A sideways look at economics

Every year, on the second Monday of January, Japan grinds to a halt in order to celebrate thousands of young men and women entering adulthood. Coming of Age Day honours those that have turned 20 – the legal age for consuming alcohol, smoking, gambling and even attending ‘hostess bars’!

Much has changed since the ritual, initiated by a young prince over a thousand years ago, began.

Gone are the days of sword wielding and blackened teeth; the rite of passage is now marked by throngs of kimono-clad women and suited young men enjoying their newly gained freedom by spending a night on the tiles.

Times change, but values don’t.

This year’s cohort was born between April 1996 and April 1997. Since then, the value of per capita GDP has flatlined, while the benchmark Nikkei 225 stock market has fallen almost 10% and the Bank of Japan’s benchmark policy rate has declined from 0.5% to -0.1%. Japan’s period of stagnation has also come of age, but that’s no cause for celebration.

Attendance at the annual Coming of Age festivities has also halved since its peak in 1976, shining a spotlight on Japan’s demographic crisis. Today, over a quarter of Japan’s population is aged 65 or over. Before long, only one person in every two will be of working age.

With so many national indicators on the wrong track, who can blame Japan’s youth for indulging in a bit of escapism?