Japan is sprinting to avoid dire official projections for mid-century, rolling out a sweeping expansion of pro-natal policies over the past year.
Demographic Reckoning
Despite tens of billions of dollars in pro-natal measures and some of the world’s most generous parental leave policies, births have slid to historic lows.
Demographic data tracked through the first 10 months of 2025 suggests births have likely fallen below 670,000 in the country—a level not seen since records began in 1899, and tens of thousands fewer than even the government’s most pessimistic projections.
This has policymakers worried, with a former health minister warning the nation has until the end of the decade to reverse the trend. In 2024, the government committed an annual sum of 3.5 trillion yen (roughly $25 billion) to child-rearing support amid rising living costs and widespread complaints from women over societal inequalities unfavorable to new mothers.
Analysts have suggested these steps don’t go far enough and that deep structural change is needed.
Adding to the alarm over population decline—recently labeled the country’s “biggest problem” by Prime Minister Sanae Takaichi, is Japan’s rapidly aging society. Roughly 30 percent of the population is now over the age of 65, with the trend emptying many rural communities and contributing to labor shortages across several key industries.
Accelerated Child Support
This year, the national government expanded benefits aimed specifically at reducing the financial burden of raising children and supporting families through early life stages.
Under the government’s “Child and Child-rearing Support Acceleration Plan,” part of the larger kodomo mirai senryaku (Child Future Strategy), household support has been broadened to include a more inclusive child allowance, with income limits removed and payouts extended through school age.
The initiative also includes increased cash grants for higher-order births and expanded financial support for childcare services.
Child allowances are now provided at higher base levels for families with children—from birth through high school, and additional supplements have been introduced for families with a third child or more.
Cash supports aimed at easing early pregnancy and infant care expenses, including phased benefits for expectant parents, were also introduced in 2025 to reduce up-front childbirth costs.
Takashi Inoue, a demographer at Aoyama Gakuin University, believes the Child and Child-rearing Support Acceleration Plan is a “packaged approach” marking a strategic shift from supporting working mothers to encouraging youth marriage and childbirth through economic incentives.
The most notable pillar, he said, is its effort to increase income for the youth. “While Japan’s previous measures focused on creating environments where working women could more easily give birth and raise children, this initiative aims to encourage marriage and childbirth among young people from an economic perspective,” he told Newsweek. “It can be seen as a slight course correction in the direction of measures to address the declining birthrate.”
Work-Family Balance and Parental Leave Reforms
In addition to financial incentives, Japan moved forward this year with legislative changes to its leave and work-family balance framework.
On April 1, amendments to the Act on Childcare Leave and related caregiver provisions came into force, expanding options for flexible work and leave patterns to help employees better balance child-raising with career continuity.
Further phases of this reform took effect later in the year, aimed at normalizing the use of child care leave and reducing the penalties workers—particularly women—face for having children.
These legal adjustments complement longstanding efforts to expand parental leave uptake and provide alternatives such as staggered start times, remote work, and enhanced leave compensation during early child-raising periods.
Experts have described these changes as essential to breaking entrenched workplace cultures that have historically discouraged extended caregiving by either parent, particularly in male-dominated sectors.
The government has also prioritized child care access and quality. Local municipalities and the national Child and Family Agency have expanded daycare capacity, reduced waiting lists that long frustrated working parents, and improved staff-to-child ratios in early education settings.
Policies intended to make preschool more accessible regardless of parental employment status—including systems that allow parents to choose flexible scheduling—were phased in this year to relieve both economic and logistical pressures on young families.
Structural Headwinds
Despite these policy pushes, academics and demographic experts remain cautious about Japan’s ability to reverse its entrenched fertility decline.
“This is not simply about financial incentives,” said Masakazu Yamauchi, a demographer at Waseda University, told the Financial Times, noting that projections for 2025 still point toward continued declines in births despite expanded programs. He and other experts have urged policymakers to acknowledge that rising living costs, persistent gendered divisions of labor, and long-standing patterns of delayed marriage and childbirth cannot be solved by cash alone.
International research shows that while allowances and leave policies can help, their effectiveness diminishes when structural pressures prevent households from having more children.
Without corresponding shifts in work culture, especially greater normalization of paternal caregiving, and more integrated support for housing and career stability, experts say the expanded benefits are likely to have only a limited impact.
Inoue pointed out that Japanese pro-natal policies are already among “the world’s highest standards” and that additional measures are likely to achieve only limited success. “It’s a pessimistic view, but I must say it is difficult for government policy to change the marriage outlook of young people in modern Japan.”
The country is left with only two options, he said. One is to keep measures at their current level and hope Japan’s birth rate recovers on its own.
The other is to provide a childbirth allowance of approximately 10 million yen (about $64,000 per birth)—a 19-fold increase over the current allowance.
Japan in 2050
Looking ahead to mid-century, the population of 124 million will have fallen to 100 million, according to projections by Japan’s National Institute of Population and Social Security Research.
Meanwhile, the dependency ratio is projected to rise from 68.0 to 89.0. This means nearly one working-age person will be responsible for supporting one older adult or child, further weighing on the vitality of one of Asia’s largest economies.
AloJapan.com