Saturday, June 03, 2006

Increasing Aged People: A Constant Threat to Japanese Economy

Japanese government released a white paper on Friday which contains a warning to the Japanese economy. It stated that right now 20% people are aged 65 or above in Japan. Among the total working population 5.04 million are aged 65 or older which stands 7.6 percent of the total working population, an increase of 0.2 point from lat year. It predicts that a decline in the Japanese workforce will be started from 2007 as the postwar generation will be going to their retirement age.

The white paper focused on the rapid increase among the aged group of people. It indicates the group of people aged 65 or above estimated 25.6 million in October 1, 2005 which is 20.04 percent of total population, an increase of 720,000 people and 0.54 percent from a year before. It is also predicted that the percentage of elderly people would be 26.o percent by 2015.

To avert a lacking of working people in the workforce in the coming years, Japan government is planning to redefine the age segment of elderly people making it 70 instead of existing 65 so that government can use the experience, skill and service of senior citizens of the country in the workforce for five years more.

In this way government may be able to hold the problem to their economy for some years but it can not be a permanent solution. So, besides these initiatives government has to ensure the increase in the fertility rate among the Japanese as fertility rate has seen a huge fall in the recent years. I hope that Japanese think tanks will be able to figure out some way to get out of this problem.



Japanese Business Etiquette said...

Yes, Japan, just like Germany, is aging! Changing demographic like this will probably have huge implications for such countries as we go into the 21st century.

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