With a population of nearly 36 million people, the Greater Tokyo Area is one of the most concentrated regions in the world and the hotbed of business activity in Japan, posing a problem for a nation already struggling to keep population from further shrinking.

Half of Japan’s 3,500 listed companies are headquartered in Tokyo, packing the capital with over 30 million people and leaving rural areas depopulated. The congestion makes Tokyo one of the more expensive places to raise a family.

The birth rate in Tokyo is the lowest among Japan’s 47 prefectures, with women projected to bear 1.09 children, compared with the national average of 1.41.

“The population problem has been made worse by the over-concentration in Tokyo,” said Hiroya Masuda, the main author of a report published by the Japan Policy Council.

“Young people become unable to marry when they move to Tokyo, where everything is expensive, nurseries are in short supply, and houses are too small.”

The same report projected that population in half of Japan’s 1,800 towns and cities will see a downward spiral by 2040, as reported by the Wall Street Journal.

There may be a solution: move the multitude of large corporations out of Tokyo.

One example is Komatsu Ltd which recently began moving some headquarters functions to its home town of Komatsu City in Ishikawa Prefecture on the Japan Sea coast.

The heavy equipment supplier said it made the move after discovering big differences in birth rates between female workers in Ishikawa and Tokyo.

Female employees who work in Ishikawa have more children than those who work in Tokyo, said Komatsu senior adviser Masahiro Sakane. In addition to lower expenses, many employees have parents who live nearby and can ask them to help with child rearing.

By Maesie Bertumen

Image: Bunny Bissoux