Japan's birth rate has declined for the tenth consecutive year, and the population crisis is worsening!

Japan's number of births in 2025 has declined for the tenth consecutive year, further highlighting the country's increasingly heavy demographic pressure, while also posing a severe test for the effectiveness of the new government's policies to address the population crisis.

According to preliminary data released by Japan's Ministry of Health, Labour and Welfare on Thursday, the number of newborns in Japan in 2025 is expected to decrease by 2.1% year-on-year, falling to approximately 706,000. During the same period, the number of deaths in Japan slightly decreased by 0.8%, to about 1.6 million.

To address the population decline, Prime Minister Sanae Takaichi is attempting to promote a series of economic incentive measures that include tax reductions and childbirth subsidies. However, these proposals aimed at reducing the cost of raising children for families have not yet been officially implemented.

The continuing decline in the birth rate has intensified market concerns about Japan's long-term economic growth potential, and the government's distraction from population policies has led to questions about whether the urgency to reverse the birth rate has been downgraded on the national agenda.

Shift in Policy Focus Raises External Doubts

According to Bloomberg, Sanae Takaichi proposed several incentive measures before the Liberal Democratic Party leadership election in October last year, including tax reductions for hiring babysitters and domestic services, as well as corporate tax cuts for companies that establish in-house childcare centers. Additionally, as Japan's first female prime minister, she promised to introduce national qualifications for childcare workers and improve their pay and working conditions. At the opening ceremony of last week's parliamentary meeting, Takaichi stated that the government would alleviate costs associated with pregnancy and childbirth, but these policies have yet to be implemented.

Market and public concerns center on the possibility that the current government's policy focus may be shifting. Some believe that compared to previous administrations, the current Japanese government has turned its attention to national security and policies targeting foreigners. Former Prime Minister Fumio Kishida launched a childcare package plan worth 3.6 trillion yen (approximately 23.1 billion USD) in 2023, calling it "an unprecedented measure to address the declining birth rate," a stance that was later continued by Shigeru Ishiba.

Under Sanae Takaichi's leadership, child policy has been incorporated into a broader demographic agenda that includes policies regarding foreigners. The minister responsible for addressing the population decline, Hitoshi Kikawada, currently oversees 11 other portfolios, including territorial disputes and food safety, raising widespread doubts about whether the issue of the birth rate has been sidelined.

Historical Data Highlights Long-term Challenges

From a statistical perspective, the preliminary data released on Thursday covers a wide range, including babies born to foreign residents living in Japan and Japanese nationals living abroad.

In contrast, the narrower final data more accurately reflects Japan's domestic population challenges. The final data for 2024 only counts Japanese nationals residing in Japan, with the figure expected to be around 686,000, marking a historic low since records began in 1899. The final data for 2025 is typically officially released in September this year and is expected to further reveal the true depth of the population decline

Global Countries Intensify Fertility Incentives

In the attempt to reverse the decline in population structure, Japan is not alone; many major economies around the world are intensively launching various economic incentive policies.

In South Korea, which is also facing population pressure, data released on Wednesday showed that with the support of incentive measures aimed at reducing childcare costs, the country's fertility rate for 2025 has seen an increase for the second consecutive year as the number of marriages gradually recovers from a long-term slump.

Additionally, according to Bloomberg, U.S. President Trump has proposed a $5,000 baby bonus. Meanwhile, China also plans to provide an annual subsidy of 3,600 yuan (approximately $500) for children under three years old, attempting to alleviate the childcare burden on families through direct economic subsidies