Experts say Japan must change how it is handling low birthrate

by Mariko Kato

The government has been grappling with a low birthrate for 20 years, but experts say the Hatoyama administration must step up the game if Japan is to maintain a leading role on the international stage.

The nation is falling behind other developed countries in encouraging women to have children by helping them combine work and child-rearing, according to observers.

Experts say the low birthrate will reduce the working-age population, leading to a decline in production and economic growth. This in turn will make Japan less competitive in the global economy, they say.

“The declining birthrate will dramatically affect Japanese society in 20, 30 years and Japan will lose its international presence,” said Makoto Atoh, a human sciences professor specializing in population and issues related to declining birthrates at Waseda University in Tokyo.

“Japan will have to bear in mind that its position will change from a great power to a shrinking nation when (engaged in) international relations,” Atoh said.

He pointed to development aid as an area in which Japan may lose its global leadership.

Japan’s total fertility rate — the number of children a woman would bear throughout her life if she follows the age-specific fertility rates of a given year — fell to 1.57 in 1989 and went into a general decline. It reached an all-time low of 1.26 in 2005, according to the Health, Labor and Welfare Ministry.

Despite slight increases in recent years, it was still at only 1.37 in 2008, far below 2.1, the accepted rate at which developed countries can sustain a stabilized population.

The National Institute of Population and Social Security Research says the population will shrink by a third by 2050, and by 2105 it will fall to 44.6 million. People of working age between 15 and 64 will make up only half of the population by 2055, the research center projects.

Indeed, many Japanese companies have already started shifting their market focus overseas, given the expected shrinkage of the domestic market.

Beverage giants Kirin Holding Co. and Suntory Holding Ltd. announced plans last year to merge, citing the shrinking domestic market as one reason to integrate.

According to experts, most industrialized countries are dealing with low birthrates because an advanced economy triggers an increase in child-rearing expenses.

“Under the social and economic systems of developed countries, the cost of a child outweighs (the child’s) usefulness,” said Toru Suzuki, senior researcher at the National Institute of Population and Social Security Research.

“As the economy grows more sophisticated, the skills needed of a worker become more developed and varied, and the demand for investment in education increases. And in a society where the scholarship system is not developed and parents are conservative toward their children, the rising child-related costs suppress the birthrate.”

Suzuki added that if the economy has matured and is not growing, employment opportunities drop for young people who then become less inclined to marry or to have children. In the case of Japan, the problem was exacerbated by the recession in the 1990s, experts say.

According to Atoh, the reasons for the declining birthrate in all countries are rooted in economic diversification, which creates greater demand for women to work.

But each nation has handled the problem with varying degrees of effectiveness, with successful countries helping women balance work and child-rearing both socially and politically, he said.

“In France and Northern European countries such as Sweden, they have spent a lot of money on establishing support for child-rearing, on top of providing financial help for families,” he said.

In Japan, while it is encouraging that the administration led by the Prime Minister Yukio Hatoyama’s Democratic Party of Japan is putting child-rearing policies high on its agenda, too much focus has been placed on distributing cash to households and not enough on providing a supportive environment for working mothers, according to Atoh.

“They’ve been talking about the need to increase the number of child care centers, but they haven’t set aside specific funding,” he said.

He added that Japan is only spending a quarter of what countries such as Sweden are paying on support for children and families, in terms of percentage of gross domestic product.

The DPJ played up child-rearing support in August’s election, pledging to hand out ¥26,000 per child per month. Meanwhile, the number of children who can’t get into child care has not declined significantly in recent years, with 25,384 on waiting lists last April, according to the welfare ministry.

Experts point to Germany as a country that has dealt with a falling birthrate in similar circumstances to Japan but is one step ahead in resolving the issue.

In 2007, the German government pledged to triple the number of nursery schools by 2013 and introduced a support system in which parents who stay home with a child receive 67 percent of his or her current income.

That year, Germany’s total fertility rate was 1.4, according to U.N. statistics.

“For a long time Germany was similar to Japan, or rather, it was an example of how not to behave,” Atoh said.

“It was spending a lot of money on tackling the declining birthrate, more than Japan, but they focused on giving financial support, not on supporting women’s work-home balance and they were hardly building any child care centers,” he said.

A policy overhaul was held back in Germany by the idea that children should be looked after by their mothers, and women could only place their children in care after they had reached the age of 3, by which time the mothers could not realistically go back to work, according to Atoh.

This traditional family ideal is what is preventing other developed countries, mainly in Southern Europe and East Asia, from handling their low birthrates effectively, he said.

Suzuki agrees that Japan must modernize its social attitude toward marriage and children, referring to France as a leading example.

“France has a higher rate of births outside marriage, children become independent earlier, and there is a higher rate of use of child care services for infants,” he said, adding that France also offsets its falling birthrate with a more welcoming immigration policy.

France’s total fertility rate in 2007 was an encouraging 1.9, according to U.N. figures.

If Japan’s population decreases and ages over the next few decades, the nation will suffer domestically as well as on the international stage, experts say.

“Population in the farming and rural areas will become sparse and age dramatically and communities will break down, followed by the rest of Japan,” Atoh said.

A reduced workforce will also affect priorities in services, according to Suzuki.

“Both workforces and funds will go to sectors such as medical care and care for the elderly,” he said.

Atoh agrees that a reduced working-age population will mean the quality of public services will suffer.

“The standard of what the government and society can do will fall, which will mean more burden on the individual. The minimum safety net will be lost, and the disparity of living standards will increase,” he said.