Japan's population ages at a record pace, opening up potential challenges and opportunities

Japan’s elderly population has reached record highs according to a survey published last week.

There are now approximately 2.06 million people aged 90 and over in Japan, with figures topping 2 million for the first time.

The total number of ‘elderly’ people – i.e. those aged 65 or over – climbed to a record 35.13mn this year, accounting for 27.7% of the overall population.  This is the highest in the world, followed by Italy at 23% and Germany at 21.7%.

Data from the Internal Affairs Ministry also showed that the ‘elderly’ are making a growing contribution to the economy, making up 11.9% of employed people. This figure has increased 2.5 times since 2006. However, 39% of these are in nonregular employment.

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September edition of Business Review Asia 

As a result of these figures, some are calling for ‘elderly’ to be redefined. Indeed, a recent survey by Ratuken found that 72% of people in the 65-69 age bracket stated “I don’t consider myself an ‘elderly’ person” with 34% of those aged 75 and above also agreeing with this statement.

Such an increase in the elderly is both a challenge and an opportunity for Japan and Asia as a whole.

In Japan, demand has grown rapidly for the existing free ambulance service operated by municipal fire stations and funded by taxes. The Fire and Disaster Management Agency reports a 2.6% increase in the past year for ambulance requests.

This surges in the summer due to heat exhaustion and in winter due to flu season, both issues the elderly are an at-risk group for, but it also peaks at New Year with incidents of people choking on mochi (sticky rice cakes), which is an issue for 100 people per year in Tokyo alone. This is also said to primarily affect the elderly.

This increase is harming ambulance response times. In 2006, the average response time for an ambulance in Japan was 6 minutes. Ten years later, this reached 8 minutes 36 seconds.

 The number of over 65s in Asia is predicted to grow to 520mn in 2027. According to Deloitte, this will also generate a plethora of new business opportunities.

Chris Richardson, Deloitte Australia economist, has stated that: “Aging population may well be challenging to some nations, but they will also present some incredible business opportunities within those same nations… our analysis shows that aging will produce some very large winners a industry level, particularly in Asia.”

For example, it is expected that healthcare costs will rise faster than most other costs, but that the stretched government budget will mean the share of health-related costs funded by the taxpayer will fall.

This will leave room for private healthcare and technology companies to offer solutions for a huge gap in the market, ready for much more than just the drive-thru funeral service announced last week.