Can frontier tech solve the problems  of Japan's declining population?

Population decline is one of Japan’s most significant issues – it has been falling since 2008 and is estimated to dip below 50 million by 2100.

Couple that with the country’s ageing population, the number of working-age people is expected to decline further to around half of the total population by 2060.

Since 2017, Fukuoka city has been promoting an initiative called Fukuoka 100 to create sustainable communities that utilize technology to prepare for the upcoming super-ageing society.

The Global Shapers Community’s Fukuoka hub in Japan held the Global Youth Social Entrepreneurship Summit in Fukuoka last August, in collaboration with several hubs, to explore population issues from the social entrepreneurship perspective.

The Fukuoka Hub also discussed with experts in automation, Web3 and the metaverse how the latest trends in these frontier technologies could help solve population problems, touching on automated driving and automation resolving inevitable labour shortages, using the metaverse to tackle social isolation and digital villages’ impact on the financial health of a community.

More and more Japanese are not getting licensed to drive and the number of driving licenses among Japanese youth saw a decline of more than 6.5 million over two decades. That might be due to an expanding and dependable transportation system and increasing transition towards telework. However, Japan needs drivers to move more than 70% of its freight.

Japan is usually the second in line to adopt new technology, if not the first. With automated driving around the corner, that might be the answer to the decreasing number of drivers in Japan. Level 3 automated driving – where driving is handled entirely by the driver who must be present for intervention requests – is already allowed on public roads in the country.

More than 50% of the costs associated with logistics occur during the last mile, also known as the last mile problem. Reasons include delayed innovation in the industry due to varying customer demands, unpredictability in transit, inefficient routing and lack of route optimization.

Solutions in automation are helping to decrease the time and cost required to do last-mile delivery. With last-mile deliveries expected to grow to 78% by 2030, more players are expected to enter the market. A group of companies are running pilots of contactless, automated deliveries in four major cities in Japan, funded by the Japanese Government’s New Energy and Industrial Technology Development Organization (NEDO).

While the population is decreasing, Japan also has the potential to become the laboratory of new solutions in automation that can be implemented in other parts of the world.

Web3 and the metaverse are other ways tech solutions are sought for social problems in Japan.

In December 2021, an NFT of the picture of the Nishikigoi carp (a kind of fish in Japan) was issued in Yamakoshi, a small village in Niigata prefecture with a population of 800. Holders of these NFTs are called “digital villagers” and are given the authority to execute part of the budget related to Yamakoshi.

As proposed by the digital villagers, a portion of the proceeds from the sale of the NFTs will be used to implement plans for the survival of the Yamakoshi area. The digital villagers will vote to decide which plan will proceed.

Yamakoshi Village used to have a demographic where 55% were over 65. Today, however, approximately 950 young digital villagers worldwide have joined the village, more than the number of actual residents. Yamakoshi is an example of a small Japanese village with an increasing digital-related population (“digital kankei jinko”) who are neither permanent residents nor tourists and are involved in the community through digital means.

Without relying on external subsidies, the village’s officials are trying to create a sustainable Yamakoshi by determining its financial future with residents and digital villagers.

According to a 2015 survey by the Cabinet Office, the estimated number of people in Japan aged 15 to 39 years old who are socially isolated is about 0.54 million. It means that one out of every 100 Japanese people feels social isolation and can’t form part of the labour force. The Ministry of Health, Labour and Welfare defines those who avoid social participation, including going to school, working and socializing, and who remain at home for six months or longer as a “hikikomori.”

Fukuoka prefecture has begun piloting employment support for the “hikikomori” using the metaverse. The city office staff and people suffering from hikikomori became avatars in an online mentoring session followed by an informal discussion. It led to an interactive session with young participants feeling less shy in the metaverse.

While the potential of these new technologies has been widely demonstrated, many challenges remain for Japan.

Japan is said to have a low capacity for innovation in terms of organizational structure, human resource development and entrepreneurship in response to the new digital age. However, signs of change exist, such as the Cabinet Office’s announcement of Society 5.0 as the ideal model for future Japanese society.

As technological developments continue to create new approaches to social issues, the challenge for the younger generation, such as Global Shapers Community Fukuoka Hub, will be to continuously create a space for discussion that breaches the boundaries of specialized expertise and transform these approaches into actual solutions.