With Abenomics seemingly a total failure (aside from managing to collapse the currency and living standards of the population - worst Misery Index in 33 years) the demographic crisis that Japan faces just got more crisis-er. As Japan's population continues to fall (4th year in a row), what makes the situation worse, as NHKWorld reports, is that there are now a record 33.8 million people over the age of 65 (a record 26.7%), more than double the number under the age of 14 (16.2 million). The ministry says the population will likely continue declining for some time as fewer babies are born and society ages... and as America is beginning to see as retirement dream remain elusive, the number of working elderly increased for 11 years in a row to reach a new record figure of 6.81 million in 2014.
Population is forecast to keep falling...
And, as NHKWorld reports, will continue to get greyer and greyer...
The number of Japanese aged 65 or older has risen to a new record of about 33.8 million people, or 26.7 percent of the population.
The Internal Affairs Ministry released the estimate ahead of Monday's national holiday, Respect for the Aged Day.
The ministry says about 33.84 million people aged 65 or over were living in Japan as of last Tuesday. That is an increase of 890,000 from the same period last year. Men account for about 14.62 million of the total, and women, 19.21 million.
People in the elderly age bracket now account for a record 26.7 percent of Japan's population -- an increase of 0.8 percentage points from last year.
The number of Japanese aged 80 or older has risen by 380,000 from last year to10.02 million, topping 10 million for the first time.
And finally, as we are beginning to see in America...
The ministry says the number of working elderly increased for 11 years in a row to reach a new record figure of 6.81 million in 2014.
10.7 percent of Japan's working population aged 15 and over are in the elderly bracket.
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As we discussed before, there are now more than one in four Japanese citizens will be over the age of 65, up from one in five in 2006 and one in 10 in 1985. The proportion of the population over 65 is expected to swell to 30 percent by 2022 and to 40 percent by 2050, according to government estimates. This will put the country as a whole in the demographic range of the prefectures that experienced the sharpest declines in growth in the decade ended 2009.
Fewer workers and less labor will reduce the potential output of the Japanese economy, which will increase the country’s reliance on imports as retirees continue to spend, inhibiting GDP growth. The rising number of retirees will strain the government’s welfare programs and the country’s pension funds, which have been major buyers of government bonds. Japan already maintains the world’s second-largest debt load in nominal terms and it's growing.
The government sees this problem and has passed a bill giving private-sector workers the right to remain at their jobs until the age of 65, rather than the current 60.
Japan’s demographics will also likely have an impact on consumer behavior. Japanese consumers older than 65 are less likely to shop for alcohol, clothing, books and electronics compared with younger consumers, according to a McKinsey survey from 2011. The average senior shops for books and clothing 38 and 35 times per year, respectively, compared with 73 and 58 times for people between the ages of 18 and 34. The only item seniors shop for more frequently than younger consumers is food, McKinsey found.
How Japan faces its demographic challenges over the next several decades may provide important lessons for countries such as China, which has a rapidly increasing senior population due largely to the one-child policy. People over 65 account for nearly 10 percent of the population in China — similar to Japan in 1985 — up from 6 percent 20 years ago.
China now faces a similar trajectory, as seen in the chart above. Its working-age population—defined as those between ages 15 and 64—is peaking and is set to decline in the years ahead.