Among the industrialized nations, Japan has been notably resistant to immigration. Only 2.3 million foreigners reside in the country of 126 million—less than 2 percent of the total population. (By contrast, about 13 percent of U.S. residents are thought to be foreign-born.) And in Japan, the vast majority of those foreign-born residents will never gain citizenship, either. Donald Trump’s efforts to curtail refugee admittance into the United States have drawn flak on a global scale; yet it has gone largely unremarked that as of last fall, Japan had accepted six—yes, six—Syrian refugees. The grand total of refugees it took from across the globe in 2016? 28. 28!
Obviously, there are normative questions here about the competing values of openness versus social solidarity, ethnic chauvinism versus a healthy reverence for the past and the strength of the group. And we can debate, for instance, how much Japan’s unbelievably low crime rate has to do with its refusal to permit widespread immigration.
But let’s set those matters aside. Because it is also often argued that Japan’s economy is suffering badly because of its failure to fling open its borders. Laignee Barron makes such a case at Quartz, where he writes about Japan’s “labor crisis.”
Barron points out that Japan’s population is shrinking; the country lost nearly a million people last year due to low birth rates and an increasingly geriatric—and therefore dying—population. “The unemployment rate may be joyously low at 2.8 percent, but the dwindling workforce chokes growth and forces businesses to take desperate moves, like resorting to ‘digging robots’ at construction sites,” Barron writes.
“Resorting to” is an odd construction, when it comes to employing robots. Indeed, automation can quite plainly improve economic productivity, because it takes fewer humans to produce the same amount of stuff. And it’s hardly a surprise that, given its demographics, Japan has become a pioneer in robotics technology. This is actually a sign of adaptability.
As for choking growth, there’s not much evidence of that. Japan is currently in the midst of its longest expansion in more than a decade. And any expansion, by the way, is impressive. As the Financial Times’ Robin Harding put it in a 2015 column, “Japan keeps entering ‘recessions’ because its population is falling and so the economy has little potential to grow. The Bank of Japan puts trend growth at 0.5 percent or less, compared with the U.S. Federal Reserve’s estimate of 2 percent for America. It is as if the U.S. is a couple of meters away from the swimming pool but Japan is walking along the edge and needs only a slight nudge to fall in.” That Japan is managing to eke out even 1 percent annual growth is hardly a sign of choking: It’s actually evidence of an economy holding its own.
There’s another point worth making. Yes, Japan is losing total population. But like the rest of the world, it is simultaneously urbanizing. Indeed, even while the country is losing people as a whole, Tokyo, in particular, continues to grow. (Last year it added another 77,000 residents.) Just as has occurred over recent decades in China and India, as older people in the hinterlands die out, their offspring have chosen to light out for the big city.
It’s a bizarre notion that new immigrants therefore, would “solve” Japan’s population crisis given that it is highly unlikely that they would settle in the rapidly depopulating countryside with dwindling prospects. (And in fact, if the new immigrants did settle in Tokyo, that wouldn’t necessarily be a good thing either: As anybody who has visited the Japanese capital recently can attest, it’s quite crowded enough already, thank you.)
Ultimately, the key question is this: What do immigrants add to an economy? In many cases, they provide a ready supply of low-skill, low-wage service and labor workers. But Japan is already responding its dearth of such laborers with robotics. Meanwhile, there just isn’t much demand for high-skilled immigrants to Japan, which is already one of the most highly educated societies on Earth.
In the long run, Japan’s declining population may create problems by putting severe stress on its entitlement system. Basically, at some point, there will be too few workers supporting too many retirees. Making matters worse—in one sense at least —is that the Japanese live longer than any other people on Earth. Not to mention that robots don’t pay taxes. Then again, neither do many low wage workers in advanced economies, who tend to earn too little to contribute meaningfully to a country’s tax base.
If Japan truly has a demographic crisis, it will have to solve it the old fashioned way: by getting busy.
