Health and Healthcare Systems

More than 1 in 10 people in Japan are aged 80 or over. Here's how its ageing population is reshaping the country

Japan's ageing population has implications for its economy and workforce.

Japan's ageing population has implications for its economy and workforce. Image: REUTERS/Issei Kato

Charlotte Edmond
Senior Writer, Forum Agenda
Madeleine North
Senior Writer, Forum Agenda
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Japan

This article was published in September 2019 and updated in September 2023.

  • More than 1 in 10 people in Japan are now aged 80 or older, and the country consistently rates as having the world's oldest population.
  • This is having a profound impact on Japan's economy, workforce and society.
  • The World Economic Forum's Future of Jobs Report 2023 finds that only 35% of companies prioritize workers aged over 55.

Japan is getting ever greyer. More than 1 in 10 people in the country are now aged 80 or older, according to the latest national data. Almost a third of its population is over 65 – an estimated 36.23 million. And there are more people than ever blowing out 100 birthday candles.

Japan consistently has the oldest population in the world – with significantly more people over the age of 65 than Italy, the next oldest country.

Graph showing top 5 countries with the largest share of people aged 65 years of over
Japan consistently has the oldest population in the world. Image: UN

Impact of ageing population on Japan

The global shift towards a more elderly demographic is a transformation that is already shaping government policies and affecting societies and economies around the world. Here’s how its impacts are being felt in Japan.

1. Economy

In 2020, the International Monetary Fund predicted that "the ageing and shrinking population will strain Japan’s public finances, as age-related spending – such as on healthcare and pensions – rises while the tax base shrinks”.

It's true that Japan's GDP hasn't exactly flourished in recent years, but as Deloitte reports, the country "continues to post economic gains", albeit small ones, and remains the second-largest economy of the G7 countries, with GDP of around $4.2 trillion, as the chart below shows.

That said, Prime Minister Fumio Kishida said in January 2023 that "Japan is standing on the verge of whether we can continue to function as a society," facing as it does the twin threats of falling birth rates and an ever-increasing elderly population.

Graphic showing GDP of G7 countries from 2000 to 2023
Despite its ageing population, Japan still has the second-largest GDP of the G7 countries. Image: Statista/IMF
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2. Productivity

Japan is already facing a labour shortage, and by 2040 it could be short of 11 million workers, a recent study found. This led it to introduce the Guideline of Measures for Ageing Society in 2018, to encourage older people to continue in the workforce.

In 2022, almost half of Japanese firms relied on workers over the age of 70. Globally, meanwhile, only 35% of companies prioritize workers aged over 55, according to the World Economic Forum's Future of Jobs Report 2023.

With technology and digitalization also in the mix, Prime Minister Kishida pledged $7.6 billion earlier this year to train workers for more high-skilled jobs in the next five years, reports The Japan Times. But some experts say that, without relaxing the country's strict immigration laws, filling that labour gap will be a slow burn.

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3. Society

Japan's birth rate hit a record low in 2022. The fertility rate was 1.2565, far below the rate of 2.07 considered necessary to maintain a stable population, reports Reuters.

The pandemic only exacerbated Japan's demographic challenges, leading not just to more deaths, but also to fewer marriages and births.

This is a ticking time bomb for Japan’s social security system, which is struggling to meet the costs of a retired population with fewer workers paying taxes.

4. Health

Given Japan's ageing population, healthcare is an inevitable crunch point.

Promoting a move from hospitals to home is one way the government has been trying to tackle the problem, encouraging patient-requested care, self-medication and remote monitoring of patients in their homes.

Carebots to assist the elderly have also been trialled for several years, but automating care has not turned out to be the panacea Japan hoped for.

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