Shrinking population and its consequences in Japan: social security, regional disparity, and ethnic diversity SEMINAR ON POPULATION PROJECTIONS AND DEMOGRAPHIC TRENDS 2018 November 13, 2018 Yu Korekawa National Institute of Population and Social Security Research, Tokyo, Japan
Contents 1. Objective 2. Overview of the Official Population Projection of Japan Summary of Results Assumptions (Fertility, Mortality, and Migration) 3. Consequences of Shrinking Population Stagnated Economy? Regional Disparity Ethnic Diversity 4. Discussion 2
1.Objective Question: Japan is now under population decline, but how will it be? How fast, and how large will it be? As a result, what will happen? To reveal them, we should see 1. inside of the official population projection of Japan in 2017, 2. results of the projection 3. and, possible consequences of shrinking population. 3
2. Overview of the Official Population Projection of Japan Framework Released Date: April, 2017 Projection Period: 2016-2065 (50 years) Coverage: Total Population (Japanese and foreign citizen) Sub-population: Sex, Age (0-104 and +105 years old), Japanese and Foreign Citizen Base Population: Total Population as of Oct. 1 st, 2015 (Population Census of Japan) Cycle: Every 5 years (a year later the population census) Method: Cohort-Component Method 4
Fertility Assumptions Type of assumption Medium-variant assumption High-variant assumption Low-variant assumption Fertility assumption index Current statistic value, women born in 1964 Assumption Assumption, women born in 2000 (reference cohort) (1) Mean age at first marriage 26.3 years old 28.6 years old (2) Proportion of never married 12.0% 18.8% (3) Completed number of births from married couples (4) Coefficient of divorce, bereavement, and remarriage 1.96 children 1.79 children 0.959 0.955 (1) Mean age at first marriage 28.2 years old Statistics in 2015 Total fertility rate Projection in 2012 Progression 2065 2060 Maximum value 1.45 1.45 1.44 1.35 Minimum value 1.42 Maximum value (2) Proportion of never married 13.2% Same as above 1.45 1.66 1.65 1.60 (3) Completed number of births from married couples (4) Coefficient of divorce, bereavement, and remarriage Minimum value 1.45 Maximum value (2) Proportion of never married 24.7% Same as above 1.45 1.45 1.25 1.12 (3) Completed number of births from married couples 1.91 children 0.955 (1) Mean age at first marriage 29.0 years old (4) Coefficient of divorce, bereavement, and remarriage Table 1: Summary of Fertility Assumptions 1.68 children 2015 2024 2024 2015 Minimum value Sex ratio at birth: The average value of the sex ratio at birth (105.2) from 2011 to 2015 is assumed to remain constant onward. 0.955 注 ) 標本調査を含む実績値と人口動態統計にもとづく実績値との乖離を調整する係数を乗じた 調整済み離死別再婚効果は以下の通りである 1964 年コーホート : 0.945 2000 年コーホート :0.960 2015 2024 1.20 Total fertility rate 2.5 2.0 1.5 1.0 0.5 Actual 0.0 1965 1975 1985 1995 2005 2015 2025 2035 2045 2055 2065 Year Note: Previous projections are shown in broken lines Projected 5 High- variant Medium- variant Low- variant Figure 1: Trends of the total fertility rate: Medium-, high-, and low-variant projections
Mortality Assumptions 95 90 85 Female Medium- variant Medium- variant High- variant Low- variant High- variant Table 2: Trends of life expectancy: Medium-, high-, and low-variant projections 2015 2065 life expectancy (years) 80 75 Male Low- variant Note: Previous projections are shown in broken lines Low M80.75,F86.98 M86.05,F92.48 Medium M80.75,F86.98 M84.95,F91.35 High M80.75,F86.98 M83.83,F90.21 70 Actual Projected 65 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 2055 2060 2065 Year Figure 2:Trends of life expectancy: Medium-, high-, and low-variant projections 6
Migration Assumption 0.003 100 Immigration rate 0.002 0.001 0.000-0.001-0.002-0.003-0.004 Male Female Number of net migrants (thousands) 80 60 40 20 0-20 -40 Proportion of men among net migrants of non-japanese origin:48.9% Projected 69,235-0.005 0 10 20 30 40 50 60 70 80 90 Age -60 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 Year Figure 3-1: Age-specific net international migration rates by sex for Japanese Figure 3-2: Number of net migrants of non-japanese origin (both sexes) 7
Summary of Results Total Population Table 3: Summary of the Population Projection for Japan 2017 Medium Fertility Variant [1.44] High Fertility Variant [1.65] Medium Mortality Variant [Male 84.95 years old] [Female 91.35 years old] 2015 127.09 m 127.09 m 127.09 m 2040 110.92 m 113.74 m 108.33 m 2065 88.08 m 94.90 m 82.13 m Low Fertility Variant [1.25] Old Age Population 2015 33.87m, 26.6% 33.87m, 26.6% 33.87m, 26.6% 2040 39.21m, 35.3% 39.21m, 34.5% 39.21m, 36.2% 2065 33.81m, 38.4% 33.81m, 35.6% 33.81m, 41.2% Source: Population Projection for Japan 2017 8
Summary of Results (Cont d) (Thousands) 140,000 (%) 50 120,000 100,000 (Fertility assumption) High-variant 45 40 35 Note: Previous projections are shown in broken lines (Fertility assumption) Low-variant Medium-variant High-variant 80,000 Medium-variant Low-variant 30 60,000 Note: Previous projections are shown in broken lines 25 20 40,000 15 20,000 Actual Projected 10 5 Actual Projected 0 1965 1975 1985 1995 2005 2015 2025 2035 2045 2055 2065 Year Figure 4-1: Actual and projected population of Japan: Medium-, high-, and low-fertility (medium-mortality) projections 0 1965 1975 1985 1995 2005 2015 2025 2035 2045 2055 2065 Year Figure 4-2: Trends in the proportion of elderly (aged 65 and over): Medium-, high-, and low-fertility (medium-mortality) projections 9
Summary of Results (Cont d) (1) 2015 (3) 2065 Males 男性 100 Females 女性 Males 男性 100 Females 女性 90 90 Old-age population (aged 65 and over) 80 70 60 80 70 60 Working-age population (15-64) 50 40 30 50 40 30 Young-age population (aged under 15) 20 10 0 130 120 110 100 90 80 70 60 50 40 30 20 10 0 0 10 20 30 40 50 60 70 80 90 100 110 120 130 (ten 人 口 thousand) ( 万 人 ) 20 10 High fertility variant projection Medium fertility variant projection Low fertility variant projection 0 130 120 110 100 90 80 70 60 50 40 30 20 10 0 0 10 20 30 40 50 60 70 80 90 100 110 120 130 人 口 (ten( thousand) 万 人 ) Figure 5: Population pyramid: Three fertility variant projections (Medium Mortality) 10
2. Consequences of Shrinking Population - Stagnated Economy? 90.0 85.0 80.0 75.0 70.0 65.0 60.0 55.0 50.0 45.0 40.0 Low, 81.5 Medium, 74.6 High, 68.3 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 2037 2039 2041 2043 2045 2047 2049 2051 2053 2055 2057 2059 2061 2063 2065 Replacement Ratio of the Standard Pension (Medium Assumptions) 2014: 62.7%, 2019: 60.3%, 2030: 57.2%, 2044:50.9%, 2050: 50.9% Mid-term Economic Outlook (GDP, Real) 2018: 1.5% 2027: 1.1-2.0% Government Fiscal Deficit (Stock, % to GDP) 2018: 189.2% 2027: 157.1% - 179.8% Figure 6: Projection of Old-age Dependency Ratio (Elderly People per 100 Working-Age People) Source : MHLW 2015, Cabinet Office2018a,b 11
3. Consequences of Shrinking Population - Regional Disparity - 70 70-80 80-90 90-100 100-500 250 0 500 km Figure 7: Population Size in 2045, Compared to the 2015 Size(2015=100), Prefectures Source: Koike 2018 12
3. Consequences of Shrinking Population - Ethnic Diversity Third Demographic Transition (Coleman 2006) a third demographic transition is underway in Europe and the United States. The ancestry of some national populations is being radically and permanently altered by high levels of immigration of persons from remote geographic origins or with distinctive ethnic and racial ancestry, in combination with persistent sub-replacement fertility and accelerated levels of emigration of the domestic population. Ethnic Diversity from the Bottom (Lichter 2013) Diversity begins with children from the bottom up. Over the next generation or two, an older, largely white and affluent population will be increasingly replaced by today s disproportionately poor minority children, who will reshape America s future and its place in a globalizing economy. Japan has experienced a migration transition in the 1990s, and it will also face a big change of ethnic diversity.(korekawa 2018) 2.6% of the total population is those with migrantbackground in 2015. 12.0% of the total population (more than 10 millions) will be those with migrant-background in 2065. Proportion to the Total Population(%) Age 20.0% 18.0% 16.0% 14.0% 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 120 110 100 90 2015 2020 0-19 20-44 45-64 65-74 75+ All Age Groups 2025 2030 (Male) Foreign Citizens Naturalized Immigrants International Children 2035 (Female) 80 70 60 50 40 30 20 10 0 (100) (50) 0 50 100 Population Thousand 2040 Year Figure 8: Projected Proportion of Population with Immigrant Background 2015-65 Source: Korekawa 2018 Figure 9: Projected Proportion of Population with Immigrant Background 2065 Source: 13 Korekawa 2018 2045 2050 2055 2060 2065
Overview of the History, a Long-term View (Thousand) 3,000 2,500 1936, 2,670 Japanese Expatriates Foreign Citizens (Colonial Origin) Foreign Citizens (Not Colonial Origin) 2,232 2,000 1,500 1,000 Annexation of Korea (1910) Reform Act of Immigration and Refugee Immigration Control Control Act Order (82) (51) Reform Act of ICRRA 1940, 1,304 (90) Liberalization of Traveling Overseas (64) 1,352 The End of W.W.2 (45) 500 330 0 1875 1880 1885 1890 1895 1900 1905 1910 1915 1920 1925 1930 1935 1940 1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 Source: Various Materials Figure 11: Trends of International Migration of Japan 14
A Recent Trend: Chinese Led the transition, and more diversity has come about 900,000 800,000 Registered Foreign citizens 700,000 600,000 500,000 400,000 300,000 200,000 100,000 South/North Korea Old-Comer Korean New-Comer Korean China Philippines Other Asia Brazil 0 1947 1949 1951 1953 1955 1957 1959 1961 1963 1965 1967 1969 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2016 Source: The Registration Data on Foreign Citizens Figure 12: The Trends of International Migration of Japan, by Nationality 15
A Recent Trend: From Family-based to Economic Immigrants 400,000 350,000 300,000 Family(Accompanying Family) Family(A Spouse of JP) Japanese Descendents 400,000 350,000 300,000 Student Work(Entertainer/Cook) Industrial Trainee Intre-compnay Transferee High Skilled Registered Foreigner 250,000 200,000 150,000 Registered Foreigner 250,000 200,000 150,000 100,000 100,000 50,000 0 1959 1964 1969 1974 1984 1986 1988 1990 1992 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 50,000 0 1959 1964 1969 1974 1984 1986 1988 1990 1992 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Note: Japanese descendants consist of Brazilian and Peruvian nationals who have either of a spouse of a Japanese national, resident or permanent resident visa. A spouse of Japanese national excludes Japanese descendants. Source: The Registration Data on Foreign Citizens Figure 13: The Trends of International Migration of Japan, by VISA status 16
A Recent Trend: From Family-based to Economic Immigrants Unit Thusand 250 200 150 100 Industrial Trainee Japanese Descendants Work (Other) Spouse of JP Accompanying Family Student High Skilled 50 0-50 -100-150 1964 1969 1974 1984 1986 1988 1990 1992 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Note: Japanese descendants consist of Brazilian and Peruvian nationals who have either of a spouse of a Japanese national, resident or permanent resident visa. A spouse of Japanese national excludes Japanese descendants. Source: The Registration Data on Foreign Citizens Figure 14: Contribution to Annual Net Increase of Immigrants, by VISA status 17
Major Policy Developments 1952 The enforcement of the Immigration Control Ordinance 1982 The 1 st reform of the Immigration Control and Refugee Recognition Act (ICRRA) The creation of a visa category for industrial trainee 1989 The 2 nd reform of ICRRA (enforced in 1990) - new creations of working VISAs, a new pathway to permanent VISA - the beginning of the Post 1990 immigrants era 1993 The establishment of Technical Intern Training Program (TITP) 2012 The enforcement of the Point-based System for Highly Skilled Foreign Professionals 2016 The 3 rd reform of ICRRA (the creation of a new visa category for a care worker) 2017 Beginning of Working of Foreign Maids in Tokyo, Hyogo, Osaka, Kanagawa prefecture Shortening a residence criterion for Permanent Visa from 5 to 1 year 2018 Amendments of ICRRA is now being under discussed at the national Diet session, which will start to accept low- to middle-skilled foreign labor from the NEXT April. 18
A Migration Transition; a Japanese case Japan experienced the migration transition in 1997, in terms of the balance between the number of immigrants and that of Japanese expatriates. Behind the transition, there has been a perpetual high demand for labor force, especially unskilled labors. The 1990 reform of ICRRA led the transition, but the reform was not necessarily proactive but rather reactive to the situation at that time. At the beginning, the transition was led by the family-based migrants, such as Japanese descendants from south American countries, or marriage migrants from Asian countries. Since the late 2000s, economic migrants such as international students, highly skilled professionals, and technical intern trainees are leading the transition, as the number of the family-based migrants are declining. The diversity of migrants country of origin is growing after 2010. 19
A Future Prospect Hypothesis: Japanese society will experience a huge social and demographic change by the migration transition now and in the near future. Questions: 1. How large is the immigrant population in Japan now, including children from international marriages, and naturalized immigrants. 2. How will the immigrant population be in the mid- to long-term? 3. How will the social and demographic change be, compared to other developed countries? 20
Data: A Methodology and Data Base Population: the Population Census of Japan in 2015 (Japanese Statistical Bureau 2016) 127,095 thousands (the total population) Fertility: the population projection of Japan, 2017 (IPSS 2017) TFR 1.45 (2015) 1.44 (2065) (for Japanese citizens) TFR 1.10 (2015) 1.19 (2065) (for population with migrant background) Mortality: the population projection of Japan, 2017 (ibid) 80.75 years (male, 2015) 84.95 years (male, 2065) (for both non-native, and Japanese) 86.98 years (female, 2015) 91.35 years (female, 2065) (for population with migrant background) International Migration for Japanese: the population projection of Japan, 2017 (ibid) International Migration for Foreign Citizens: New Assumptions for the present study Methodology: A cohort-component method for the future population, which is same as the methodology of the population projection of Japan, 2017 An estimation of the current non-native population from the past number of international children and that of naturalizations, which are also adjusted with fertility and mortality (no migration). 21
Definitions of Terms Definitions of population with migrant-backgrounds: 1. Foreign Citizen: a person who have a citizenship other than Japanese except industrial trainees 2,015,495 foreign citizens (as of 2015) 2. International Child: a child who have at least one immigrant parent 28,787 births/year (the average since 1987) 3. Naturalized person: a person who is naturalized to Japan 13,097 naturalizations/year (the average since 198 22
Assumptions on International Migration Net Migration of Foreign Citizens 150,000 100,000 50,000 0-50,000-100,000 1967 1969 1971 1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2035 Year Source: Estimated by author Figure 15: Fitting of Logistics Curve to Net Migration of Foreign Citizens The assumption on international migration of foreign citizens is obtained by fitting logistics curve to the past net migration of foreign citizens, and extrapolating it to the future until 2035. The level of net migration rises from 89,797in 2016 to 98,733 in 2035. After 2036, the migration rate to the total population by each age and sex group is fixed and kept constant to until 2065. 23
A Size of Population, 2015 Age 120 110 100 90 80 70 60 50 (Male) (Female) Foreign Citizens Naturalized Immigrants International Children 40 30 20 10 0 (100) (50) 0 50 100 Population Thousand Source: Estimated by author Figure 16: The Estimation of the Non-native Population, 2015 Total Population, 2015 Foreign Citizen 2,015,495 Naturalized Immigrants 462,737 International Children 847,173 Non-native Total 3,325,405 (2.6% of the total population) Reference Foreign Citizens by the population census of Japan 1,775,446 (1.4% of the total population) 24
A Future Prospect, 2040 Age 120 (Male) (Female) 110 Foreign Citizens 100 Naturalized Immigrants 90 International Children 80 70 60 50 40 30 20 10 0 (100) (50) 0 50 100 Population Thousand Source: Estimated by author Figure 17: The Estimation of the Non-native Population, 2040 Total Non-Native Population, 2040 Foreign Citizen 4,228,975 Naturalized Immigrants 1,000,265 International Children 2,031,492 Non-native Total 7,260,732 (6.5% of the total population) Total Population of Japan, 2040 111,938,432 (the present study) 110,919,000 (the official projection) Difference = 1,019,432 (+0.92%) 25
A Future Prospect, 2065 Age 120 110 100 90 (Male) (Female) Foreign Citizens Naturalized Immigrants International Children 80 70 60 50 40 30 20 10 0 (100) (50) 0 50 100 Population Thousand Source: Estimated by author Figure 18: The Estimation of the Non-native Population, 2065 Total Population, 2065 Foreign Citizen 5,623,167 Naturalized Immigrants 1,648,095 International Children 3,485,462 Non-native Total 10,756,724 (12.0% of the total population) Total Population of Japan, 2065 89,898,589 (the present study) 88,077,000 (the official projection) Difference = 1,821,589 (+2.07%) 26
A Future Prospect, Diversity from the Bottom Proportion to the Total Population(%) 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 2015 5.8% 5.7% 4.8% 3.8% International Children Naturalized Immigrants Foreign Citizens 1.9% 0.7% 0.4% 2.6% 0-5 0-9 0-19 20-44 45-64 65-74 75+ Total Age Group Proportion to the Total Population(%) 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 10.3% 9.5% 7.6% 9.1% Foreign Citizens Naturalized Immigrants International Children 2.9% 1.8% 0.8% 0-5 0-9 0-19 20-44 45-64 65-74 75+ Total Age Group Figure 19: The Estimation of the proportion of non-native population to the total population of Japan 2030 27 4.7% Source: Estimated by author
A Future Prospect: International Comparison Table 4: Projected Proportions of Population with Migrant-background 2015 2065 US 22.5% 56.4% UK 16.6% 39.5% Germany 17.8% 45.1% France 15.8% 21.8% Italy 12.7% 40.1% Japan 2.6% 12.0% Note: Figures for UK, Germany, France, and Italy cover foreign citizens, undocumented, and the second and later generations of immigrant-origin. Figures for European countries are those in 2011, and 2061 respectively. Figures for US are for population of other than non-hispanic White in 2014, and 2060 respectively. Source: Lanzieri (2011), Colby, Sandra L. and Jennifer M. Ortman, 2014 and estimated by author 28
4.Discussion 1. Japan is now under population decline, due to low fertility and longer longevity, which will not change in the mid- to long-term. 2. Expected consequences will be economic stagnation, due to high financial burden for social security, and negative economic prospect as a result of it. 3. Regional disparity of population decline will be the third pillar of the population decline. 4. More ethnic diversity will be a hidden issue in near future. Low-fertility among native Japanese women, and constant inflow of immigrants will change the ethnic composition gradually. 5. How should we cope with population decline? One possible answer would be a migration policy. Recently, the Japanese government has took several policies to open its labor market to foreign workers, and high-skilled professionals. The net inflow of foreign citizens was 179,000 in 2017, which is a record high in the past decades. Additionally, a new policy to enhance foreign labors is under discussion. 29
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