Aging Society Essay

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Aging Society in Japan Introduction The populations of all industrial countries are aging. Japan, whose population enjoys the greatest longevity worldwide, will be particularly affected (Faruqee and Mu¨lessen, 2003). In 2012, aged people (65 years and over) was 30.79 million, constituting 24.1 percent of the total population and marking a record high (Statistics Bureau, 2013). It is expected that close to 30 percent of the Japanese population will be 65 years of age or older by 2025 (Usui, 2009). The aging population will cause a variety of long term problems for Japan’s social security system and family support. It will also put economic burdens on the nation and the government, because of the loss of the labor force and the old-age related costs as well as the declining tax revenues. Therefore, action is needed urgently. This report will explain the social and economic effects and implications of Japan’s aging society, analyze the causes, and suggest possible solutions that contribute to sustainability. Impacts Population change has substantial impacts on the economy and the society, particularly when it reflects underlying structural problems. From an economic perspective, aging society can increase grave challenges to the entire country of Japan and its government. Most straightforwardly, the shrinking working-age populations may reduce Japan’s gross domestic product (GDP). The country’s GDP is the total of its labor force time’s average production per worker. In other words, countries with shrinking numbers of workers will also see GDP decline, unless productivity rises faster than the rate of labor force decline (Hewitt, 2003). The Organization for Economic Cooperation and Development estimates that Japan’s labor force will decline by an average of 0.7 percent a year between 2000 and 2025, and 0.9 percent a year between 2025 and 2050 (Turner and

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