ populations are expected to grow exponentially, Japan stands out as a country with the fastest depleting population in Asia and worldwide – making the issue of an ageing society a top policy priority for the nation (United Nations, 2019).
Japan’s ageing society
2018 marked Japan’s 35th anniversary of reaching its status as the world’s oldest population in the world (CEPR Policy Portal, 2018). More than a quarter of Japan’s population is aged over 65 and this is set to increase by 40% by 2025 when the overall population will have shrunk from 127 million in 2019 to 90 million (BBC News, 2015). Japan stands out with 1.8 people aged 25 to 64 for each person aged 65 or over, and it has one of the lowest ratios of people of working age compared to those older than 65 in the world (United Nations, 2019).
The country is home to the longest ever recorded life expectancies and the highest elderly population share worldwide at 27% (CEPR Policy Portal, 2018). Japan also has one of the lowest annual birthrates in the world and a continuously decreasing birth fertility rate (CEPR Policy Portal, 2018). In fact, the birthrate in 2016 was 976,978 children, the estimate was 918,397 children in 2018 – which is a decrease of roughly 6% (Nippon.com, 2019). With the population declining, rapidly ageing, and the birthrate depleting, the economic, political, and societal prospects for Japan are grim - especially for young people.
Japan has had a long tradition of respecting their seniors and having a strong obligation to care for them (Independent, 2018). While the responsibility of families caring for their seniors is formally embodied in Japan’s welfare system, the changes in the country’s demographic structure are having profound implications for the youth (Independent, 2018).
Japan’s youth under pressure
The pressure on Japan’s youth is growing, as more and more young people are taking care of their older family members. Approximately 177,600 people aged between 15 and 29 are caring for a family member (BBC News, 2015). And while there are certain financial advantages, such as low living costs, the extra work causes pressure, unhappiness, and loneliness (BBC News, 2015).
As they have to take care of their family members most of the day, the only career option they have is to work part-time or take on night shifts (BBC News, 2015). Regular full-time jobs are impossible (BBC News, 2015). It also means that they have less of a social or love life as they do not have time for friends nor a prospect of starting their own family (BBC News, 2015).
And while many of them may think that it would be better to quit and stop caring, many young Japanese say that they would feel guilty for not supporting their older family members as they were the ones supporting them while growing up – at least, that is the argument (BBC News, 2015).
Thus, what is needed to improve the situation for young Japanese are targeted and concrete policies that are designed to counteract the overall demographical issues, such as a declining and aging population and depleting birthrate. However, the overall situation is not promising despite some governmental responses.
Potential policy solutions
Indeed, Japan has already introduced potential solutions to counteract an ageing population in the 1990s. For instance, in 1999, the government introduced the “The New Angel Plan” and the “Plus One Policy”, which would make it easier to have children: New funds for child-bearing families became available, family housing was improved, and education costs were decreased (CEPR Policy Portal, 2018).
More recently, and also most famously, the current Prime Minister Shinzo Abe introduced his economic policy package “Abenomics” to partially reduce caregiver burdens and minimise health care costs for Japanese people (CEPR Policy Portal, 2018). Policy changes included: Investing more in children's education, relaxing the country’s immigration restrictions – to augment the workforce – and gradually increasing the consumption tax to bolster the integrity of the social security system (CEPR Policy Portal, 2018).
Also, in 2000, Japan introduced one of the most comprehensive social care systems – the long term care insurance (LCTI) – to reduce the burden on family members (Kawedzija, 2018). The insurances cater to all Japanese people aged over 65 and have become widely embraced (Kawedzija, 2018). And while it caters to the specific needs of the elderly and promises local social care, the eligibility criteria, which were initially quite liberal, have become stricter as user numbers have increased.
A big problem of most of these policies remains, however, the costs. Looking ahead, the Japanese government projected that it will spend one-fourth of its gross domestic product (GDP) on social welfare by 2040 – with annual costs of around 190 trillion yen ($1.7 trillion) (Nikkei Asian Review, 2018). Thus, decreased health care costs and long time health insurance cannot be the final answer to the issues. So what can be done?
Delaying retirement to finance social protection
One of the most obvious policy ideas to counter the financial challenges of an ageing population would be to raise the retirement and pension eligibility age. Such policies can be implemented quickly and would be realisable as soon as they are implemented (CEPR Policy Portal, 2018). Furthermore, they would allow an increase intax revenue for the government and an increase in financial stability for elderly Japanaese as they can earn and save money for a longer period (CEPR Policy Portal, 2018).
Japan is already considering raising the current retirement age from 65 to 70, or even 75, while it also promotes the elderly to exercise more (Reuters, 2019; Bloomberg, 2012). The idea: As they work longer and exercise more, they remain fit and healthy, which translates to fewer medical expenses that would save tax spending, which could be used for other benefits (CEPR Policy Portal, 2018).
Immigration for workforce support
Another obvious policy idea would be to relax immigration restrictions. However, the topic has been highly unpopular and controversial among Japanese (CNN, 2018). Japan is one of the world’s most homogenous societies, with foreigners making up less than 2% of the population (CNN, 2018). While there have been campaigns to allow more foreign workers into the country, by removing some of the entry and visa requirements as well as changing the country’s immigration law, there have been suggestions to only allow them into the country if they would live in separate communities; which is already the natural case for some Korean and Brazilian communities in Japan (BBC News, 2015; CNN, 2018). Prime Minister Abe has stated that he would be keen to support expanding the programme for foreign caregivers but said that they would need to go home after three to five years, which also does not speak to a long term solution (BBC News, 2015).
And even if trained and certified workers would like to work and live in Japan, there is a language barrier, which has been somewhat systematically enforced. Foreign caretakers find it extremely difficult to pass the national exams as they are held in Japanese, which most cannot speak fluently within just a few months (BBC Worklife, 2018). Many come to Japan with no or little knowledge of the language and thus, would need to learn the language first. That is why the number of foreign nurses and carers in temporary caring homes has been extremely low; only 304 in 2015. In fact, many have applied but most applicants and test-takers failed due to the language barrier (BBC News, 2015).
Communal solutions for elderly care
Another interesting but less obvious policy solution would be the idea of supporting the growing number of households in which the elderly take care of themselves in shared flats (BBC News, 2015). This approach could support the Japanese elderly who do not have a family to rely on. What’s more, many elderly become lonely and resort to negative coping strategies to stay occupied. In fact, there has been an increasing number of cases over the past 20 years of people aged over 65 committing crimes such as shoplifting as they feel lonely, bored, or lack money to buy necessities (BBC News, 2019). It goes so far that some elderly even have the desire to go to prison as they would at least have a community and friends around them (BBC News, 2019).
Flat shares help to fight loneliness and compensate for a lack of young family members to provide support (BBC News, 2015). However, such policies are not ideal. There have been cases where seniors were killed by their caretakers who became too tired to provide effective care (BBC News, 2015).
Japan is a rapidly shrinking and ageing society. This presents great economic and social challenges. As more and more Japanese people grow old, the more young people need to step up to taking on care responsibilities. This culture of care my be culturally embedded, however, systematic government social protection interventions will be required, beyond the family, to support the country’s elderly.
Several strategies can address Japan’s ageing future, such as more foreign workers, increasing the retirement age, and investing in Japan’s families and children. Letting foreign caregivers and workers in would also ease the financial burden on the government, while flat shares would fight loneliness and compensate for the lack of family members. However, none of the solutions are ideal. Japan will likely serve as a global leader in implementing comprehensive social protection tailored to the needs of the elderly.
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