(Bloomberg) -- Tokyo's population shrank last year for the first time in a quarter century, as more businesses turned to remote work amid the pandemic.
The population of Japan's capital dropped by about 48,600 people to just under 14 million at the start of 2022, the first decline since 1996, the metropolitan government reported Monday.
Japan has been trying for years to revive its regional economies and stop Tokyo from gobbling up more and more of the nation's shrinking population. Now, the coronavirus appears to have done what no government policy could: stem the flow of people into the crowded city.
As the pandemic heads into its third year, shifting attitudes about remote work are one reason for the change. Another is companies like Pasona Group Inc., the staffing and placement services giant, which in 2020 announced it would decentralize its headquarter functions away from Tokyo.
Japan's capital has been hit with high infection numbers and on-again-off-again restrictions on activity that have made life in the city less attractive and been particularly hard on restaurants and other service businesses.
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Quasi-emergencies were declared this month for Tokyo and regions covering most of Japan's other major economic hubs amid record virus cases.
Japanese businesses have tended to see a benefit in doing business face-to-face, but increasing numbers of them are experimenting with remote work. A recent Cabinet Office survey showed that 55% of companies in Tokyo's 23 wards have tried the practice.
At Yahoo Japan Corp., which is headquartered in the capital, some 90% of the company's 8,000 employees are now working remotely, according to President Kentaro Kawabe.
That's probably on the extreme end of the spectrum, but analyst Takashi Otsuka at Mitsubishi UFJ Research and Consulting says more people in their twenties and thirties may want to live outside the capital, where it's less expensive and there's more room to spread out.
“Teleworking could take hold to some extent” even after the pandemic, Otsuka said.
Megu Tsuchimura is representative of this shift. Last summer, the 28-year-old moved backed to her hometown, a village near the Japan Sea, after switching to an environmentally-focused startup that promised more flexibility. It's another business headquartered in Tokyo, but this time remote work is allowed.
“I was stressed-out, commuting on a jam-packed train in the middle of the pandemic,” she said. “I feel a lot happier now.”
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