What to avoid in a phase of population decline.

新潟県長岡市 アパレル衣類修整のプロ集団 山田修整有限会社
What should be avoided in a phase of population decline?

I am Yoshida, president of Yamada Shusei Ltd., a professional apparel clothing repair group in Nagaoka City, Niigata Prefecture.


Japan's population is expected to peak at 126.15 million in 2020, after which it will begin to decline, reaching 87 million in 2070. The population is also ageing, with the proportion of people aged 65 and over estimated to rise from 28.6% in 2020 to 38.7% in 2070. What should be avoided in this phase of life?



Population decline is likely to have a negative impact on the Japanese economy.

On the demand side, this will lead to a shrinking domestic market and lower consumer confidence, while on the supply side, labour shortages and lower productivity will occur.

These factors may reduce the rate of economic growth and also affect price levels. 


The impact of population decline on price levels is not uniform and is said to include both deflationary and inflationary factors, although it is likely that inflationary factors will prevail in the future.

This is because the more the population declines, the stronger the demand-side and supply-side cost-increasing factors become, and the higher the expectations of higher prices.


Therefore, in a phase of declining population in Japan, 'competing on costs and lowering prices' should be avoided. This is because not only will lowering prices reduce profit margins, but going against the trend of rising prices may also reduce customers' willingness to buy.


It is important to increase customer satisfaction by offering value-added products and services, rather than by lowering prices.