Newborn babies in Japan have reached a ten-year low. The future labor shortage may expand.

The number of newborns in Japan has reached a record low for ten consecutive years. Under the increasing pressure of an aging and low birthrate society, the cabinet led by Prime Minister Yosuko Hashimoto has been urged to accelerate the promotion of social security system reforms to ensure that the pension and other welfare systems have sustainable financial resources. Moreover, the deepening of the population structure gap may lead to a further expansion of the labor shortage in Japan in the future.

Data released by the Japanese Ministry of Health on Thursday (February 26) showed that the number of newborn babies in Japan, including those born to foreign residents, decreased by 2.1% to 705,809 in 2025, representing a 30% drop over the past decade.

The data released this time makes it impossible for the authorities to be optimistic. The rate at which the number of newborns has decreased is much higher than the official expectations previously. The report released by the National Institute of Population and Social Security Research of Japan in 2023 had predicted that the number of newborns in Japan, including those born to foreign residents, would not drop to around 700,000 until 2042. Now, it has happened 17 years earlier.

The birth rate in the capital region of Japan accounts for 30% of the national total. The birth rate in the Tokyo area has risen slightly by 1.3% this time, marking the first increase in nine years. This is not only due to the increase in the number of newly married couples and the continuous inflow of population to the urban areas, but also because Tokyo's female governor, Koike Sakiko, launched the "Children First" subsidy last year, providing free childcare allowances for families with a second child.

After the high-level government took office, it also announced that it would start distributing a subsidy called "Child and Parental Allowance" in April, and would establish enterprise childcare centers and other measures. However, the minister in charge of addressing the issue of population decline also has to hold 11 other positions including territorial disputes and food safety. This has led the public to believe that the high-level government places less emphasis on promoting childbirth compared to previous administrations.

The Japanese government stated on Thursday that it is striving to build a stronger economy in order to alleviate the economic burden of raising children for dual-income families. Deputy Cabinet Secretary of Japan, Masahiro Takeda, said: "I believe we have achieved some success, but unfortunately, we have failed to reverse (the decline in the birth rate)… I believe (the key factor) is to achieve strong economic growth."

The Nikkei News reports that population decline is a global issue. The fertility rate of women in many countries is generally below 2.1, and they are also facing the situation where the demographic dividend has turned into a demographic burden.

Japan's pension system relies on contributions from the active labor force to function. If the birth rate remains persistently low and the reform of the social security system is not implemented promptly, the sustainability of Japan's pension system will face severe challenges.

Furthermore, the shortage of labor will also hinder economic growth. In the absence of being able to increase productivity through technologies such as artificial intelligence quickly, Japan must introduce more foreign workers to fill the gap. However, if the high-level government tightens its policies on foreign population, this will undoubtedly run counter to the need to alleviate the labor shortage.