Chase Franklin International: Economy and Declining Population
Japan’s population is aging faster than most of any other developed countries in the world and its economy is getting slow due to a drop in demand from emerging markets and consumption at home. The Abenomics program could include a new reform that is now missing from the plan in order to revive the country’s economy and to slow down the declining of population: immigration.
The secret to accelerate the pace of economic growth and to fight against the declining of population could be in letting more foreign workers in, according to Standard & Poor’s global chief economist Paul Sheard.
Japan was at 128.9 million people in 2010 and is set to fall below the 100 million mark in 2048, but the country has been reluctant to allow more foreigners in and there is hardly any mention of such plans under Abenomics, the international media comments.
Japan’s birth rate, currently 1.39 children per woman, has sunk to record lows. Because their salaries have stagnated for years, Japanese men became increasingly less attractive to women and many couples did not get married or had babies anymore due to the economic uncertainties.
All these issues have led to less and less working-age people. Japan has been trying to raise its birth rate, but even if it successfully did that tomorrow, it will take at least a generation before it solves its demographic problems. A shortcut cure would be immigration reform, Sheard says.
Immigrants could contribute to the population’s growth and they are more likely to have many children. Allowing more immigrants to settle in Japan could also encourage more women to stay in their careers and would ease labor restrictions over childcare facilities, helping to make it easier for working women, according to Sheard.