Japan's premier starts push to bolster sagging birthrate

TOKYO -- Many young Japanese are too busy logging hours at the office and enjoying the material spoils of their hard work to even think about marriage, let alone kids.

It's a trend Prime Minister Junichiro Koizumi sought to reverse Tuesday when he ordered top aides to draw up policies to make parenthood more attractive and affordable for the country's swelling ranks of childless 20- and 30-somethings.

Back in March, signaling an ongoing concern over Japan's plummeting birthrate and aging population, the Cabinet issued a report that urged people to work less and have more babies as part of a "structural reform in lifestyle."

But Koizumi's latest push underscores Tokyo's resolve. He gave his ministers a September deadline for outlining plans to make it easier to raise children. Ideas range from cutting the work week and improving access to childcare.

"This issue of population decline affects the economy, employment, education, really every aspect of life," said Koizumi's spokeswoman Misako Kaji.

Health Minister Chikara Sakaguchi put it more bluntly at an afternoon news conference: "If we go on this way, the Japanese race will cease to exist."

While that may be an exaggeration, Japan's shrinking work force will only undercut its already sagging economy. And covering the health and retirement costs of the graying population is already is one of the government's biggest challenges.

A Health Ministry report issued last week emphasized the risk -- forecasting that company employees would have to pay nearly 25 percent of their salary as pension premiums to maintain the current payouts in 2025.

Fall forecast

Japan's population is expected to peak at around 127 million as early as 2006 and fall rapidly over the next 50 years to roughly 100 million as the nation's birthrate declines.

Meanwhile, the graying of Japan will accelerate with people over 65 becoming 35.7 percent of the population by 2050, roughly double the 17.4 percent in 2000.

That means fewer working people will be left to cover the costs of the aged.

Part of the problem, according to Koizumi's Cabinet, is that marriage and child-rearing are increasingly shunned as sources of fulfillment by young people. Others forgo having children because juggling work with child-rearing is too difficult, especially as Japan's limps through a third recession in a decade.

Koizumi's new push is aimed at policies that relieve some of those pressures. "But the idea is not to ask people to come home from work and make more children," Kaji said.

While economists agree Japan is risking demographic disaster, some disagree that addressing birthrate is a viable long-term solution. Most mature economies naturally experience a declining birthrate, they note. But Europe and the United States keep their populations stable -- if not increasing -- with immigration. Japan has no large-scale immigration policy.

"You can talk about boosting the birthrate," said Jesper Koll, chief economist for Merrill Lynch in Tokyo. "But the issue is that there's no immigration in Japan. That's the one area in which Japan is really different from the rest of the world."

According to the Organization for Economic Cooperation and Development, roughly 9.9 percent of Germany's work force and 11.7 percent of the U.S. work force was born overseas. In Japan, the figure is only 0.25 percent.

It is also unclear whether government policies can buoy birthrates enough to help. Japan's birthrate has fallen steadily over the last 30 years to only 1.35 births per woman. A birthrate of 2.1 is needed just to keep the population stable.