Finding Opportunities in Japan's Aging Population

Abstract

Japan’s transition into one of the world’s rapidly aging societies continues to be manifested in its declining population. With 26 percent of its population over the age of 65 in 2016, it has the highest share of senior citizens among the members of the Organisation for Economic Co-operation and Development (OECD), and is expected to expand into more than 30 percent in 2025. The shrinking population, attributed to the improving life expectancy of Japanese elderly and lower fertility rates, continues to hamper the country’s current efforts at raising productivity and revitalizing the economy. Its impact of a decreasing working-age population, in particular, would prolong Japan’s slow economic growth characterized by lower consumer spending and business activity.