Demographic Changes and Life Insurance Business in Japan--- Series 1: What Happened and Why ---Japan’s population kept growing from 1900s to 2008. It exceeded 100 million
for the first time in 1967. This upward trend, however, ended after reached its
peak about 128 million in 2008. Since then, Japan has been experiencing arapid population decline. The latest data from 2015 Census predicted thatJapan’s population stands at 127.1
million, a 0.7 percent decline from2010 Census.
Japan’s fertility rate had been athigh levels during the period from1947 to 1949 and the period from1971 to 1974, which are known as
the first baby boom and the secondboom of post-war Japan. After thesecond baby boom, the fertility rate
shifted to a decline trend. It fell below
1.5 at the beginning of the 1990s andto a new record in 2005 about 1.29.
As a consequence, the working age
population has been on a downward
trend after reached its peak in 1997
as well.
On the other hand, the proportion
ofpopulation

aged

over65

isincreasing rapidly. The 2015 Census

1shows that the number of elderlypeople has risen to a new record of about 33.8 million, or 26.7 percent of thepopulation, while the number of people aged over 80 has risen to over 10
million for the first time as well. Inaddition, according to the forecastby the United Nations, Japan’s
population will fall to about 83
million,andtheproportionofpeople aged over 65 will rise to 35
percent by 2100.
The increase in the number of
elderly population can be largely attributed to the improvement in living
standards and development of medical technology. In contrast, the causes oflow fertility rate in Japan seem more complicated. Some scholars argue thatthe decline in the infant mortality rate could result in a decrease in the numberof children that a couple wants to have. This argument is especially evident
during the prewar period. Moreover, the industrialization is also considered asa factor responsible for the decline in the number of children that a couplewants to have. For instance, in the agrarian society, a couple may want to havemore children as potential labor force. On the contrary, in an industrial society,such needs will become weaker. However, thetotal number of newborn during the prewar
period was on an upward trend despite thatnoaccurate

dataonfertility

rate

areavailable.
In general, progress in women’s social
advancement associated with improvement
in women’s education and development ofeconomy is considered as an important factor responsible for low fertility rate

having their first child in their 30s. Moreover, it is said that the continuing

2in postwar Japan. It generated a trend toward later marriage and motherstraditional disapproval of out-of-wedlock births is also a factor responsible forlow fertility rate.
Furthermore, high cost of raising a child associated with improvement inliving standards and economic development can be considered as a possible
cause of low fertility rate, giving the fact that the metropolitan population has
been steadily growing since the high-growth period of Japanese economy. In
addition, indirect cost of having and/or raising a child could be significant
when women think they will lose out in the competition for promotion if theytake time to have babies. Moreover, increase in number of unmarried young
adults is also responsible for low fertility rate in Japan.

To be continued…

3

YingYing Jiang, Ph.D. in Commerce of Hitotsubashi University.