The government said Friday that the swelling ranks of young people forced into part-time work could dent Japan's economic competitiveness as these workers have less opportunity to hone a particular skill.

In an annual national life report, the government also warned that the increase in lower-paid young workers could add fuel to the trend by Japanese to either marry later in life or remain single.

"This could exacerbate the declining birthrate and put a restraint on economic growth," says the report, titled "Deflation and Daily Life -- Young 'Freeters' at Present."