Working Better with Age: Japan

image of Working Better with Age: Japan

Currently, Japan has the highest old-age dependency ratio of all OECD countries, with a ratio in 2017 of over 50 persons aged 65 and above for every 100 persons aged 20 to 64. This ratio is projected to rise to 79 per hundred in 2050. The rapid population ageing in Japan is a major challenge for achieving further increases in living standards and ensuring the financial sustainability of public social expenditure. However, with the right policies in place, there is an opportunity to cope with this challenge by extending working lives and making better use of older workers' knowledge and skills. This report investigates policy issues and discusses actions to retain and incentivise the elderly to work more by further reforming retirement policies and seniority-wages, investing in skills to improve productivity and keeping up with labour market changes through training policy, and ensuring good working conditions for better health with tackling long-hours working culture.



Better job quality for longer working lives in Japan

Job quality is a key determinant of well-being for older workers and plays an important role in their decision to continue working or return to work. However, by international standards, Japan performs less well in terms of the quality of working conditions. A comparatively high share of workers experience job stain and suffer from excessive long hours of work, which can have a negative impact on their health. Under the Japanese employment system, many older workers face a substantial pay cut following mandatory retirement and may end up being rehired in jobs that do not fully utilise their skills, which undermines their job satisfaction, well-being and productivity. Measures which could be taken to improve job quality include: tackling labour market segmentation; eliminating excessive hours of work; better age management practices to utilise more fully the skills older workers and improve work-life balance; greater opportunities for self‑employment; and better data on working conditions to provide the evidence‑base for effective policies.



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