While foreigners make up just 3.4% of Japan’s population, the share has increased to a record high and a political backlash has been building—even as the country also grapples with rapidly aging demographics and the need to find new workers to sustain economic growth.

On Tuesday, the latest five-year population survey detailed how stark Japan’s situation is. As of October 2025, the total population, including foreign residents, was 22.9 million, down 2.5% from five years earlier. The prior census in 2020 showed a dip of 0.7%.

The number of Japanese nationals revealed an even steeper decline of 3.5% to 119.1 million, following a 1.4% drop in the 2020 count.

Meanwhile, foreign residents jumped 40% to a record high of 3.84 million, and permanent residents climbed 17% to 947,125.

Like other wealthy economies in Asia, Japan’s birth rate has been below the replacement level of 2.1 children per woman for decades, and the population has been in steady decline since around 2008.

At the same time, Japan is aging, and the percentage of people age 65 and older rose to 29.4% in 2025 from 28.5% in 2020. In fact, adult diapers have been outselling baby diapers since 2011.

The country is scrambling to find ways to encourage people to have more kids. For example, Tokyo’s metropolitan government launched a dating app to bring more couples together.

Tokyo also started a four-day workweek and partial leave policy for city workers to help those who are parents balance childcare and work.

By contrast, policies have turned more hostile when it comes to foreigners.

On Thursday, the Japanese government increased fees for permanent residency to $1,271 from $64 — a 2,000% jump that marks the largest increase in the country’s history. The cost for a five-year residence permit shot up to $475 from $38.

Japan also imposed more detailed requirements on income for permanent residents, who must now earn a minimum of $36,428 per year. And for the first time, applicants for permanent residency will be evaluated based on their Japanese language skills as well as their grasp of rules and customs.

On top of that, the government can revoke permanent residency for not meeting pension contribution obligations, failing to pay health insurance and taxes, and violating immigration law or the penal code.

The changes come as Prime Minister Sanae Takaichi has ushered in a more nationalist, right-wing stance.

On the global stage, that has meant taking a harder line against rivals like China and North Korea, while also bulking up Japan’s military.

Domestically, the pivot has translated to a crackdown on immigration and even tourism, drawing criticism that Takaichi is encouraging xenophobia. In July, the government hiked some tourist visa prices by more than 400%. 

In a post on X ahead of the government’s new residency rules, Takaichi said many permanent residents could not maintain independent livelihoods.

“The government recognizes that, with the increasing number of foreign residents, there are citizens who feel anxiety and a sense of unfairness, and is addressing this by making ‘foreign policy’ more ‘orderly’ so that both citizens and foreigners can live safely and securely,” she wrote.