JAKARTA — Japan’s shrinking workforce is a stark warning to the world that migration alone cannot fix the economic pressures created by ageing populations, a new study finds.

A fresh analysis from the London-based Centre for Economic Policy Research (CEPR), linked to the European Bank for Reconstruction and Development’s Transition Report 2025–26, uses UN World Population Prospects data to model future scenarios.

It finds that countries need massive inflows just to keep their working-age populations stable through 2050. Emerging European nations require 0.5% to 0.9% of their population per year even under “ideal” guest-worker assumptions, where migrants work but do not stay long-term. Slovenia would need 1.7%, while Italy, Spain, and South Korea exceed 2% annually.

“Policy responses to demographic decline will therefore need to incorporate other measures (such as extending working lives and boosting productivity) if they are to be effective,” the researchers argue.

Japan’s worker shortage has been building since the 1990s, becoming structural in the 2000s and turning into a full-blown national issue by the mid-2010s.

That pressure pushed Japan to bring in more foreign workers through schemes like the Technical Intern Training Program (TITP) and, later, the Specified Skilled Worker (SSW) visa in 2019. 

But after years of criticism and abuse cases, Japan will abolish the controversial TITP in 2027 and replace it with the new Employment for Skill Development (ESD) system.

Japan’s Ministry of Justice says the ESD system is designed to “develop human resources with skills at the level of Specified Skilled Worker (SSW) through employment for three years in Japan in the ESD industrial fields.”

But even as Japan opens new labor pathways, anti-migrant rhetoric has been rising at home, fueled by far-right groups campaigning against foreign workers. 

Sanseito, often branded in English as the “Japan First” movement, has become one of the loudest voices in this space. The party — compared by some Western outlets to a “mini-Trump” movement — made a surprise breakthrough last summer when it won 14 Upper House seats.