Tokyo ? Japan’s birth rate in 2005 dropped to a record low of 1.25 babies per woman, the Health Ministry reported Thursday, adding to concerns over the country’s aging population and its economy.

Japan also reported that for the first time on record, the number of deaths in 2005 exceeding births by 21,408.

The trend threatens to leave Japan with a labor shortage, erode the country’s tax base and strain the pension system as fewer taxpayers support an expanding elderly population.

The country’s birth rate was 1.29 in both 2003 and 2004, already the lowest figure since the government began releasing birth figures in 1947, according to the Health Ministry.

Accounting for infant mortality and other factors, fewer than 2.1 babies per Japanese woman represents negative population growth, with potentially dire consequences for the economy and the care of the elderly.

The number of births in Japan stood at 1,062,604 last year, down 48,117 from the previous year, statistics released by the ministry showed. The number of deaths totaled 1,084,012, up 55,410 from 2004.