Many nations in the world have faced with many problems of their population growth. However, the dominant factor in the next society might expose these problems in more details, which most people might begin to pay attention deeper on these problems such as the rapid growth in the amount of older population and the rapid shrinking of the younger generation, with the threats of demographic development such as welfare effects, social conflicts and reducing workforce, etc. Therefore, the government in each nation should have more considerations on these problems before it is growing to be the unsolved problems.

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Recently, this phenomenon is spreading its effect to many nations in this globe. Specifically in Japan, there are many researches and figures which can be clearly shown that Japan are staying at the highest position of the middle age’s average and also leading in the decline of population growth. This scale of the problem in Japan is unprecedented for the world. Therefore, Japan could be an example for many nations that are facing the same crisis which could learn how to handle or find out any solutions or policies to cope with this problem.

In one effect, this change created many problems in Japan such as the declination of workforce, extra welfare burden and the lack of opportunities and chances for new generation. It is also includes the issue integration of young and old people in workplaces. Nevertheless, aging population has not had only drawbacks. On the other hand, it is the opportunities for many companies to invent any innovations which suit with middle aged and old age groups.

This essay consists of three sections. The first section will focus on two topics which comprised by increasing life expectancy and declining population in Japan. The second section of the essay will examine on shrinking population of working age and Japan’s health care service industry. The final section of the essay will present the opportunities opened up for business by population aging such as how to develop products, design, innovation and services for silver market customer that suitable for the elderly target groups.

Part I: Demographic changes and economic growth in Japan

To comprehend the demographic component that caused population aging that would be refer to stable populations. According to the graph that presents age-specific fertility and the figure of mortality rates remain stable over time, from this conclusion in a number of contribute to population aging that remain constant and eventually becomes time instant as well.

The report shows that in a global context, Japan’s ageing is remarkable for its pace. The country took only 24 years to transform from the elderly society, where the older population accounted for 7% from the total population to the elderly society, where it doubled of the share, according to UN definitions.” Source: World population prospects, 2008 Revision, United Nations.


The abstract foundation of a decreased form models applied in econometric studies are: (1) saving and investment in the life cycle model (2) age-specific modification in labour productivity. The reason why this theoretical is that important to focus on is people’s economic needs modulate at different the way of life and people’s behavior, the effect of economic performance that effects in a country’s age structure has been changed. By contrast, most of young people demand investment in education and health, adults contribute labour and savings, and the aged demand retirement income and health care. (Kohlbacher, Herstatt, 2008)

Life expectancy

Some people said that the experience of happiness could be changed in case of getting older. According to a research from 80 countries over the world shows a notably in a same pattern. Happiness is looks like a U-shaped curve, many people are happiest from the beginning until end of their lives. Most people reach at the bottom at age 44. At the lowest point of the graph, they will be stuck in this point until age 50 as long as their healthy, the level of their happiness will increase and the risk of depression will decline. This pattern is still the same even in rich or poor persons. (Moynagh and Worseley)

Furthermore, those people who born between 1925 to 1945 will count in the ranks of the extreme older age. This group has faced difficult improvements in their life expectancy over the past 40 years than earlier generations. However, the propellant of longer life will increase in the elderly following by changes in lifestyle such as less smoking, advances in medicine such as the use of antibiotics, environmental improvement such as living in the place that have less pollution and healthier diets such as eat more fibre.

Declining population in Japan

Japan is one of the most recently a rapid growing of aging country but low birth rate. In 2005, over the next several decades, the figure of people who aged over 64 will increase rapidly whereas the possibility of actual population has been declined. In Germany and Japan that facing the fertility rates that are far under the “replacement rate” wanted to maintain a steady population. Nowadays the number of birth rate in Japan and German y are approximately 2.1 children per woman. Assuming of authentic projections, which is the figure of fertility rate might be slowly revert to the replacement proportion in Japan. By contrast this figure could be remaining nearly to the recent level (1.4) in Germany. In fact, Assuming of German forecasts are durable but still declining of the immigration, which is approximately 2 immigrants per 1,000 residents within an annual, compared with 5.6 earlier from this decade. In Japan, the immigration is assumed to be negligible compared with Germany.


Part II: Effect of population aging on the country’s economy

According to the increasing number of Japan’s population aging that have many effects on their country such as decreasing of working age as the quantity of retirement has risen rapidly and one more reason that effect on this country is the quality of Japan’s health care service industry which is very important section for the elderly due to an increasing demand of the elderly therefore health care services will be necessary to prepare their equipments and services to deal with the rising number of older people from now on.

Shrinking population of working age

As Japan has explored, when a large amount of the population who is in a sector of retirement-planning years (34 percent are aged 40-64 versus 27 percent in the U.S.) the figure of saving rates can increase to levels that lower economic growth and consumption. In a situation known as “Ricardian equivalence” when budget deficits have fueled an increasing concern about Japan’s economic in the future, these caused ageing workforce due to respond to prepare their saving.

Never the less, most of countries, the numbers of retirement are probably to have an opposite effect. One OECD analysis found that in the industrial, the figure of saving rates world might be decreased approximately eight percent of GDP during the late 2020s. Especially in Japan, where the number of retirees depends on their personal savings to finance in their old age and these has also caused all companies that have to train new employees due to the increasing of retirement of aging people so far.


Japan’s health care service industry

This is the most pledge industry of the health care service industry because of a constantly growing customer base and many factors that followed by requiring among the elder people in health care services. Normally, the consumption on health care services of elder people who aged 70 and above are around three times those compared with their age average. Even if this effect on the aid from the health insurance plans, it is evident that the possible demand of elder people for health care services should rise with rising number of the elderly.

Furthermore, same as other quality services, the income flexibility of health care services is usually higher than to live together in unity. This means that most of elder people are willing to pay without considering for the quality further than quantity of the services. According to the statement, the health care service industry should produce only the good value services that most of people are willing to pay. On the other hand, the government with fewer considerations and fewer responses for the difference of the quality services legislated to fix the price for the health care services. This frequently according to ineffective resource allocations, incorporating the creation in black markets.

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Eventually, the condition of health care services is extremely arranged by two layers of arrangements. The first one is the arrangement on clinics and hospitals. The qualification of medical services staffs, nurses and doctors. Another condition is a process to apply to the health care services of the public health insurance. These conditions were primordially set for patient’s profits. However, sector fact are commonly used in subsist poor health care supplier for the protection. Consequently, they actually obviate in supply increased of capable health care services encounting with the potential require. If the conditions were removed, all of the health care services can be mushrooming substantially.

Part III, Opportunities opened up for business by population aging

Among of the problems that many nations have faced to including in Japan whereas there still have the opportunities for certain business to prevent many products, design, innovation and improve their services including the way to manage business to handle with changing consumer values and lifestyle of the elderly.

Developing products, design, innovation and services for silver market customer

According to the aging of industrialized, led by Japan, demand of the facilities of elderly people to help them manage everything in their life easier than common life. For this reasons, many companies in Japan are trying to find the methods, ideas and helpful facilities to create a new product for providing attractive and helpful solutions dealing with elderly people to very old consumers. This is a great chance for companies, commerce, manufacturers and service providers to develop their products for these aging groups. Until now, the figure of the elderly people are remain rising share in the total population, also a rise in life expectancy, products and services have been considered and researched so far for old age to support them lead their lives easier as an independent.

These problems have become important hardly contain any attention for a long time in the past and the elderly users rejected the common friendly solution because these solutions clearly created from the technology of handicapped and rehabilitation. Thus, developing the new innovative products should be covered for all age in a concept “design for all” however, all products should be thoroughly considered on safety and comfort especially for elderly age. From the idea as above, the new research project “Sentha” has prevented. Sentha is stand for Everyday Technology for Senior Households and it also start establishing to develop new product concepts and new approaches.

With the mission for the research, contributory observation for Sentha achieved quite fundamental importance. The advantage of Contributory observation has been sensitive including habitual, unreflective and everyday action. There is no accident that contributory observation which is regarded as the “royal road” area research due to the linguistic-interrogative methods such as interviews and group discussions which cannot be explored by a position to train one’s sights on things. Contributory observation is thus, different from an interview, sensitive and usable equipment for researching everyday life. Hand movement and motions that can go on in a completely routine manner, especially it can be a point of departure for one’s work. This can be a trick from spending life of an elderly people. For instance, a screwed-in light bulb as a darning mushroom which is illuminated from within for elderly age who cannot see well in dim light.

These are some hi-tech products and services in Japan that they created for the elderly which is dominated by nursing care, pharmaceuticals and medical equipment.

Intelligent toilets

In many Japanese hotels, the healthiness of defecations can be showed by this machine, variety of heat functions are set at the seat to push up elderly people in order to help them getting off the toilet easier. Now, with a co-operation of two large companies “Toto” and “Daiwa house” installed toilets for pensioners which is a concept for this mergence. These toilets are installed medical sugars that can measure blood pressure, body fat and blood sugar rates of the user. Including a built-in internet device that can email any healthy information directly to the doctor to ensure their health.


Carmakers have created intelligent cars with dashboards that have large numbers and letters to let the driver especially the elderly people see the dashboards easily. Moreover, this car is including accelerator and hand controls for the brake, and swiveling seats to make it easier when the driver want to get in and out.

Robot pets

It quite difficult to the elderly who want to have a pet therefore this is a high technology to create a robot pet that seems like a real pet which can be responded the owners with opening and closing its eyes and it also moving its tail as well. Furthermore, The Institute of Physical and Chemical Research in Japan has developed the robots which is working as a nurse that can help and lift the elderly up and help them out of bed.


Changing consumer values and lifestyle

Japan’s recent dynamic social environment, merged with economic globalization the development of information technology, mostly influences the diversification of people with their values and lifestyles. To be more precise, people become more liberal toward different ways of thinking therefore not only the internet and communication technology that infiltrate on people’s lifestyle and values but also the way that their communication styles and personal relations as well.

The important factors that affect in changing consumer values and lifestyles are the spread of epidemic. For instance, tainted food and avian flu and also disasters from other natural that cause greater concern for security and disease prevention. This enhanced concern encourages consumer for safe, healthy food also in other health-related goods. However, it would be difficult to analyze or specific factors to influence them to change their habits. These are mechanism of change in and diversification of values in Japan: awareness of health ,safety and prevention, will to learn, value seeking, generosity in differences, view of family and marriage

(Kohlbacher, Herstatt, 2008)

Marketing for the silver market

The demand of the older customers is very necessary in a market of retailing trade due to the possible of the best-agers is quite underestimated. This is varied target group, including the elderly who age over 50 years with the difference of socio-demographic characteristics, leisure time activities, value orientations and consumer preferences. In fact, these can be considered that, negligence of the specific interests and consumption habits of the elderly, in common they share the basic needs to provide themselves by retail shopping as long as they are able to do these activities. The report in German, the amount of the spending power of aging people is also attractive. Aging people between 50-59 years old spent approximately 24000 euro in the retail trade whereas those aged over 60 had 20000 euro in each year to spend. However, the implication of the demographic on retail trade affects the decision on the location of commercial establishments. Demanding of the elderly groups regarding comfort and convenience when they need shopping coincide with the target groups of younger people. Purchase outlets should be accessible includes the design of products that can make the consumer feel satisfied. (Kohlbacher, Herstatt, 2008)



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