Rural Japan is rapidly depopulating – what will solve the labour shortage?

It is well-known that the Japanese society is one of the super-ageing populations on Earth. Furthermore, it seems that these rather disadvantageous demographic trends lead to increased urbanisation and the eventual total depopulation of rural areas. For the country, migration is not a viable solution; instead, to fight the severe labour shortage the country intends to increase automatization and robotization. The Japanese developments can serve as constructive examples for European and American societies too, where the population is also ageing rapidly.

9 out of 10 Japanese inhabitants are living in cities.

The population of Japan is around 127 million, however, according to forecasts, by 2050, it can shrink to 97 million. It is needless to say that such a significant ageing has a serious impact on the economy too. The country has not been able to leave deflationary environment for decades, moreover, Japanese people might have to get used to slow economic growth and yields around zero percent. Though, many countries wish their economies stagnated at this level.

For years, the government has been working on ways to somewhat increase the country’s birth-rate, something they would like to achieve by improving women’s employment, and creating labour relations that enable having children (for example, part-time and flexible employment, extending maternity leave). The Japanese birth-rate has declined by a third in a couple of decades; on average, one Japanese woman gives birth to 1.4 children.

The prospects of rural Japan are the least rosy due to the effects of ageing. The island nation is known for its high population density and its inhabitants concentrated in certain areas – however, megacities ‘drain’ people from rural areas. This way, with a bit of exaggeration, the country looks like a huge city-state, where the majority of the population lives in cities and their agglomeration, like Tokyo, Osaka and Nagoya. It is only a matter of time these cities merge; thousands of people are already commuting hundreds of kilometres every day from one city to the other via railways.

The impact of urbanization is quite evident: while in 1950, before the big economic recovery, more than half of the country’s population lived in the countryside, today, about 93% lives in urban areas (in the USA, it is 81%).

This is due to that the life of young people with rural backgrounds quickly gets interwoven with a city (because of universities or jobs). Ageing society and internal migration to cities result in the slow depopulation and the eventual disappearance of rural towns and villages. According to the Japanese Ministry of Interior’s estimation, in 15 thousand communities out of 65 thousand, half of the population is above 65 years old. However, some believe that by 2040, 896 settlements can disappear, and the rate of youth can further decrease in dozens of other cities. Maybe it only takes two generations for rural population to drastically drop.

However, the rural population disappearing is not the sole source of the problem, since times have changed, and settlements that used to give living to masses can no longer do so. These regions have difficulties figuring out how to maintain local authorities with less tax income (sometimes they have to merge or close down institutions) or how to provide services to fewer and fewer people.

In rural areas, the question is not how they could stop the inevitable depopulation, but rather how they could lower it so it would be less difficult.

Of course, other parts of the world are facing similar challenges, since the societies of the developed countries too are ageing and the population concentration in big cities is skyrocketing. However, these processes are the fastest in Japan, giving a projection of the future and possible solutions for other countries.

Is migration or robots the solution?

An evident solution is migration – something that has been advised to western countries too. However, Japan is quite unique in this regard too because its foreign population is only 1.8%, in contrast to the USA, where it is around 13%. Furthermore, Japanese people would not welcome growing migration – a recent public inquiry showed that about two-thirds of them would not support an increased influx of foreign labour.

The Japanese would rather utilize technology and take advantage of automatization, robotization and artificial intelligence. While the rest of the world startled that the technological advancements will put masses on the street, the Japanese see them as a part of the solution.

We can hear every day that Japan has employed another robot. Besides, that robots can replace humans in more and more positions, they can also enter areas such as elder care. According to the forecasts of Bank of America Merrill Lynch, IT investments will rise by 9 percent in the following years, and besides industrial companies, the service sector is also thinking about such developments.

Original date of Hungarian publication: September 04, 2017