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Shrinking Japan wants more babies by dangling financial carrots - will couples bite?

Raising the child allowance age cap from 15 to 18 and a larger monthly allowance for a third child will be a big help, they say, referring to the measures announced on Wednesday. The Shigenos, who live in Tokyo, also say they stand to benefit from more time off from their employers and expanded childcare services.

Jun Shigeno, a systems engineer, said he and his wife – both 25 – hope that childbirth services would be free eventually. The proposed measure is under discussion but not included in the new legislation.

The average cost of medical care associated with having a baby could range between 503,000 yen (US$3,233) and 605,000 yen in Japan, according to some estimates.

“That would be huge for us because we want at least two children and probably three,” said Jun Shigeno. “I have two brothers and that is a large family in Japan, but that’s what I want for my family as well. If the government can make having a baby free, then that will make having a third child much easier for us.”

He told This Week in Asia that his friends who are getting married and planning to have children worry most about the cost of living.

“I know there will be even greater pressure on me when we have children as Nagisa will probably leave her job, which puts more pressure on me. Anything the government can do to help will be important to us.”

Japan’s shrinking population is fast becoming a crisis. Statistics released by the health ministry on Wednesday show that the nation’s fertility rate – the average number of children born to a woman – fell to a record low of 1.20 in 2023 from 1.26 in 2022, a decline for an eighth consecutive year.

In Tokyo, the rate dropped to 0.99, below the threshold of one for the first time.

The number of babies born in the