The number of foreign nationals living in Japan has hit a record high, according to official data released Wednesday that also showed the nation's largest-ever yearly drop in Japanese citizens.

With chronically low birth rates, Japan has the world's second-oldest population after tiny Monaco.

Prime Minister Fumio Kishida has introduced policies aimed at boosting births, warning the country is "on the verge of whether we can continue to function as a society".

The government has also been reviewing immigration policies to make moving to Japan more attractive to overseas workers.

As of January 1, there were 3.32 million foreign residents in the country, the figures showed.

That marks a surge of 11 percent on-year and a record high since the internal affairs ministry began logging the data in 2013.

Foreign nationals accounted for around 2.7 percent of Japan's total population of 124.9 million.

Japanese media attributed the rise to the end of pandemic-era border controls, which prompted the return of international students and workers taking part in the government's vocational training scheme.

The number of Japanese citizens residing in Japan, meanwhile, stood at 121.6 million, the data showed, with 2023's drop of 861,237 the biggest ever recorded and the 15th straight yearly decline.