The dark side of Japan's demographic outlook is well known: Barring a dramatic shift in immigration policy, the country faces a steady decline in numbers until not long after the year 3000, when the last Japanese in the world will pass away.
But however grim the long term, the short-term effects of this shift are not all bleak. Over the next decades, our aging population offers many economic and social opportunities to shape the country for the better -- and improve people's lives. The question is whether we have the imagination and the courage to make the best of this chance.
With a falling birthrate, and a longer life span, Japan has become a nation of senior citizens. Currently, 34% of Japan's population is over 60. In 20 years, that figure will rise to 41%. Japan is no longer a country where sun rises, but rather where sun sets.
But it is very important to understand that the current generation of over-60-year-olds is vastly different from the same cohort of a decade or two ago. They are healthier and more vibrant. The average healthy life expectancy has risen to 70 for men, and 74 for women according to the latest government statistics.
Moreover, these young-olds are richer than their predecessors. Statistics show that accumulated financial assets owned by the over-60-year-old households constituted 69% of the Japanese total in 2016, up from 53% in 2002. While households in this segment have increased from 17 million to 26 million in the same period, average savings per household have also increased from 43 million yen ($383,000) to 47 million yen, the equivalent of roughly 24 million yen per head, which is more than double the 10 million yen figure for 40-49-year-olds. The financial comfort of the elderly is even more pronounced when you subtract debt to arrive at net savings, in contrast to those in their 40s and 50s who are still typically burdened with mortgages.
Senior gyms are booming
Moreover, these sprightly oldsters are spending their money on goods and services that a previous generation might have found very unfamiliar. For example, people between 60 to 69 years of age account for 37% of the 400 billion yen spent annually on fitness clubs, a market growing at healthy 4.6% a year thanks to the seniors.
Even the 70 to 79 year-olds, with a 21% share of the fitness club market, dwarf the spending of those in either their 20s and 30s, according to studies by the Ministry of Economy, Trade and Industry (2012) and Nikkei Marketing Journal (2016).
Not surprisingly, companies are seizing these opportunities. For example, retail giant Aeon is equipping shopping centers with gyms for older people. These "senior gyms" are typically roomier with an emphasis on a friendly environment rather than rigorous workout equipment.
At the same time, conventional lifestyle norms in Japan have also changed dramatically. The number of Japanese who have never married by the time they reach 50 is rising sharply: up from 9% in 1995 to 24% in 2015 for men, and from 5% to 15% for women in the same period. On top of this, even married Japanese are increasingly choosing not to have children.
A simulation shows that by 2035 half of the nation's population will be single. This too is a business opportunity. It is, for example, giving rise to new offerings such as leisure travel packages designed specifically for single travelers, a segment traditionally shunned by the Japanese hotel industry for fear of client suicide risks.
Chances for the childless
There are many intertwined socioeconomic reasons behind the growth in the single and childless population that will not be quickly reversed. While this drives a seemingly relentless population decline, it also means that an increasing part of the population has significantly more free time in their adulthood, compared with those who have offspring and need to look after them and their families. So, they have more time for themselves.
Volunteering is quietly gaining momentum. The Japan International Cooperation Agency, which coordinates development aid, offers programs for older people of 40-69, as well as for the young, to live abroad and assist in everything from engineering to welfare. The "senior" volunteer program has grown so much in popularity, that there are now 2.5 candidates for every place compared with 1.5 two short years ago.
Some things are already happening at the grassroots. For example, there is a community house in Fukuoka Prefecture, in western Japan, that looks for independent senior single women to cohabit with younger single mothers so they can play surrogate parents. But much more can be done.
Moreover, these seniors are free of the conventional concerns about building a huge financial nest and preserving it till the end to pass on to their offspring, a common feature across Asia.
It could greatly benefit Japanese society if more of these funds were channeled to the public good. NHK, the broadcaster, recently ran a program on charitable donations. The broadcaster profiled a case of an elderly woman who spent her three-decade-long career as a playschool teacher; in her will, she donated 34 million yen to local playschools when she died. The government estimates that posthumous giving currently amounts to 30 billion yen a year and is increasingly rapidly.
Both lifetime donations and bequests can be exempt from taxes as long as the receiving organization is government-approved. With inheritance taxes rising, we expect such gifts to increase and close an infamous gap between Japanese and their peers in the industrialized world.
As the childless realize the finiteness of life, they will be naturally more attuned to making the best of their quality of life. As I enter my mid-40s having chosen not to have children, I also ponder how I may contribute to the sustainability of humankind and our planet, especially as I have little direct personal stake in future generations. I belong to a generation of Japanese who have lived, as adults, through the post-bubble era of stagnation and economic frustration. We can be as weary of materialism as the (younger) Millennials.
Japanese policymakers, businesses people and social organizations need to jointly develop solutions. It is up to us to decide whether we simply sit and sulk in the sinking ship of demographic decline or go down with a spectacular flourish.
Nobuko Kobayashi is a partner at A.T. Kearney in Tokyo.