\n
![](\"https:\/\/fortune.com\/img-assets\/wp-content\/uploads\/2024\/03\/GettyImages-640993432-e1711659867483.jpg?w=2048\")
<\/p>\n [ad_1]
\n<\/p>\n
A Japanese diaper maker will produce diapers exclusively for older adults amid a steep decline in demand for infant diapers, an ill-boding reminder of Japan\u2019s aging population.<\/p>\n
Oji Holdings, a Japanese paper product manufacturer, announced Monday that it would cease production of disposable diapers for children in September after plummeting demand.\u00a0The company\u2019s subsidiary Oji Nepia manufactures 400 million infant diapers annually, down from its 700 million peak in 2001, BBC reported<\/a>.<\/p>\n \u201cThe Group aims to transform its business portfolio by concentrating investments on businesses with high profitability and growth potential in order to increase corporate value,\u201d Oji Holdings said in a statement<\/a>. \u201cThe current termination of the domestic disposable diaper business for children is based on this strategy.\u201d<\/p>\n In the Japanese market, adult diaper sales have outpaced baby diaper sales since 2011<\/a> because of shifts in demand. Births in the country\u2014758,631\u2014were down 5.1% in 2023 from the year before, Japan\u2019s lowest number of births<\/a> since the 19th century. The country\u2019s low birth rate<\/a> is due to lower fertility rates, as well as a high cost of living and a corporate culture young prospective parents deem incompatible with raising children.<\/p>\n The demographic changes pushed Unicharm Corp., Japan\u2019s largest diaper producer, to make the same decision to shift to exclusively making adult diapers in 2012, Bloomberg reported<\/a>. It was part of a larger pivot of Japanese companies marketing to older shoppers, who tend to spend more money. In 2011, Japanese people in their 60s accounted for 40%<\/a> of the country\u2019s consumption.\u00a0\u00a0<\/p>\n \u201cThe elderly are going to be the engine of consumption,\u201d Shohei Murai, executive vice president of supermarket operator Aeon Co. said after Unicharm\u2019s announcement.<\/p>\n A shrinking workforce<\/strong><\/p>\n But Oji Holdings\u2019 decision to tap into a powerful aging consumer base is a small silver lining for Japan\u2019s cloudy and gray economy\u2014and graying population.\u00a0<\/p>\n Over 10% of Japan\u2019s population is aged 80 or older as of September 2023, per the World Economic Forum<\/a>, and it\u2019s expected to shrink a quarter by 2060, the International Monetary Fund<\/a> predicts. In 2023, the country\u2019s population of 125.4 million fell by 800,000.<\/p>\n That\u2019s bad news for Japan\u2019s workforce, almost half of which is over 70<\/a>, the World Economic Forum reported in 2022. A dwindling population means growing labor shortages on the horizon, including in the elderly care sector, which is predicted to increase threefold<\/a> to 690,000 by 2040, according to Japan\u2019s \u200b\u200bMinistry of Health, Labour and Welfare. Though Japan\u2019s job-to-applicant ratio<\/a> rose to 1.28\u2014128 job openings per 100 employee prospects\u2014the rate dwindled from the pre-pandemic rate of 1.6.<\/p>\n \u201cJapan is standing on the verge of whether we can continue to function as a society,\u201d Japanese Prime Minister Fumio Kishida said in January 2023 policy address to lawmakers<\/a>. \u201cFocusing attention on policies regarding children and child-rearing is an issue that cannot wait and cannot be postponed.\u201d<\/p>\n<\/div>\nSubscribe to the new Fortune CEO Weekly Europe newsletter to get corner office insights on the biggest business stories in Europe. Sign up<\/a> for free.<\/div>\n