Friday 6 June 2014

(Population) Size Matters....

On one hand while statisticians and economists are exceedingly apprehensive about burgeoning population and the slew of repercussions on the global environment and food security, well developed nations are stung by the fear of lower birth rates. Demography or in common parlance a discussion on size of population is very interesting. While half the countries of the globe are mired by population excesses, the other half is busy designing policies to increase the same. Alas!!!! The world revolves around the paradox of extremities of population.
Japan the third biggest economy in the World has the fourth lowest fertility rate of 1.39 among the Organisation for Economic Cooperation and Development (OECD). Japan’s population is shrinking at an alarming rate. Currently, the population of Japan is 127 million and for the third consecutive year the country registered lowest birth rates. The population of over the age of 65 is incredibly high, constituting nearly one fourth of the total. It is hard to believe but the sales of adult diapers out beats sale of baby diapers in this land of rising Sun.
Japan is reeling under debt, which is twice the national economic output. Much of it due to increased social security and health costs associated with aging population.  As a move to fill state coffers, sales tax has been hiked to 8% from existing 5% and more women are encouraged to enter work force to bolster economy and immigration restrictions have been slackened too. The working population, people between ages of 15 to 65 has suddenly plummeted to less than 80 million for the first time in 32 years. The population of children under 14 stands at 12.9% is slightly more than people over 75 year age accounting to 12.3%.  Government is so alarmed by the looming crisis that it has set up a ministerial post to raise fertility. United Nations estimated that without improving its fertility rate, Japan has to attract 6,50,000 migrants every year. The problems compounding the shrinking population are numerous as Japan is experiencing severe labour shortages. The working population has to struggle to support the growing proportion of the aged population. To mitigate the shortages, industries are already investing in building more robots to work on factory floors and in care homes for elderly. A panel report suggests that fertility rate on an average of a woman should increase to 2.07 to have a stable population level.
Japanese have the highest longevity rate and lowest fertility rate. Since 1990 wages have stagnated and housing prices have shot up. Consequently most people have opted to stay single. Most of the women in Japan are well educated but they assume traditional roles post marriage and forgo their career after child birth. Child care is very scarce and expensive in Japan hence forcing them to make the sacrifice for bearing a child.  Further, the brutal, highly aggressive corporate work culture in Japan demand more than 50 work hours per week. Thus, it is difficult for a working woman to devote time for child rearing. Thus most the young men and women prefer being childless.
The latest Gender Gap Report compiled by Davos-based World Economic Forum ranked Japan 105 (India ranked 101) among 136 countries down by 25 places from 2006. It tracks the country’s gender gap and the national competitiveness. Since women account for one-half of the country’s potential talent base, national competitiveness depends on how significantly it educates and utilises its women.
With plummeting population and fewer than 2% of immigrants Japanese Premier Shinzo Abe is left with an option of relaxing immigration controls. The proportion of immigrants is much less for a rich country. The most recent visitors to Japan include Chinese students who largely run the convenience stores. Earlier in 1990, faced with severe labour crisis, Japanese Car manufacturers have opened doors to thousands of Brazilians of Japanese origins for low wage jobs. Following the economic slowdown in 2008, most of them forced to leave and were paid to return back to their homes.  Consequently the population of Brazilians fell from 20,000 to mere 9,000 and even those who stayed back failed to integrate. Government failed to make provisions for education and other needs of children of the immigrants.
Government is now mooting on plan of accepting the applications of 2,00,000 new  permanent residents from 2015.  There are carefully treading on the plans of allowing such a huge scale of immigration. They even and retraced its stance by gingerly rephrasing the terms of immigration. As of now, the government has decided to give longer temporary Visas to foreigners working in construction business with a precondition that they have to return back after wards. The immigrants mostly include people of South Korean and Chinese origin who have been living in the country for generations. If similar declining trend persists, the population of Japan would be curtailed to 87 million by 2060. A dramatic extrapolation of the data suggests that by 2100, population would become half or one third the present number. In spite of declining numbers, the right-wing group of Japan out rightly rejects the proposal of plausible immigration option, leaving several people dismayed. Hence Abe plans to bridge the acute shortage of the low wage jobs like construction workers and nannies by hiring cheap labour. Japanese are highly xenophobic, highly conscious about their culture and identity and their society is largely homogenous. Even Japanese cities are not geared up for multiculturalism. Immigration seems to be a farfetched option as immigrants are still a big no in this land.
South Korea, a former colony and neighbouring country of Japan is also facing similar situation of declining working population and a growing aged population, also adopts a similar immigration policy.
It is observed that fertility trends are on a fall and the current global fertility is down to 2.5. In Africa where large families are a norm, the fertility is down to 4.7 from 5.7 in 1990-95. Ideally the fertility rate should match the replacement rate hence a fertility rate of 2.1 is recommended. In most of the rich countries it is less than 2. In India, it is 2.51, China 1.5, Europe 1.6, Japan 1.4 and South Korea is 1.3. Even in the South East Asian countries the numbers are slipping below the replacement rate. Worried about the gruesome affairs some developed nations began supporting the policies that raise fertility. These include tax incentives and child benefits for better child care provision and making it easier for women to have children and to work. Fewer children mean fewer workers and as the longevity has increased in developed countries, government is burdened with the task of supporting growing number of pensioners.
Another study conducted by Vienna University of Economics & Business and International Institute for Applied Systems in Austria contests these preposterous worries of the governments as it believes that level of education has a crucial role to play. Educating more people to a higher level would pay off better in long term. Better-educated people are more productive, healthier, retire later and live longer. Thus they contribute more to economy throughout their lives. They recommend that ideal fertility rate in this scenario would be 1.5-1.8. Moreover, fewer the people lesser the carbon-imprint and better future environment. May be really crux lies in educating people rather than supporting baby bonuses.
A debate on demography can continue forever as more the population, greater the size of the armies and it matter more to countries which are under threat. Among the developed countries, Israel is the only country with fertility rate of 2.9, well above the replacement rate.
 
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