Decline in Japan’s ultra-rich predicted amid shrinking population
The ultra-rich population in Japan is set to decrease by 1.8% over five years to 2027, according to the national news agency Kyodo. This downturn is predicted by the British real estate consulting firm, Knight Frank.
In a reflection of the country’s broader demographic downswing, data shows individuals in Japan with a net worth of US$30 million or more commonly known as Ultra-High-Net-Worth Individuals (UHNWI), will fall from 22,259 in 2022 to a projected 21,859 by 2027.
Knight Frank attributes this decline primarily to Japan’s shrinking population. Despite this, Japan is still expected to host the second-highest number of UHNWIs in Asia. The National Institute of Population and Social Security Research in Japan forecasts that the country’s population will decrease by 2.3% from 125 million in 2022 to 122 million by 2027.
The predictions for Asia-wide wealth tell a different story. UHNWI population is expected to rise by nearly 39.8% to about 210,000 in the next five years. The global UHNWI population, however, fell by 3.8% in 2022 from the prior year. A large portion of this group saw their wealth drop due to the rising inflation rates and increased interest rates.
Knight Frank points to Japan’s declining population as a key factor contributing to the decrease in the nation’s UHNWIs. However, Japan is still expected to possess the second-highest number of UHNWIs in Asia. On the other hand, the UHNWI population in Asia overall is anticipated to surge by nearly 39.8%.
In related news, not only the ultra-rich population is predicted to decline, but also the population of Japan as a whole is expected to decline significantly over the next few decades, with predictions that the total number will fall to 87 million by 2070, a 30% decrease from 2020 figures.
As the country is dealing with the challenges of an ageing population, this decrease suggests that the government will likely need to rely more on foreign workers in the coming years to compensate for the shrinking workforce. To read more click HERE.
