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A national discussion will be held on "countermeasures to the declining birthrate in another dimension (Extraordinary Measures to Curb Fertility Decline)”.
I thought it would be a good idea to organize the discussion once when I started writing this blog a little over a decade ago, but I lost the opportunity and here we are now. However, some of you who have read my book "Shin Nihon" (NewsPicks 2020) may remember that I went into considerable depth in my discussion there.
Discussion of this topic will require consideration of the following three-stage question.
- What exactly is the problem with the declining birthrate?
- If it is a problem for some reason, what is the structural background?
- What kind of situation is desirable and what kind of measures should be taken to achieve it?
However, this society (namely in Japan) seems to be in a state of confusion, with many people jumping to the conclusion of 3.
The background to the problem of the declining birthrate in 1 is, therefore, rarely verbalized, but there seem to be four major stories (excerpted and quoted from "ShinNihon," Chapter 6, "Is Population Decline Bad?").
(i) The economy is likely to shrink during a phase of population contraction
(ii) A smaller economy will not be able to repay its government bonds (could trigger a financial collapse)
(iii) If the ratio of seniors to young people becomes even more senior-oriented, the social security framework will lose its ability to support seniors.
(iv) If this situation continues, the population will disappear.
Of these, only (ii) is unconditionally correct, but its premise is (i). In essence, the discussion is based on the assumption that without population growth, productivity per capita cannot be increased significantly, and that there is no other way to generate economic scale other than through population growth. (iii) is based on the assumption that the definition of senior citizens will not change.
As we have seen, Japan's productivity has a considerably large room for improvement. To begin with, it has not even caught up with the G7 countries. There are many industrial sectors where there is room for productivity improvement of several times or even more than 10 times. In other words, the immediate decline in population and working-age population can be solved in large part by simply bringing Japan's productivity in line with the other G7 countries.
Human productivity has increased almost 100-fold over the past 200 years. As new technological innovations occur, there will be a 10-fold increase in per capita wealth over the next 100 years, as there has been in the past, if we do not buck the trend.
We are entering an era in which the only economic advantages of human "numbers" are honestly limited to the acquisition of training data when creating AI and the consuming population. Learning data can be obtained by doing business on a global scale as in the past, and fortunately, there is more than enough population in China, India, and other Asian countries to serve.
The time will come when people will be proud as long as they live and contribute to society to the extent of their capacities.
In other words, the argument that population decline is a major problem for economic reasons is likely to be misplaced if we look at the reality correctly.
Therefore, the essential issues are to increase productivity to world-class levels, to develop businesses that can contribute to society on a global scale, and to create a society where people can continue to create value within a reasonable range without being forced out as they get older.
This would mean that this discussion on the declining birthrate is meaningless, but that would be the end of the discussion, so let's continue the discussion a little further to the background of the declining birthrate in 2.
This is the story I mentioned the other day at the Ministry of Education (MEXT)'s throw-in, and as FACTFULNESS states, the most base background is that "affluence leads to longevity, but affluence leads to a rapid decline in children" worldwide.
This is why, with the exception of the U.S., almost all major countries, including China, are in a population adjustment phase in which the working-age population is falling. In the case of the U.S., the working-age population is increasing due to immigration, which will begin to decline by 2030 if immigration stops (Shin Nihon, Fig. 1-12). India, which will soon overtake China in population, has seen a rapid decline in the number of children over the past few decades, and its fertility rate, which was near 6 until around 1970, finally fell below the 2.1 level needed to maintain the population last year. It is only a matter of time before India enters a similar adjustment phase.
In the first chapter of ShinNihon, I wrote, "Looking at the projections of the United Nations and other organizations, it appears as if the population growth of Africa and India shows no sign of stopping at this point. However, this does not fully factor in the impact of the country's future affluence, as discussed in FACTFULNESS".
It is not so difficult to understand why affluence reduces the number of children. In poor states, sanitation and health care systems, including water and sewage systems, are weak, and a large number of children need to be born as a buffer because by the age of five a significant number of children are lost. In addition, children are labor force to begin with, and begin to add value economically as early as age 10 or so, without any or very long education. In Japan until the mid-Meiji period, a child could be working in the fields at the age of 10 or less, or serving as a nanny for a younger sister or brother, or even serving as an apprentice after a few more years. In other words, the "incentive to have more children" is quite strong when society as a whole is poor.
In addition, in the past, when the economy was at a poorer stage, both men and women came of age earlier, and it was not at all unusual (especially for girls) to get married in their teens. This is understandable if one recalls that in Japan, the age of Genpuku (the ceremony of social recognition and celebration of adulthood) of the samurai family was between 11 and 17 years old. This is also clearly shown in Factfulness, but it is forgotten that until about 1800, the majority of people in almost all countries now belonging to the OECD (currently rich countries) were poor by today's standards.
As societies become more affluent, the proportion of children who survive to adulthood becomes extremely high, and the incentive to produce more of them falls significantly. Secondary education (equivalent to junior and senior high school education in Japan) becomes the norm, and the economic burden on parents rises, as well as the age at which they produce more children, across the board.
When a significant proportion of the population goes on to higher education (in Japan, universities, technical colleges and vocational schools), the age of first marriage naturally rises further. In pre-war dramas, you may have seen many students from girls' schools getting married before graduation, which is a typical scene from a transitional period. Needless to say, the economic burden on parents increases, which in turn causes further negative feedback. The average age of first marriage in Tokyo was 32.3 years for husbands and 30.5 years for wives in 2008, an increase of 4.7 years for husbands and 5.0 years for wives compared to 1975" (Tokyo Metropolitan Government, Comprehensive Plan for Supporting Children and Child Rearing (Phase 2), Chapter 2: "The situation surrounding children and families in Tokyo").
Then, as the following historical paper by Dr Menken shows, we hit a biological limit: the phenomenon of a sudden decline in the fertility of children from around the age of 30 or so. In parallel, at this economic stage, both from the perspective of maintaining independence as a human being and from the perspective of maintaining an economic standard of living, mothers are expected to be working, and the question of who to ask to raise children becomes apparent.
Menken, Jane. “Age and Fertility: How Late Can You Wait?” Demography, vol. 22, no. 4, 1985, pp. 469–83. JSTOR, https://doi.org/10.2307/2061583.
Furthermore, so-called career women tend to have less incentive to have a second child or more, both because of their avoidance of career blanks and because of the learning effect of the higher-than-expected burden of child rearing. It is not surprising that the background to career blanks may be the inability to work remotely when appropriate and the lack of understanding of the need to temporarily leave the workplace to raise a child.
In summary, as society becomes more affluent, the following four major levers will synergistically lead to a rapid decline in fertility.
- Children are more likely to survive childhood and there is less need to have more (this is a good story).
- The incentive to have more children falls sharply in the first place, as children are not expected to be in the workforce and are rather expensive to bring up (the first half is a good story).
- As people marry later in life, they run into biological limits and the probability of infertility increases.
- With the shift to careers, the negative impact of taking longer breaks for childbirth and child rearing rises.
It is not humane in any way to reduce the probability of survival in childhood or to force children to be expected to be part of the labour force. As for the economic costs of raising children, it is quite possible to fully support them on a needs basis in a safety net manner (social security, as a basic function for the maintenance of society). Depending on the unit cost of education, there should not be anything with a higher ROI than child rearing and human resource development, which should naturally be considered.
The fact that it depends on the unit cost means that it may not really be economically viable when it comes to the cost of education at the level of a U.S. university. However, in many civilized countries, getting an education is directly linked to a person's basic ability to live proudly and autonomously (or socially qualified), and not being able to get one because of money should be avoided as much as possible.
Incidentally, when I studied at Yale, one of the private *2 national universities *3 on the East Coast of the United States from 1997 to 2001, basically all PhD students and 77% of undergraduates received some kind of Even for undergraduates, mainly from the university. I remember that the standard for receiving aide was an annual household income of about $370,000. If universities with high educational expenses can take appropriate measures in their own way, it should not be a serious problem. In Japan, however, the cost of some private elementary and secondary education, medicine, arts, some graduate schools, and preparatory schools that prepare students for these schools is particularly high. This appears to be a major area for improvement.
Regarding biological limitations, it is important to create a society where young people can have children after completing secondary education. Even if it is not possible to have a wedding, the birth of a child should be welcomed by society, and the tendency to avoid this should be avoided. In the case of large institutions of higher education or workplaces where many people gather in real life, it may be necessary to provide facilities to take care of children. It will also be necessary to make efforts to accommodate children who can be raised without marriage, in a de facto sufficient manner (if both parents are able to commit). In addition, it would be necessary to prepare for early liquid nitrogen freezing of gametes (eggs and sperm) and surrogate motherhood (called Surrogacy). *4
There seems to be a lot that can be done to address the negative impact of long maternity breaks on career development. We should have more and more workplaces that allow remote work, unless it is in the face-to-face service industry, and we should have a society where people can work even if it is only for 1-2 hours a day, and even then they should be compensated based on their output rather than their working hours. In areas where there is not enough capacity to accept nursery schools and school children, it is essential to expand the capacity and improve the compensation of nursery school teachers (this is something that can be done by the leaders of local governments). It is likely that the social security system will need to provide some level of support during this period. Of course, the employer can provide additional support in the form of a cover, and such a system would be necessary to ensure that such workplaces are highly valued in terms of diversity, equity, and inclusion (DE&I) and social sustainability. It would be effective to praise and share good cases rather than criticizing those that are not working.
These are just a few thoughts from the lever that causes the falling birth rate, but I think the discussion will be much clearer if we think about it in this way.
There is actually one more issue that needs to be considered.
As we have seen, a declining birthrate is halfway inevitable to some extent, and is likely to continue over the long term. Although I have not mentioned here, it can be said that this is a good trend from a macro perspective in this phase in which we must inevitably strive for the coexistence of humankind and the earth. On the other hand, keeping a society running under such a gradual, albeit long-lasting, situation, which could last for decades, or even a century or more in some cases, is a fairly new problem. Indeed, there have been many instances of plague and smallpox in the Middle Ages, and in modern times, famines and other events that have resulted in a sudden loss of 1/4 to 1/2 of the population in towns and villages (especially hitting the elderly and children). However, this is a transitory story at the level of a few years, and is qualitatively very different.
Economically, as mentioned above, it will be quite possible to overcome this situation while avoiding downsizing by utilizing technological innovation, renewal of the basic social framework, etc. However, the majority of the infrastructure created in a society with too many people will actually become unnecessary. Many of the systems (companies, schools, etc.) that have been built on the assumption that people could be employed in large numbers one after another will no longer be able to continue in the way they have in the past. Many of the services that could only be created on the basis of manpower will become unsustainable. This is inevitable from a macro perspective *5, and innovation will be required one after another. This is the inevitable outcome of this story. It is almost certain that many unicorns and decacorns will emerge from this.
Like Covid19 three years ago, I am happy to be living in a truly unique and interesting phase. A society has begun in which everyone can be a hero or heroine.
(translated with a big help of DeepL. My sincere thanks!)