I mentioned in a previous post that Japan isn’t alone in experiencing population decline, that is the proposed fifth stage of the demographic transition model. To briefly recap, stage 5 is the next proposed stage in the demographer’s framework of fertility in a society measured by the total fertility rate and the total death rate. Stage 4, “modernity” (if you will) is characterized by both fluctuating birth rates and low death rates. Birth rates fluctuate with things like economic busts/booms and war/peace dividends. Stage 5 is when birth rates fall below death rates, leading to a slowing of population growth (a deceleration). Eventually, population growth begins to decline if there’s no immigration (or net emigration, that is, people leaving) and birth rates don’t increase to replace the elderly who are dying.
I have amended my earlier post to account for some information. Japan wasn’t the first state to experience sustained population decline, while I don’t know who is first since I haven’t reviewed all of the data, I can say that Latvia was before Japan. Based on data from the U.S. Census International Program, Japan’s population was still growing in 2000, while Latvia’s had decreased. In 2013, Japan’s population had increased over the 2000 population figure from 126.7 million to 127.3 million. In Latvia over the same time the population had decreased from 2.3 million to 2.1 million. By 2050, demographic estimates forecast the population of Japan at 107.2 million and Latvia’s at 1.5 million. The situation is so dire in Latvia, that a Latvian demographer (as reported in The Baltic Times) predicted only 300,000 people would remain in Latvia by 2100.
Breaking down the rates behind these numbers, the number of births per 1,000 people in Japan is 8.2 while the number of deaths per 1,000 is 9.3 in 2013. The reflects a negative rate of natural increase, which is found by subtracting deaths from births and dividing by ten (or -0.11%). The net migration into Japan was negligible in 2013 so there is no effect from that activity on the population growth rate (which accounts for migration). In Latvia, births are 9.9 births per 1,000 people and deaths are 13.6 per 1,000, again suggesting a negative rate of natural increase (-0.37%). But, in addition, Latvia also loses 2.4 people per thousand persons in immigration. I discussed this briefly in a previous post on the uneven geography of minimum wages. Immigration bumps up this negative natural growth to -0.61% growth rate.
Looking into the future, Census estimates that immigration will increase in Latvia by 2050 while remaining negligible in Japan. In addition, birth rates are expected to fall further and death rates to spike dramatically. Why? The answer is the effect of population decline, barring any sort of short-term spike in births, in the relative proportions of the various age groups. As populations decrease naturally, there are fewer and fewer babies being born, meaning fewer potential children to be had. The children that are born are also less likely to have children meaning the situation will continue. On the other hand, the number of elderly increases in proportion to the number of children and middle-aged adults. With this larger number of elderly, the death rate looks like an increase but its really just the impact of having a “grey” population dying at the same rate. Essentially, the Census isn’t projecting a new disease or war will increase the death rate, just that a larger proportion of elderly will be dying off.
Consider the two population pyramids below for Japan (from the U.S. Census). The first is Japan male and female total population in 2000, the second is that total population in 2050. In 2000 the largest age groups are the 50-54 year olds and the 25-29 year olds. While the 50+ population is unlikely to have additional children, the population can conceivably still grow with the large numbers of youths, and as we saw above Japan’s population was still growing in 2000. Now consider the 2050 population pyramid. The two largest age groups are the 75-79 population group and the 70-74 population group. These groups are unlikely to have any additional children and to make it worse, there are fewer proportions of middle-aged adults and young adults to have children as well. Thus, barring any explosion in births population decline looks set to continue. The Latvian geographer bluntly said that Latvians would have to increase the natural birth rate to “African levels.”
The demographer suggests that the government should do more to promote the birth rate including raising subsidies for young families and improving access to kindergartens. Unlike some governmental programs and policies which see immediate results, building roads, raising taxes, and so on, demographic policies take decades to produce results. Therein lies part of the problem, in the world of democracies measured by four, five, or six year electoral cycles, two-decade demographic plans are absent (or not discussed). Partly because each new government stops the policies of the outgoing government or funds different programs.
The potential economic impact of population decline is clear in the Japan 2050 population pyramid. Like developing economies today, these stage 5 economies will have too many dependents to support. In developing economies, the “youth bulge” burdens working adults with having to economically support large numbers of children either at home or through the state, limiting savings and consumerism. The situation would be similar in stage 5 economies when working adults must help support the “elderly bulge” either directly, by having parents and grandparents stay at home, or indirectly, by paying heavy taxes to care for them.