The Effect of Population Aging on the Japanese Economy and
Society: A Case of Vietnam
Huynh Tan Hoi
Department of Language, FPT University, Ho Chi Minh city, Vietnam
Keywords: Aging, Challenges, Population, Japan, Vietnam.
Abstract: Population aging is an urgent problem facing many countries globally. It is happening at different rates in
many regions. This process is happening more rapidly in developing countries, including countries with young
populations. This changing process constantly brings challenges and dynamic opportunities in many
economic, cultural, political, and social fields in life. The aging population is one of the most important trends
of the twenty-first century. Speaking of this issue, first of all, to mention Japan. Japan ranks 11th in the
topmost populous country in the world and is also one of the countries with the highest population life
expectancy in the world. Due to social and economic problems, many young Japanese currently tend not to
marry or have children, causing the fertility rate to drop sharply. With a low birth rate and high life expectancy,
population aging is quickly becoming a serious problem for Japan. This paper analyses the challenges that
Japan is facing and draws mention of some solutions for developed countries, including Vietnam. The results
of the article show that developed countries like Vietnam need to consider more about olicies and plans for
the long term in the future.
The world's population is not only increasing but also
gradually aging. Our world is experiencing huge
demographic changes and no country is immune to
the consequences. Increasing life expectancy and
decreasing fertility are considered enormous
achievements in modern medical and scientific
development, especially when living conditions are
much better than before. However, at the same time,
population aging is also an inevitable result of the
reduction in the birth rate and the rate of the elderly
increasing faster than other age groups. Population
aging is still a difficult problem for the Japanese
government, it entails a lot of consequences for the
problems in Japan's socio-economy (Charvat et al.,
2015). The population structure has gradually shifted
to the aging trend, leading to a serious shortage of
young workers in most industries, leading to a
shortage of human resources. The health conditions
of the elderly cannot be guaranteed nor are young
workers enough to meet the labor market.
According to the classification of Cowgill and
Holmes (1970), when the population aged 65 and
over is between 7% and 9.9% of the total population,
the population is considered "aging". Similarly, 10%
-19.9% is called the "old" population; 20% -29.9%
call the "very old" population and 30% or more are
called "super old" population, many reports from the
United Nations and international organizations use
this classification. And in recent years, Japan has
been one of the countries with a fast rate of aging
population, while the fertility rate has dropped
sharply (Charvat et al., 2015). Population experts
warn that the trend of having few or no families and
having children is becoming a common phenomenon
in Japan (Hagihara et al., 2013).
The impact of human resource quality on socio-
economic growth is at the heart of policy debates and
related research. Consequently, the relationship
between population and economic growth has
traditionally been emphasized (Goh & McNown.
2020). Since the 1980s, changes in the age structure
of the population towards economic growth have
Huynh, T.
The Effect of Population Aging on the Japanese Economy and Society: A Case of Vietnam.
DOI: 10.5220/0010590903750380
In Proceedings of the International Scientific and Practical Conference on Sustainable Development of Regional Infrastructure (ISSDRI 2021), pages 375-380
ISBN: 978-989-758-519-7
2021 by SCITEPRESS Science and Technology Publications, Lda. All rights reserved
attracted the attention of researchers (Maison, 1997;
Bloom and Williamson, 1998). Besides, according to
estimates of the National Institute of Population and
Social Security (2007, 2008), the number of people
over 65 years old was 25.76 million (20.2%) in 2005;
36.67 million (31.8%) in 2030 and the number of
elderly living alone (excluding the elderly living in
social welfare facilities) increased from 3.87 million
to 7.17 million. Due to the rapid decline in the birth
rate, Japan will soon be a super old society unlike any
other in the world.
The paper analyzes in-depth influences in two key
economic and social areas in Japan. In addition to
applying statistical methods, analyzing and
synthesizing data, the article also has comparative
statements that have been referenced from the
literature of many previous research scholars.
Materials used for synthesis and analysis are mainly
statistics of relevant ministries published.
Japan's current population was 126,429,826 as of
August 6, 2020 according to the latest data from the
United Nations. The population density is 347 people
/ km2. The average age is 48.4 years old. Japan
population is currently 1.68% of the world
population. The Japanese Ministry of the Interior and
Communications has released the results of the
survey, showing that the country's population has
decreased for the 11th consecutive year, and recorded
the largest number and rate of decline in the history
of population statistics (Ihori et al., 2006). Over the
past six years, the Japanese population has decreased
continuously, reflecting the trend of rapid aging and
a low birth rate (Sakai et al., 2000).
As of early 2017, it is estimated that Japan has the
following age distribution: under 15 years old, from
15 to 64 years old, and population 65 years and over.
Population data by age (estimated): 16,585,533
adolescents under 15 years old, 80,886,544 people
aged 15 to 64, 28,913,148 people over 64 years old.
Below is a simplified model of the population
pyramid divided into three main age groups (Figure
1).The aging of the Japanese population begins later
than the developed countries in Europe and America,
and the rate of aging is very fast. Since 1990, when
the period of population growth peaked, working-age
Figure 1: Age structure in Japan (estimate as of early 2017)
people are getting older, at the same time, the number
of young workers aged 15 to 19 is decreasing (Goh
and McNown, 2020). Population aging is already
happening and the total workforce is starting to
decline. If the fertility rate continues to decline, the
aging rate will increase rapidly in the future. Below
are future population estimates based on hypothetical
calculations by the Ministry of Home Affairs and
Communications Census 2010, National Population
and Social Security Research Institute 2015 Japan
(Figure 2).
Figure 2: Estimated future population of Japan (2015)
Not only in Japan, but aging is becoming one of
the topics of worldwide concern. Without careful
preparation, the government will have to spend huge
amounts of money and these expenditures will have a
negative impact on the state budget as well as the
long-term financial sustainability of the entire
economy (Takaki et al., 2014). Although it has been
adjusted and supplemented, there are still many
Under 15 years old 15 -64 years old
Over 64 years old
0-14 years old
12,039 10,732 9,387 7,912
15 - 59 years
59,498 50,079 43,924 38,479
60-64 years old
8,231 7,787 6,089 5,704
Over 65 years
36,85 38,679 37,675 34,641
ISSDRI 2021 - International Scientific and Practical Conference on Sustainable Development of Regional Infrastructure
shortcomings that cannot meet and adapt to the
current situation of the elderly life as well as the
consequences of changing the population age
structure towards aging. Without proper strategies
and policies, Japan will face more challenges both
now and in the future.
5.1 The Effects of Population Aging on
Japan's Economy
The primary impact is sluggish economic growth due
to a shortage of young workers, and the aging
population is causing many industries in Japan to
scale down their operations or move production
locations to other countries. Some companies
working in other fields, even though they do not have
difficulties in production capital or compete at home
and abroad, have to narrow their production because
they cannot find a source of labor, especially young
workers. good force. Facing alarming population
aging situation, the Government of Japan issued a
warning, by 2060 nearly 40% of the population of this
country is elderly. This is a big obstacle to the
recovery of Japan's economic growth as the young
workforce is less and less. If there are too few young
people in the workforce, it will be difficult to have
enough taxpayers - the main source of income - to
operate and develop the economy. At the same time,
the scarcity of young workers causes the rate of
economic growth and technical innovation to decline
(Charvat et al., 2015).
Next is the decrease in consumer demand,
threatening economic growth. Elderly people tend to
save more than young people, but spending on
consumer goods is less, so the consumer market is
also adversely affected, the revenue of businesses
also declines. Depending on the age at which this
change takes place, a country with an aging
population may experience low interest rates and low
inflation rates. Also because older people consume
less, countries with a high proportion of the elderly
often experience low inflation (Goh and McNown,
2020). In addition, a decrease in population also
means that production decreases and consumption
demand also goes down, directly affecting GDP
growth of the world's third largest economy.
Meanwhile, the ratio of public debt to GDP of the
country is 237.6%. Public debt in Japan is mainly paid
off through people's savings at banks or buying
government bonds. That makes the third world
economy have to increase the speed of borrowing to
pay debts in the coming time (Hagihara et al., 2013).
Population aging causes the burden of social
security benefits to put pressure on young people's
shoulders. For the elderly, pensions are the main
source of income. The aging population brings a
burden on social security benefits as the number of
pensioners is increasing. Data from the National
Institute of Population and Social Security of Japan
shows that in 2001, Japan spent 81,400 billion yen on
social security expenses, accounting for 22.0% of
national income; pension accounts for 11.50% of
social security costs, an increase of 130% compared
to 1995. The broad social security policy based on
progressive income tax, although there are many
advantages in implementing social justice, also makes
a part of business owners dissatisfied, leading to a lot
of investment capital being moved to other countries,
reduce the growth motivation in the country, etc. This
has created great pressure on society on the Japanese
Government in the process of reforming and
upgrading the social security system (Goh and
McNown. 2020).
Besides, the "gap between generations" is
increasing. As many elderly are influential in the
political sphere, national policy will pay more
attention to social welfare programs such as
increasing health budgets, expanding healthcare
facilities and pensions. This would provoke a wave of
protests from young people that threaten the unity
inherent in Japanese society (Hagihara et al, 2013).
Japan's health spending, for example, increased from
6.1% (16 trillion yen) in 1985 to 8.6% (31.5 trillion
yen) in 2003, and is expected to grow to 12, 2% by
2025. At the same time, the proportion of health
spending for the elderly in the total health budget of
Japan continues to increase steadily each year (from
25.4% in 1985 to 36.9% in 2003 ). It has led to a huge
financial burden on Japan's healthcare. Since 2000,
Japan has built and implemented a project called
Healthy Japan. This is a 10 year project to improve
the nation's health. The project's biggest goal is to
stop people from lifestyle-related diseases that have
killed about 60% of Japanese people, including
cancer, cardiovascular disease and stroke, and
prolong the amount of time they have. healthy life
(Ohtake and Saito, 1998).
5.2 Comparison of the Population
Aging of Japanese Society and the
Population Aging of Vietnam
In Vietnam, due to the change in the age structure of
the population following the decreasing trend of the
The Effect of Population Aging on the Japanese Economy and Society: A Case of Vietnam
proportion of children under 15 years old and the
increase in the proportion of the population aged 60
and over, the aging index tends to increase. up rapidly
over the past two decades. This is both an
achievement but also a challenge, we need a strategy
to capture and adapt, turn challenges into
opportunities. After the population aging period
begins in 2011 with 9.9% of the population aged 60
and over, Vietnam will go through the aging
population from 2026 - 2054 when the proportion of
people aged 65 and over. accounting for 10-19.9%.
Vietnam is not rich yet, but the population is already
aging. And from 2054 - 2069, Vietnam will go
through a very old population stage, when people
aged 65 and over account for 20 - 29.9%. Vietnam is
also considered a country that has time to move from
"population aging" to "aging population" into the fast
group in the world, the forecast is 20 years, while
Japan and China are 26 years, the UK and Spain 45
According to the Population and Housing Census
at the year of 2019, the average life expectancy of
Vietnamese people is 73.6 years; of which, life
expectancy for men is 71 years and for women is 76.3
years. From 1989 to now, the average life expectancy
in Vietnam has continuously increased, from 65.2
years in 1989 to 73.6 years in 2019. The difference in
life expectancy between men and women over the
two recent Censuses almost unchanged, maintaining
at about 5.4 years.
In 1960, the average life expectancy of the world
population was 48.0 years and that of the Vietnamese
population was 40.0 years old, which is 8 years lower
than the average life expectancy of the world
population, that is, it takes about 80 years for the life
expectancy of Vietnam to increase to the level of the
world (Giang et al.,2020). In 2019, the average life
expectancy of the world population is 72.0 years and
that of the Vietnamese population is 73.6 years old,
1.6 years higher than the average life expectancy of
the world. If we also calculate the highest average life
expectancy growth rate of 0.1 years / year, the
population of Vietnam is about 16 years older than
the world population. Thus, the total time the
population of Vietnam is aging rapidly compared to
the world average is about 96 years.
The total number of households nationwide is
26,870,079 households, an increase of 4.4 million
households compared to the same period of the 2009
census. On average, each household has 3.6 people /
household, 0.2 lower than person / household
compared with 2009. In the period 2009 - 2019, the
average growth rate of the number of households is
1.8% / year, 1.2 percentage points lower than the
period 1999 - 2009 and the period the section with the
lowest rate of increase in the number of households
in the past 40 years. Small household size will be one
of the major challenges for the family and community
based aged care model.
Although there are policies in place to increase
fertility in areas with low fertility below replacement
fertility while reducing fertility in areas with high
fertility, the most recently reported fertility rate in Ho
Chi Minh City is above 1, 3 children / mother is still
the lowest fertility rate in the country and tends to
decrease further (Goh & McNown. 2020). Experience
in Korea and many countries shows that if the fertility
level is already low, it will be difficult to increase
fertility again. When fertility is low, the population
ages at a faster rate. In addition, the elderly
characteristic in Vietnam is that over 70% have to
work by themselves with support from their children,
only 25.5% live on pensions and social allowances
(Ihori et al., 2006).
Regarding social insurance, in 2020, Hanoi City
will only have about 40% of employees participating
in social insurance and by 2021, 45% of workers
nationwide will participate in social insurance.
festival. As the population ages, the increase in the
number of old people and the increase in the
proportion of the elderly without pensions / benefits
will become a burden on social security.
According to 2019 data, the sex ratio at birth
stands at 111.5 boys per 100 girls. In which, this rate
in the poorest quintile is 108.2 boys per 100 girls and
the richest quintile is 112.9 boys per 100 girls, while
the ratio is if true. must be 105 boys / 100 girls. As a
result of this situation, it is forecasted that by 2034,
Vietnam will have a surplus of 1.5 million men of
married age and this number will increase to 2.5
million young men by 2059. So far, the intervention
has not been effective. Currently, very few provinces
have any form of support for families giving birth to
a baby girl, the level of support is not much. From
mid-2020, the Government has also issued guidance
on adjusting fertility to suit the region / region, in
which localities with low fert
Adapting to population aging should be considered a
priority issue, requiring timely and comprehensive
solutions to target all population groups to prepare for
the aging society in the near future, not just practice.
focuses on solving problems of the elderly group.
Therefore, it is necessary to implement some
effective solutions. One of the policies to limit the
ISSDRI 2021 - International Scientific and Practical Conference on Sustainable Development of Regional Infrastructure
rate of population aging is to maintain replacement
fertility. Viet Nam has maintained a replacement
fertility rate, keeping the total fertility rate around 2
children per mother from 2006 to the present.
However, the policies to further support are very few,
even not yet available. We need more schools,
kindergartens, and support for young couples to
improve the aging of the population.
Firstly, it is important to raise awareness and
understanding of managers, policymakers as well as
the entire community about the challenges of
population aging with the lives of the elderly in
particular and the whole society in general. That
means that we need to have more awareness and
responsibility of each citizen, family and the entire
society in promoting the role and experience of the
elderly, taking care of the elderly, building a friendly
environment for the elderly (Giang et al.,2020). The
effects of population aging need to be integrated into
socio-economic development strategies, plans and
Second, the social subsidy for vulnerable elderly
groups needs to be expanded and reach a universal
system for all elderly, with special emphasis on
supporting the rural elderly and elderly women
(Korinek et al., 2019). The rate and method of
payment should be considered to suit the living
conditions and health of the elderly. The object
identification needs to be reformed to avoid errors in
the acceptance or exclusion of the object.
Third, strengthening health care, building and
expanding aged care services with active and
proactive participation of all social sectors and
strengthening national capacity in care for the elderly
should also be taken into consideration (Korinek et
al., 2019). Attention should be paid to the
management and control of chronic diseases
(especially cardiovascular disease, hypertension,
osteoarthritis, diabetes, and cancer, etc.) along with
the application of new technologies in early diagnosis
and treatment, long-term treatment of chronic
diseases. It is necessary to build a system of hospitals
and geriatric research organizations nationwide. In
the long term, with abundant and qualified human
resources, Vietnam can provide human resources for
geriatric nursing both regionally and internationally
(Ihori et al., 2006).
Fourth, we need to strengthen the role of political,
social and professional organizations in formulating,
advocating and implementing policies for the aging
of the population and the elderly (Shiode et al., 2014).
Activities to mobilize families, communities and the
whole society to take care of the elderly need to be
promoted and replicated (Korinek et al., 2019). It is
necessary to coordinate with specialized agencies in
research and propose diversification of ways and
models of organizing life for the elderly such as living
with children, living in nursing homes or in care
facilities. the elderly in the community. We also
organize community activities for the elderly on a
regular basis to improve understanding and contribute
ideas of the elderly to the State's policies as well as
the community's life (Giang et al., 2020).
Fifth, the young population will have to be better
prepared to enter old age in a healthier and more
secure state, which will facilitate solving the
problems that arise as the population ages in future. It
is necessary to raise awareness of the society about
the increasing life expectancy, the younger generation
will live longer than the previous generation (Korinek
et al., 2019). We also need to encourage people to
seek out tips on maintaining a healthy lifestyle and
how to change their habits with age; carrying out
advocacy activities to raise awareness about changes
in old age and eliminate negative emotions and fear
of old age. Young people are encouraged to
participate in volunteer work to help the elderly,
thereby it helps the young generation experience the
life of the elderly.
Population aging is a scenario that will happen in
most countries. Population aging in the context of
economic recession and crisis is a huge challenge for
Japan and Vietnam as the aging population requires
more spending on health care, retirement, and
benefits. It makes the economic and social burden
more serious if there is no strategic planning and
proper implementation of adaptation policies and
plans. Applying more comprehensive approaches to
population aging, the country might solve current
problems resulting from the impact of population
aging on both the elderly and the young and in line
with economic development plans.
There is no conflict of interest in the paper.
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