Demographic security

COMMENTARY: Demographic time bomb could hit America

In 2017, the United States saw the fewest babies born in 30 years, a stat that produced a lot of hand-wringing.

But it turns out things could be worse -- a lot worse. We could be Japan, whose unfolding demographic crisis provides some lessons for where America might be headed.

According to a new report from the Japanese government, Japanese women had 921,000 babies in 2018. That’s the fewest births since comparable records began in 1899 -- when the country’s population was a third its current size.

Meanwhile, deaths in Japan hit their highest level in nearly a century. Put together, that means the country’s population is shrinking rapidly, experiencing its largest natural decline on record.

Why does this matter? Well, it’s hard for an economy to grow with fewer workers. And as more people age out of the workforce, a swelling number of retirees must depend on a shrinking number of working people to power the economy. The tax base required to fund public services for those retirees -- including health care and elder care -- also shrinks.

The reasons for Japan’s baby bust are multifold. Some are specific to Japanese culture. Others bode ill for countries such as ours.

One factor is that Japan has actually been aging for a long time, and the share of childbearing-age women in the population has been shrinking. But even within that group of childbearing-age women, fertility rates are still low.