Hello, this is Andy.
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Have you thought about whether you will continue living in your current home or neighborhood in the future?
Recently, I saw a news report that Japan's birthrate has dropped to 1.15, and that the population will begin to decline at an accelerated pace. I started wondering what kinds of changes that might bring and began reading books on the topic.
Previously, I had read “The Shock of 11 Million Worker Shortage,” so I had a rough idea of what might happen.
Still, what’s coming in the next 20 years looks quite serious... 😓
However, despite this looming demographic crisis, we rarely hear discussions about related issues—such as the infrastructure costs needed to maintain aging systems or past accidents caused by sewer pipe failures in the Kanto area.
Back when I was a corporate employee, we were constantly encouraged to "plan ahead, think three steps forward, and act accordingly."
But in the broader public, I don’t see that mindset reflected. News coverage tends to focus only on the immediate, short-term issues.
These days, I can’t help but wonder... Will Japan really be okay?
I do believe that Japan’s top bureaucrats are aware and thinking through the situation.
After all, population statistics are highly reliable and accurate for long-term forecasting.
Surely, they’ve done calculations—on what the population will be, how GDP and tax revenue will change, what infrastructure maintenance and social security costs will be, and so on.
Can We Prevent the Population Decline Now?
At this point, it seems nearly impossible. Japan’s population will continue to decline.
We will increasingly see rural areas where basic infrastructure, public services, and healthcare are no longer sustainable.
Two Major Phases of Population Decline
1. Until 2042:
While the number of young people decreases, the elderly population will keep increasing.
For the next 20 years or so, most policies will be consumed by addressing aging issues.
As a result, rising healthcare costs and social insurance premiums are inevitable.
Ask yourself: Are you visiting the hospital unnecessarily?
Have local clinics become social gathering places?
2. From 2043 onward:
Even the elderly population will start declining, while young people will continue to dwindle.
Population decline will accelerate, and nearly 40% of the total population will be elderly.
Regional Trends
Even the three major metropolitan areas will begin to decline. Compared to 2015:
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By 2045, the Kansai region is projected to see a population decrease of nearly 20%
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The Nagoya area: almost 10% decrease
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Tokyo: expected to maintain its population
"Dot-Type" Cities and Country
Population will concentrate in certain "dots" across the country.
Even within a prefecture, people will gather in the capital city.
In large cities, central areas will become more populated while the outskirts will empty out.
Reading this book was quite shocking. It painted a picture that still feels unbelievable.
It’s hard to accept—maybe because it doesn’t feel real yet.
Oddly enough, topics like rice prices or this year's cash handouts generate much more media attention.
It’s all so short-sighted...
My Approach
Because these demographic projections are statistically reliable, I plan to continue living in suburban areas of major cities.
With a projected 20% population drop (compared to 2015), both houses and apartments will likely become increasingly vacant.
In a way, we’ll be spoiled for choice. Rent prices will almost certainly decline.
My Biggest Concern: The Nankai Trough Earthquake
I believe this disaster could further accelerate Japan’s population decline.
Especially in western Japan—where damage is expected to be severe—many areas may not recover at all.
In that case, I believe it could lead to a mass sell-off of Japanese assets, triggering a triple hit:
weak yen, falling stock prices, and plummeting bond values.
Going forward, I plan to focus on U.S. dollars and prepare accordingly.
Of course, it doesn’t help to worry constantly, but as someone who values thinking ahead,
I’ve decided to remain in the suburbs of large cities.
After the Nankai Trough event—if and when it happens—I hope to offer what little help I can through volunteer work.
