Chart of the week – Japan’s ageing population

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Chart of the week: Japanese population and age structure, 1950 – 2050

Japan’s population peaked in 2010 at just over 128 million. It has since begun a sustained decline that is expected to accelerate over time, reducing the population to fewer than 100 million by 2050. At the same time, the elderly (65+) share of the population is projected to rise from about 26% today (the highest in the OECD) to around 40% at mid-century.

historical population data and projections japan

Source: OECD (2016), OECD Territorial Reviews: Japan 2016, OECD Publishing, Paris.

On 11 April 2016 the OECD published a territorial review for Japan. The OECD’s territorial reviews contain “analysis and policy guidance to national and sub-national governments seeking to strengthen territorial development policies and governance.”

As the OECD notes in this review “Japan is embarked on a demographic transition without precedent in human history: the population is both declining and ageing rapidly.” As such the Japanese experience, says the OECD, is likely to “be of first-order interest to other OECD countries, as most face the prospect of rapid population ageing and many are also projected to experience significant population decline over the coming decades.

Among the OECD’s key findings in this review are the following observations:

Japan’s future prosperity depends more than ever on productivity. Japan’s working-age population is shrinking  by about 1% per year and this is expected to accelerate to 1.7% in future decades. To maintain aggregate GDP growth of 2% per annum between now and 2050, there will have to be a signficant increase in GDP/worker. In reality this will require an improvement in productivity and labout supply. As Japan has very strict controls on immigration, the mobilisation of women and older workers will be key.

Japan’s demographics will have important spatial consequences. Depopulation will, according to the Japanese government mean that more than 60% of the inhabited grid squares in Japan will lose over half their population by 2050, with almost a fifth becoming uninhabited.

The concentration of both population and economic activity, already high in Japan, will rise further. Japan’s three main metropolitan areas occupy 5.2% of the country’s territory but are home to 46% of its people and generate half the GDP. Depopulation is expected to have a major impact on many rural areas and small towns.

Economic disparities within Japan’s population are relatively low and do not appear to be increasing. This reflects a “long-standing commitment to well-defined levels of infrastructure and service provision in Japan. [divider] [/divider]

This article was written on 21/04/16 in Paris

For more on this subject, read:

Imploding populations in Japan and Germany published 01/06/15

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