The Abe Cabinet has endorsed a long-term vision for Japan’s population and a five-year comprehensive strategy starting with fiscal 2015 to help revitalize the nation’s regional economies, a major pillar of the Liberal Democratic Party’s campaign promise for the Lower House election last month.
Given Japan’s dwindling and graying population, this is a task that cannot be avoided.
It would not be realistic to expect the task to be accomplished quickly, but it is important for both the central and local governments to take effective steps promptly, because the aging and dwindling of the population are especially rapid in rural parts of Japan.
As Prime Minister Shinzo Abe said, the central government should not spare funding and other resources in helping local governments in their efforts to reignite their economies.
The national government has a target of stabilizing Japan’s population at around 100 million in 2060. It estimates that the goal would be achievable if the total fertility rate — or the number of children on average that a woman gives birth to in her lifetime — rises from the 1.43 in 2013 to 1.8 in 2030 and to 2.7 in 2040. To achieve that, the government needs to pursue policies that will contribute to stabilizing employment for young people and enhance measures to support young working parents, including improving the availability of day care centers for children. These steps would be crucial to encourage the younger generation to have and raise children.
It is estimated that if the total fertility rate goes up as planned, the percentage of the elderly people aged 65 years or older in the total population will peak at 35.3 percent in 2050 and will come down to 26.6 percent in 2110 — slightly more than the rate of 23 percent in 2010.
But one wonders whether the Abe administration’s policy, which is inclined toward increasing the number of irregular workers — as exemplified by the effort to remove the cap on the period in which companies can continue to hire dispatched workers — will be conducive to securing and stabilizing employment for young people.
There seems to be a basic discrepancy between the administration’s general direction in its employment policy and what its regional revitalization program aims at.
Both the long-term vision of the population and the five-year-strategy call for reducing the concentration of Japan’s population in the greater Tokyo area. It is a reasonable goal from the viewpoint of revitalizing economic, cultural and other activities outside urban areas.
The strategy calls for reducing projected domestic emigration to Tokyo and Saitama, Chiba and Kanagawa prefectures by 60,000 and increasing the exodus out of the area by 40,000 in 2020 from 2013 levels, so that the people moving in will balance out those moving out. Each movement would number some 410,000 in 2020, the year of the Tokyo Olympics.
The key to the success of this policy would be whether regions other than the Tokyo metropolitan area can offer attractive job and education opportunities in adequate numbers. Otherwise, the goal will be a pie in the sky.
To prevent population concentration in the greater Tokyo area, the strategy embraces a numerical target — creating jobs for 300,000 people in the age bracket of 16 to 34 in other parts of Japan over five years through 2020. It also envisages reducing the number of “freeters” — young people who move from one low-paying job to another — by 580,000 from the 2013 level to 1.24 million in 2020, the year of the Tokyo Olympics.
One problem with the target of creating 300,000 jobs in areas outside of Tokyo is that it is unclear how the goal is connected with the policy of creating 50,000 jobs in agriculture, forestry and fisheries businesses through efforts to turn these sectors into growth industries.
The tourism industry is expected to create 80,000 jobs, but that sector could be beset by unstable factors such as natural disasters and a higher yen as well as diplomatic rows that discourage foreign tourists from visiting Japan.
A bigger problem is that the Abe administration appears to have bundled together measures pushed separately by different government ministries. The administration needs to monitor the progress of each measure and coordinate the various steps from an overall viewpoint, allowing the strategy to evolve as it moves forward.
Other measures called for by the strategy include tax privileges for companies that move their headquarters outside of the greater Tokyo area, relocation of government offices, establishment of easy-to-use scholarships for university students in other parts of the country and provision of new grants to local governments that can be used flexibly as needed.
In fiscal 2015, local governments are required to work out their own revitalization plans in accordance with the national government’s strategy.
The effects of these policies will be reviewed and the national government will then differentiate the amounts of grants to each of the local governments on the basis of the results in an attempt to spur competition among the prefectures and municipalities.
But given that each local government faces different sets of problems, one wonders what would be the rationale for differentiating the grant amounts, even though wasteful use of the grants should be restrained.
Although the strategy has its problems, local governments bear the responsibility all the same for developing revitalization policies that fit their specific needs. The national government should not leave that task completely to local governments; it should proactively assist them by offering its knowledge, ideas and resources.
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