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Japan’s birthrate up for third straight year in 2008 as population decline continues

Since hitting an all-time low of 1.26 in 2005, Japan’s birthrate has now increased for three consecutive years, hitting 1.37 children per woman in 2008, according to a report released by the Ministry of Health, Labour and Welfare on Wednesday.

The birthrate is up from 1.34 in 2007. The nation’s highest birthrate was registered in Okinawa, at 1.78 children per woman. Okinawa was followed by Miyazaki (1.60), Kagoshima (1.59), Kumamoto (1.58), Fukui (1.54), Oita (1.53), Saga (1.55), Fukui (1.54), Oita (1.53), Fukushima (1.52), Shimane (1.51) and Nagasaki (1.50).

The highest birthrates in Japan are thus generally seen in the more southern parts, especially Okinawa and Kyushu. Unsurprisingly, the nation’s lowest birthrate was found in Tokyo, at 1.09 children per woman. Hokkaido was the second lowest at 1.20, and Kyoto and Nara each registered a 1.22 birthrate.

Although the birthrate increase is good news, we will have to wait another year to find out the effects of the current recession on the 2009 birth rate.

There is also plenty of dismal news in the report. The number of deaths in Japan hit 1.14 million in 2008, up by about 34,000 from 2007 and the highest figure on record since 1947. Likewise, population growth was at a negative in 2008, as the population declined by 51,317. This figure was at an all-time high, and showed a large percentage increase from the gap of 18,516 seen the year before.

10% of Japan’s population now over 75: Statistics Bureau

In 1950, 1.3% of Japan’s population was over the age of 75. Today, that same group of people make up over 10% of the population, according to the Ministry of Internal Affairs and Communications. Thus, as the Japan Times sums it up, “As of Nov[ember] 1, Japan’s population was estimated at 127.79 million, with 12.76 million…aged 75 or older.”

On the other side of the birthday cake, those aged 14 or younger accounted for 13.5% of the population as of November 2007. In 1950, that same age group represented 34.5% of the population.

As the chart to the left (click for a full-size view) indicates, Japan’s population is growing increasingly top-heavy. In a draft copy of its annual policy statement released yesterday, the Cabinet Office stated:

The state of the country’s public finances is extremely severe and it is apparent that future generations will be forced to bear a bigger burden as the population further shrinks and ages.

The paper goes on to recommend a 3 percent cut in public spending, which may leave some scratching their heads, since Japan’s politicians - especially in the ruling Liberal Democratic Party - have been calling for the exact opposite; they would like to put public spending on the rise, in order to please their constituencies with jobs and money, with the endgame being to hold off the rising opposition Democratic Party of Japan.

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Future of Japan’s workforce looking gloomier than expected: Ministry of Health, Labor and Welfare

On Friday, the Ministry of Health, Labor and Welfare announced more gloomy news for the future of Japan’s economy. According to the Ministry, Japan’s labor force stands to fall by 4.4 million workers over the next decade, and could lose up to 10.7 million workers by 2030. The ministry also stated that if measures were taken to allow women, elderly people and young people to find work more easily, the loss to the workforce over the coming decade could be limited to one million workers.

The ministry reported that in 2006, 48.5% of the nation’s women of working age held jobs, a decline of 1.5% from 1996. The ministry also claimed that workers facing mandatory retirement ages see less and less of an incentive to return to work, as companies continue to re-hire them at lower wages.

Immigration was not mentioned as a potential step to take against the reduction of the size of the workforce, and thus we find little reason to suspect that any sort of immigration plan or reform will be included in government plans to prevent the size of the workforce from shrinking at a slower rate.

Japanese government wants men to have more family time

The Asahi Shimbun today reported on government plans to “halve in 10 years the percentage of workers who put in 60 hours or more a week from 10.8 percent in 2006″ and also “to raise the percentage of male workers who take child-care leave to 10 percent, up from the current 0.5 percent.” The stated goal of this program is to increase the nation’s birth rate.

The plan to keep men from working so much, however, seems to have fatal Catch-22: if Japan’s men work less, who will pick up the slack? According to the government, women and the elderly will. The Asahi tells us:

[T]he government aims to have 69-72 percent of women between 25 and 44 in the work force in 10 years, up from the current 65 percent…The government also aims to raise the rate of women in employment after their first childbirth to 55 percent in 10 years, up from the current 38 percent…For people in the age bracket between 60 and 64, the employment-rate targets, also in 10 years, are 79-80 percent for men and 41-43 percent for women, up, respectively, from the current 67 percent and 39 percent.

So…if more women are working more hours - which they should be able to do if they want to - who is going to have these children?

For me, the kicker was this statistic: “[T]he government plans to have workers take 60 percent of their paid leave in five years, up from the current 47 percent.”

I’ve always taken 100% of mine. I guess I’ve always felt I’ve earned them.

Number of Employees at Japan’s Manufacturers Increased in 2006

Here’s one that took us somewhat by surprise: the Ministry of Trade, Economy and Industry is reporting that the number of employees at Japan’s manufacturing firms increased in 2006, for the first time in 15 years. According to the ministry’s data, 7,473,379 people were employed at manufacturing firms with ten or more employees at the end of 2006, a 2.3% gain over the previous year.

41 of Japan’s 47 prefectures saw an increase in the number of workers in the manufacturing industry, with automobile makers leading the way. Are we supposed to think that the hollowing out of domestic manufacturing has come to an end?

Japanese robots in the news again; elderly aren’t buying them

Personally, I never bought the line that Japan was in a rush to develop robots to care for its elders in order to provide them with personal care and attention that would not have to possibly be provided by a foreigner. Of course, with Japan’s upcoming demographic crunch, it’s probably not a bad idea to mechanize some repetitive, low skill tasks - such as…ahem…making sushi.

Ok, that’s half tongue in cheek. But the point is this: over the past two years or so, I have seen several articles in the foreign media, including a notable one by the Economist, state that one of the driving factors behind Japan’s research and development in the robotics field was due to the fact that elderly Japanese people would rather be taken care of by a robot than a foreigner.

This is hogwash, of course. Last week, a article entitled Japanese wrinklies spurn robot helpers appeared in The Register. My first reaction was, “Well, they can’t afford them right now.” My second reaction was, “Who let that headline through?”

The article cites a recent Reuters article that dealt with the issue of poor robot sales. Reuters quotes Ruth Campbell, a social worker in Tokyo, as saying:

Most (elderly) people are not interested in robots. They see robots as overly-complicated and unpractical. They want to be able to get around their house, take a bath, get to the toilet and that’s about it.

What do they want? Simpler, easier tools with big buttons and loud audio (Hey Apple, get the iPhone over here now). But seriously, the problem seems to be that Japan’s manufacturers simply don’t know what the market actually needs or wants. Reuters tells us:

Kitchenware maker Zojirushi Corp. offers the i-pot, an electric kettle equipped with a radio transmitter that sends e-mail twice a day to relatives to let them know if Grandma has made tea. Some 3,300 of the devices are in use across Japan.

That’s stupid. How could people sit in meetings and say, “That will sell” to each other? These products are still expensive and too difficult for elderly people to use. Also, it doesn’t help when their functionality is stupid to begin with.

Zojirushi, free advice: Find out what the market wants and build it for them. You’re not a particularly innovative firm, never have been, and you don’t need to be - nor do your customers expect it. Your products make hot water; by all accounts, Neanderthals pulled this one off. Make a pot with a huge button that says, “ON” and “OFF.” Hell, I’d buy it.

Another simple lesson: Keep products and services in tune with needs and desires.

Nikkei: Japan’s Twentysomethings Not Spending Like They Used To

On Wednesday, the Nikkei published its results of a survey concerning the spending habits of consumers in their 20s and 30s in Japan. The survey was done online in June and early July and received responses from 1,207 men and women in their 20s and 530 men and women in their 30s.

The results do not bode well for the future of consumer spending. According to the Nikkei, 13% of respondents in their 20s from the Tokyo area said they own a car, and only 25.3% said that they wanted to purchase one. When the same poll was conducted in 2000, the paper found that 23.6% of Tokyo residents in their 20s owned a vehicle, with 48.2% aspiring to purchase one.

29.6% of respondents in their 20s said that drinking was a waste of time, and 34.4% said they drink alcohol once a month or less. I remember a hip young marketer in Tokyo recently making an astute point that alcoholic beverages needed to be marketed in newer, fresher contexts in order to appeal to the younger market, who simply finds their products unappealing due to negative reinforcement. Perhaps what the industry needs is more along the lines of a miracle. I’d say the younger market might be catching on to what I would say about hard-earned disposable income: Don’t give it to companies whose business plan involves harming your health or quickening your death.

And that disposable income is increasingly harder-earned for young workers in Japan, who are more likely to be contract workers rather than regular employees. So what are they doing with that disposable income? The Nikkei tells us that although average disposable income was at 64,400 yen per month, up about 4,000 yen a month from 2000, 36% of those surveyed in their 20s said that they prefer to save their money rather than spend. This figure was up 8.2% from the 2000 survey.

Of course, we need to consider what kind of crowd in their 20s would be responding to an online Nikkei survey. We imagine that they might be professional job-holders in white collar positions. This might mean that we have more regular employees as a percentage of the group than the population at large, though I’m hoping to hear counter-arguments on this one.

However, if the group is indeed indicative of the views of Japan’s young professionals, we might assume that the population at large is spending less, since they would have slightly lower levels of disposable income.

Births Down, Deaths up in the First Half of 2007

Yesterday, the Ministry of Health, Labor and Welfare published statistics for the January-June 2007 period showing that last year’s increased birth rate has not yet taken root as a trend. In the first half of 2007, births in Japan fell 0.5% to 546,541. In June, 90,779 children were born, a decrease of 1.4% against the 92,047 children born in June of last year.

During the same half-year period, deaths in Japan rose 0.9% to 569,015. During the first half of last year, 564,082 deaths had been recorded in Japan. In June, deaths rose 1.1% to 83,093. Last June saw 82,223 deaths in Japan.

With deaths outnumbering births in the first half of the year, the population fell by 22,474.

The number of marriages also fell in the first half of 2007, from 367,965 to 359,925, for a 2.2% decline. On the plus side, the number of divorces also fell in the first half of 2007, from 136,128 last year to 133,776 this year. Although the number of divorces did rise in April and May, they had been lower in the first three months of the year, and fell off sharply in June.

In April, a new law allowed for divorced couples to split a husband’s public pension benefits. There has been no word from the government officially denying that the current crisis over missing pension payments was not simply an elaborate ruse intended to prevent the divorce rate from skyrocketing…

Japan headed for (natural or demographic) disaster? The economic consequences?

Those who watch Japanese movies may remember 日本以外全部沈没 (Everything Except Japan Destroyed), a B-grade film in which, well, everything except for Japan was destroyed.

This afternoon I noticed a few news reports expressing the opposite sentiment. Let’s start with a Cabinet Office report released on June 1st that warns of the challenges facing disaster prevention in Japan as more skyscrapers are built, shopping malls move underground, and the population continues to grey.

Earthquakes and storms threaten to do ever more damage to densely populated cities that are increasingly filled with high-rise office and residential towers. The number of buildings topping 100 meters has quadrupled over the past 15 years in Japan. At the same time, the report’s authors wonder if Japan’s current disaster response measures will be as effective when faced with a growing number of elderly who may be injured in the event of a natural disaster. According to the report, the number of single elderly households has nearly doubled over the last decade.

Further threatening Japan’s economy is the upcoming demographic crunch, which this observer still feels is going largely ignored by those in policy-making positions. In a recent article entitled “Japan leads world in demographic decline,” the Telegraph points out that although Japan is not alone in facing a future population decline, it shoulders the burden of being the trendsetter:

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