Osaka – Sunday, August 15, 2010
Nikkei, Japanese newspaper specialized in business and economy, reported in their special article about emerging new retirement concept of baby boomers in rapidly aging society of Japan. One of the trigger is the fact that the age people can start receiving a part of their welfare pension insurance is to be raised from 60 to 61 in 2013, as the first step of gradual rise to 65 by 2025.
The official retirement age in Japan is 60, and it means that people currently below 57 years old will temporarily lose means of income unless their employment is extended. Also, leveraging people over 60 is vital for the economy and the society of Japan when it is estimated that in 2025 two people of the generation still working is to support one elderly citizen.
1. How Japan is an aging society?
1) Japan is already a super aged society
Japan is already a super aged society, with 23% of its population being over 65 years old. This is because according to categorization, it is aging society if the ratio of population over 65 years old is over 7%, aged society if it is over 14%, and super aged society if it is over 21%.
Moreover, in a few years, baby boomers will reach 65 years or older to join elderly citizen and according to the estimation by the UN the percentage of the elderly (i.e. people above 65 years old) is to be over 30%. This is more than 18% of the U.S., 22% of France and 25% of Germany. Thus, Japan is to face a super aged society that no other countries in the world have experienced.
2) Japan is to face decreasing population and shortage of labour
In super aging society, Japan is to face decrease in population and shortage of labour. It is estimated that in 2025 the population will be 119 million, which is minus 7.9 million from the current 127 million. On the other hand, labour population (people whose age is 15 – 64) that supports the country’s economy is to decrease by 10.3 million. This means that potential economic growth will further decrease.
3) Social security benefit cost will expand
With slowing down/decrease in economic growth meaning less income, social security benefit cost will reach 141 billion yen in 2025, which is a drastic increase from 98 billion yen in 2009. Therefore, managing to pay cost for pension, healthcare and nursing care is a critical challenge for Japan.
2. How some companies and organizations started to adapt to super aged society?
1) Re-employment
In April 2010, Honda implemented a system in which in principle the company re-employs all retired workers (60 years old) who would like to continue working until they reach the age of 65, with the stance of “eliminate anxiety of employees when we are to face 2013, the start of year without pension benefit.” And the company already has re-employed 90 employees out of 228 retired workers.
This is an evolutional system because only 40% of companies allow, upon their request, retirement employees to continue working, when including business owners, 70% men of 60-64 years old and 40% women of 60-64 years old work already.
2) Employing people over 60 years old exclusively
A manufacturer located in Gifu prefecture that produces parts and components for consumer electronics been recruiting people over 60 years old exclusively. They do so by recruiting with the catch copy of “we are looking for motivated people, but the candidate must be over 60 years old”, and recently hired 8 new people. For this reason, half of their 90 employees are what is called “silver human resources” who are over 60 years old. The objective is minimizing personnel cost while improving factory operating ratio at weekends and holidays.
3) New working system for engineers over 60 years old
A manufacturer located in Chiba prefecture that produces components of construction machinery implemented a flexible working system for engineers over 60 years old. The target engineers can work from 3 hours a day and from 3 days a week. The reason for hiring senior employees is the necessity of smoothing out and balancing optimum employment. They had 50 veteran engineer at the peak but now only 16 with the worldwide recession. The company plans to call back engineers who used to work for them.
4) Nursing assistance volunteer system
A city in Tokyo implemented a nursing assistance volunteer system in 2007. In a case of a 72 year old man who leverages this system, he volunteers 2 days a week, helping with house cleaning, washing dishes and serving trays. He acquires 1000 points for 10 duties and can save up to 5000 points a year. He can utilize the point (1 point = 1 yen) for premium for nursing-care insurance.
A professor comments that this kind of system contributes to acquiring caregivers and decreasing insurance cost if network of elders expands. Since the implementation in 2000, premium for nursing-care insurance increased by 40%. People who are certified as being in need of care above 65 years old is already as many as 4.7 million people and caregiver is chronically insufficient.
2010年8月15日日曜日
2010年5月23日日曜日
Can Shopping Refugees Be A New Business Chance?
Osaka – Sunday, May 23, 2010
A recent popular morning TV news programme in Japan reported on a new social issue of “Shopping Refugee”. This is as a result of aging society, nuclear family and strategy/M&A of retailers (supermarkets). Possible new products and services could help shopping refugees if they can afford such new products and services.
1. What are “shopping refugees”?
Shopping refugees are those people who are forced to do shopping at large supermarkets that are far to go on foot instead of local shopping areas which are only a few minutes walk. Most shopping refugees are elders living alone (i.e. not with their children) in not scarcely-populated regions but in comparatively large cities of local region.
2. What is the traditional shopping style vs. new shopping styles of younger generation in Japan?
1) Traditional shopping style of today’s elders
Japanese people used to shop almost daily at nearby shops of groceries, greengrocers, fish and meat shop etc. and/or local small supermarket in local shopping areas on foot. Typical housewives used to do all her housework in the day and decide what to cook for dinner (evening meal) and go shopping on foot then cook. Elders today are used to this shopping style.
2) New shopping styles of younger generation
There are varieties of styles, with diverse lifestyle of younger generation. Some people shop in traditional style, similarly to how their mother and grand mothers used to. Some others position shopping as their leisure and shop during day time. Some others, especially people who work, shop at late evening. And some others mostly shop at weekends, buying foods for an entire upcoming week.
Depending on where they shop, some people walk to the supermarket, some go by bus and some drive to shop.
3. What are the factors for then change in shopping styles and emergence of shopping refugees?
1) Large retailers/supermarkets and their M&A
In line with economic growth of Japan, large supermarkets such as Daiei, Aeon, Jusco and Saty emerged and expanded their business aggressively nationwide. This completely changed the retailing industry map in Japan and also the places where majority of the population do shopping.
Such large supermarkets first opened their shops in city centre such as shopping mall in the front of the stations then to shopping area of residential area which housewives still could go on foot. A few such supermarkets now are open until late at night (e.g. 22:00 and even 24:00 for some) to meet their customer needs of today. Then, many large ones opened in suburbs which the transportation would be car.
Together with low birthrate meaning decrease in total population, retailing industry became saturated, leading to restructuring and M&A of the industry and each retailers. This has resulted in closing of supermarkets in shopping area in cities higher proportion of large ones in suburbs.
2) Nuclear family
In line with economic growth, more people stopped living with their parents (elders) after marriage and nuclear family became pervasive. There are many reasons and backgrounds to this, such as less jobs are available local regions, more people working companies that operates nationwide and/or worldwide meaning more people are re-located, change in values and attitudes in majority of Japanese people to name just a few.
3) Aging society
Attributing to low birth rate, Japan has become one of the countries suffering from severe aging society. And together with pervasive nuclear family mentioned above, this resulted in many elders living alone, forced to look after themselves, including daily shopping.
4) Car society
In line with economic growth, car became popular, and going shopping by car became popular for some families, both in large cities where there are good public transportation and local regions where car is the only transportation for families.
5) Working women and mothers
With economic growth then recession of the last 2 decades, and introduction of “Equal Opportunities for Both Men and Women” started in 1985, females started to continue working after marriage and even after having children, although proportion still remains low compared to western countries. Many such working mothers were forced to do shopping at weekends for successful time management, and even full time housewives became more flexible in their shopping style.
4. What is the case of Takaoka City in Toyama Prefecture introduced in the TV programme?
1) Shopping refugees
Examples of shopping refugees introduced in the TV programme were all elders living alone or with her husband but not living with their children. They used to enjoy shopping everyday to nearby shopping area within five minutes walk from their house.
However, with recent closing of the shops they used to go for shopping everyday, they now need to go shopping by bus to supermarkets which are 1.5km to 2.0km from their house. This is a burden for them, in terms of both physically (catching bus and getting on and off the bus) and financially (bus fee).
This was not mentioned in the TV programme but the author assume that the shopping refugees would also miss the communication they had everyday with the local shop owners and staff members during shopping. The local shopping area had been one of the important local community and shopping refugees would no longer benefit of such community and daily warm interaction.
2) Change in Takaoka shopping environment
First, large retailer of Daiei opened in the front of the station, then Saty, another larger retailer opened its supermarket in more residential area, attracting big pie of the shopping population.
Then, Aeon opened a huge supermarket with large car parks in suburb, which attracted shoppers that used to go to Daiei and Saty, so Daiei closed its supermarket. Saty was acquired by Aeon. Opening of Aeon’s huge supermarket led to closing the traditional shops in the shopping area of that shopping refugees used to go as well.
5. What are possible solutions to save shopping refugees?
1) New delivery service
Delivering supermarket products for shopping refugees can be a possible solution. According to the TV programme, a NPO started to help shopping refugees by delivering what they bought from Aeon.
From this, the author sees a great business opportunity for Aeon. They could start a new delivery service for their customers including shopping refugees and other customer segments who need such services.
Also, the author thinks that similar service can be provided by others such as gasoline stations that are having difficulties for survival, convenience stores, and delivery service companies including JP Service as their new business.
Another possibility of provider of this kind of service is a versatile service provider. A self-employed business owner near the author’s house provide varieties of services requested by his customers as long as he can provide (such as repairing things, doing housework, taking dog for a walk, MC of wedding and other ceremonies to name just a few) and he also will do shopping on behalf of his customer per request.
2) New product
New product meeting shopping refugees is another possible solution. For example, ingredients for breakfast, lunch and evening meal can be a new product as a substitute and delivered everyday to the shopping refugees and other households per request. This new business has actually been proposed and started, first targeting busy working mothers, which can be targeted to shopping refugees.
6. What are the author’s thoughts to conclude?
Changes in shopping environment are unavoidable, and together with many other factors, shopping refugees are unavoidable but can be a great business opportunity for many companies and business owners, by creating new businesses (products and services). However, whether such new businesses truly solve problems of the shopping refugees depends on their financial affordability and whether they can continue to enjoy interaction with the local community.
A recent popular morning TV news programme in Japan reported on a new social issue of “Shopping Refugee”. This is as a result of aging society, nuclear family and strategy/M&A of retailers (supermarkets). Possible new products and services could help shopping refugees if they can afford such new products and services.
1. What are “shopping refugees”?
Shopping refugees are those people who are forced to do shopping at large supermarkets that are far to go on foot instead of local shopping areas which are only a few minutes walk. Most shopping refugees are elders living alone (i.e. not with their children) in not scarcely-populated regions but in comparatively large cities of local region.
2. What is the traditional shopping style vs. new shopping styles of younger generation in Japan?
1) Traditional shopping style of today’s elders
Japanese people used to shop almost daily at nearby shops of groceries, greengrocers, fish and meat shop etc. and/or local small supermarket in local shopping areas on foot. Typical housewives used to do all her housework in the day and decide what to cook for dinner (evening meal) and go shopping on foot then cook. Elders today are used to this shopping style.
2) New shopping styles of younger generation
There are varieties of styles, with diverse lifestyle of younger generation. Some people shop in traditional style, similarly to how their mother and grand mothers used to. Some others position shopping as their leisure and shop during day time. Some others, especially people who work, shop at late evening. And some others mostly shop at weekends, buying foods for an entire upcoming week.
Depending on where they shop, some people walk to the supermarket, some go by bus and some drive to shop.
3. What are the factors for then change in shopping styles and emergence of shopping refugees?
1) Large retailers/supermarkets and their M&A
In line with economic growth of Japan, large supermarkets such as Daiei, Aeon, Jusco and Saty emerged and expanded their business aggressively nationwide. This completely changed the retailing industry map in Japan and also the places where majority of the population do shopping.
Such large supermarkets first opened their shops in city centre such as shopping mall in the front of the stations then to shopping area of residential area which housewives still could go on foot. A few such supermarkets now are open until late at night (e.g. 22:00 and even 24:00 for some) to meet their customer needs of today. Then, many large ones opened in suburbs which the transportation would be car.
Together with low birthrate meaning decrease in total population, retailing industry became saturated, leading to restructuring and M&A of the industry and each retailers. This has resulted in closing of supermarkets in shopping area in cities higher proportion of large ones in suburbs.
2) Nuclear family
In line with economic growth, more people stopped living with their parents (elders) after marriage and nuclear family became pervasive. There are many reasons and backgrounds to this, such as less jobs are available local regions, more people working companies that operates nationwide and/or worldwide meaning more people are re-located, change in values and attitudes in majority of Japanese people to name just a few.
3) Aging society
Attributing to low birth rate, Japan has become one of the countries suffering from severe aging society. And together with pervasive nuclear family mentioned above, this resulted in many elders living alone, forced to look after themselves, including daily shopping.
4) Car society
In line with economic growth, car became popular, and going shopping by car became popular for some families, both in large cities where there are good public transportation and local regions where car is the only transportation for families.
5) Working women and mothers
With economic growth then recession of the last 2 decades, and introduction of “Equal Opportunities for Both Men and Women” started in 1985, females started to continue working after marriage and even after having children, although proportion still remains low compared to western countries. Many such working mothers were forced to do shopping at weekends for successful time management, and even full time housewives became more flexible in their shopping style.
4. What is the case of Takaoka City in Toyama Prefecture introduced in the TV programme?
1) Shopping refugees
Examples of shopping refugees introduced in the TV programme were all elders living alone or with her husband but not living with their children. They used to enjoy shopping everyday to nearby shopping area within five minutes walk from their house.
However, with recent closing of the shops they used to go for shopping everyday, they now need to go shopping by bus to supermarkets which are 1.5km to 2.0km from their house. This is a burden for them, in terms of both physically (catching bus and getting on and off the bus) and financially (bus fee).
This was not mentioned in the TV programme but the author assume that the shopping refugees would also miss the communication they had everyday with the local shop owners and staff members during shopping. The local shopping area had been one of the important local community and shopping refugees would no longer benefit of such community and daily warm interaction.
2) Change in Takaoka shopping environment
First, large retailer of Daiei opened in the front of the station, then Saty, another larger retailer opened its supermarket in more residential area, attracting big pie of the shopping population.
Then, Aeon opened a huge supermarket with large car parks in suburb, which attracted shoppers that used to go to Daiei and Saty, so Daiei closed its supermarket. Saty was acquired by Aeon. Opening of Aeon’s huge supermarket led to closing the traditional shops in the shopping area of that shopping refugees used to go as well.
5. What are possible solutions to save shopping refugees?
1) New delivery service
Delivering supermarket products for shopping refugees can be a possible solution. According to the TV programme, a NPO started to help shopping refugees by delivering what they bought from Aeon.
From this, the author sees a great business opportunity for Aeon. They could start a new delivery service for their customers including shopping refugees and other customer segments who need such services.
Also, the author thinks that similar service can be provided by others such as gasoline stations that are having difficulties for survival, convenience stores, and delivery service companies including JP Service as their new business.
Another possibility of provider of this kind of service is a versatile service provider. A self-employed business owner near the author’s house provide varieties of services requested by his customers as long as he can provide (such as repairing things, doing housework, taking dog for a walk, MC of wedding and other ceremonies to name just a few) and he also will do shopping on behalf of his customer per request.
2) New product
New product meeting shopping refugees is another possible solution. For example, ingredients for breakfast, lunch and evening meal can be a new product as a substitute and delivered everyday to the shopping refugees and other households per request. This new business has actually been proposed and started, first targeting busy working mothers, which can be targeted to shopping refugees.
6. What are the author’s thoughts to conclude?
Changes in shopping environment are unavoidable, and together with many other factors, shopping refugees are unavoidable but can be a great business opportunity for many companies and business owners, by creating new businesses (products and services). However, whether such new businesses truly solve problems of the shopping refugees depends on their financial affordability and whether they can continue to enjoy interaction with the local community.
2010年4月4日日曜日
Will Reuse of Old School Buildings Save Japan?
Osaka – Sunday, April 4, 2010
In a recent evening TV news programme, how reuse of facilities such as school buildings started to be implemented was featured. This kind of reuse if revolutionary in Japan where they tend to rebuild facilities and houses rather than recycle and reform and value just-built new buildings unlike, for example, European cities with long history.
1. What is the background of reusing facilities?
The background of reusing facilities such as schools is the problems the Japanese society has, which are low birth rate, aging society and lack of working mothers, meaning the need of activating the community/society. Although they seem to have nothing in common, the three problems (keywords of activating the society) have one thing in common. That is “facility”, and each keyword symbolizes shortage or excess of facilities.
1) Low birth rate means closing of schools thus demolishing of school buildings.
With low birth rate, increasing primary/elementary (and junior high) schools have been closing. Three primary/elementary schools in the local community of the author’s workplace has integrated into one, meaning two schools closed by simple calculation, on March 27, 2010. This is not only in under-populated province, but is actually happening nationwide including in big cities such as in Tokyo as well.
2) Aging society means shortage of nursing homes.
With ongoing aging society, Japan is shortage of nursing homes for elders, which has been a serious problem, together with shortage of care workers, and have started “importing” care workers from other Asian countries such as Indonesia. New nursing homes have been built but the supply is still below demand.
3) More working mothers means shortage of day-care centres.
With more working mothers, Japan is also shortage of day-care centres. This has been a serious issue; it is common for women to wait for months to find one. Thus this is one obstacle for “diversity” initiation in Japan. This became even more prominent last year when pandemic (swine) flu broke out. Many schools in Japan closed and working mothers without have anywhere/anyone to look after their children had to stay home when they really needed to go to work. (Working at home is still extremely rare in most Japanese companies).
2. What is the idea? How was it implemented?
The idea implemented is reusing of old facilities, in particular, school buildings. Old primary/elementary school buildings that became unnecessary due to closing of schools are re-used as other facilities. Some of the examples are as below.
1) Reuse old school building as a ham factory.
One example is reuse of old school building as a ham factory, which is unexpected but logical from the requirement of a ham factory and characteristics of typical school buildings. Ham factories need well-ventilated storage/warehouse that can takes in abundant sunlight, and old school buildings are ideal because they have many large windows. A ham factory owner interviewed said that he is more than satisfactory with his new factory reusing an old school building.
2) Reuse old school building as a nursing home for elderly and nursery (day-care centre)
The other example is reuse of old school building as a nursing home for elderly (two floors: first and second floor) and nursery (one floor: ground floor) in Tokyo. Nursing homes for elderly and nursery are both extremely short especially in large cities so this solution is very logical and effective.
School is ideal for reusing as nursing home for elders for many reasons. First, many large windows let sunshine and light in. Second, wide corridors enable use of wheelchairs indoor similarly to hospitals. Third, veranda (sometimes at rooftop deck) allows residents enjoy fresh air and outside view. Old school buildings happen to have these requirements or nice-to-have factors that are not usually found in other facilities. It costs 140,000 yen/month for a person to live in the nursing home, which is reasonable and can be paid by pension.
School building is also good to reuse as nursery. This is logical because the target of both school and nursery are children; the only difference is the age group.
Co-location of nursing home and nursery (same building and premises) has a merit. Enders can interact with children which is extremely good because it would stimulate their monotone life cycle and helps them activate their brain. This helps them maintain sound physical and mental health. Also, children also benefits from interacting with elders because someone would have to take care of them and care worker alone does usually not supply enough manpower. Furthermore, unlike the old days when many children used to live with grandparents, most children do not have opportunity to interact with elders and learn from them, and co-location of nursing home and nursery provides such an opportunity.
3. What is the significance of reuse of old schools?
Tokyo now allows the re-user to utilize both the land and building for free for 20 years in order to encourage further reuse of old school buildings, which are otherwise to be demolished. This has much significance, both from financial and environmental perspective. It is calculated that this would have positive impact of 190 billion yen. Also this is of concept of 3R (reduce, reuse and recycle) of environmental preservation. This could trigger change in attitudes and views of Japanese people on effective use of assets of the community = facilities. Last but not least, this solves multiple problems that the Japanese society currently faces and need to solve immediately for its sustainability.
In a recent evening TV news programme, how reuse of facilities such as school buildings started to be implemented was featured. This kind of reuse if revolutionary in Japan where they tend to rebuild facilities and houses rather than recycle and reform and value just-built new buildings unlike, for example, European cities with long history.
1. What is the background of reusing facilities?
The background of reusing facilities such as schools is the problems the Japanese society has, which are low birth rate, aging society and lack of working mothers, meaning the need of activating the community/society. Although they seem to have nothing in common, the three problems (keywords of activating the society) have one thing in common. That is “facility”, and each keyword symbolizes shortage or excess of facilities.
1) Low birth rate means closing of schools thus demolishing of school buildings.
With low birth rate, increasing primary/elementary (and junior high) schools have been closing. Three primary/elementary schools in the local community of the author’s workplace has integrated into one, meaning two schools closed by simple calculation, on March 27, 2010. This is not only in under-populated province, but is actually happening nationwide including in big cities such as in Tokyo as well.
2) Aging society means shortage of nursing homes.
With ongoing aging society, Japan is shortage of nursing homes for elders, which has been a serious problem, together with shortage of care workers, and have started “importing” care workers from other Asian countries such as Indonesia. New nursing homes have been built but the supply is still below demand.
3) More working mothers means shortage of day-care centres.
With more working mothers, Japan is also shortage of day-care centres. This has been a serious issue; it is common for women to wait for months to find one. Thus this is one obstacle for “diversity” initiation in Japan. This became even more prominent last year when pandemic (swine) flu broke out. Many schools in Japan closed and working mothers without have anywhere/anyone to look after their children had to stay home when they really needed to go to work. (Working at home is still extremely rare in most Japanese companies).
2. What is the idea? How was it implemented?
The idea implemented is reusing of old facilities, in particular, school buildings. Old primary/elementary school buildings that became unnecessary due to closing of schools are re-used as other facilities. Some of the examples are as below.
1) Reuse old school building as a ham factory.
One example is reuse of old school building as a ham factory, which is unexpected but logical from the requirement of a ham factory and characteristics of typical school buildings. Ham factories need well-ventilated storage/warehouse that can takes in abundant sunlight, and old school buildings are ideal because they have many large windows. A ham factory owner interviewed said that he is more than satisfactory with his new factory reusing an old school building.
2) Reuse old school building as a nursing home for elderly and nursery (day-care centre)
The other example is reuse of old school building as a nursing home for elderly (two floors: first and second floor) and nursery (one floor: ground floor) in Tokyo. Nursing homes for elderly and nursery are both extremely short especially in large cities so this solution is very logical and effective.
School is ideal for reusing as nursing home for elders for many reasons. First, many large windows let sunshine and light in. Second, wide corridors enable use of wheelchairs indoor similarly to hospitals. Third, veranda (sometimes at rooftop deck) allows residents enjoy fresh air and outside view. Old school buildings happen to have these requirements or nice-to-have factors that are not usually found in other facilities. It costs 140,000 yen/month for a person to live in the nursing home, which is reasonable and can be paid by pension.
School building is also good to reuse as nursery. This is logical because the target of both school and nursery are children; the only difference is the age group.
Co-location of nursing home and nursery (same building and premises) has a merit. Enders can interact with children which is extremely good because it would stimulate their monotone life cycle and helps them activate their brain. This helps them maintain sound physical and mental health. Also, children also benefits from interacting with elders because someone would have to take care of them and care worker alone does usually not supply enough manpower. Furthermore, unlike the old days when many children used to live with grandparents, most children do not have opportunity to interact with elders and learn from them, and co-location of nursing home and nursery provides such an opportunity.
3. What is the significance of reuse of old schools?
Tokyo now allows the re-user to utilize both the land and building for free for 20 years in order to encourage further reuse of old school buildings, which are otherwise to be demolished. This has much significance, both from financial and environmental perspective. It is calculated that this would have positive impact of 190 billion yen. Also this is of concept of 3R (reduce, reuse and recycle) of environmental preservation. This could trigger change in attitudes and views of Japanese people on effective use of assets of the community = facilities. Last but not least, this solves multiple problems that the Japanese society currently faces and need to solve immediately for its sustainability.
2010年2月14日日曜日
How Japan Can Cope With Decreasing Labour Force?
Osaka – Sunday, February 14, 2010
Nikkei, specialized in economy/business and politics, reported on February 12 that lavour force* for 2009 was less than 60% of the total population over 15 years old for the first time after Word War II. This trend is prominent compared with other countries worldwide, and could well become a negative factor for economic growth.
1. What is the trend of Japan’s labour force, compared with other countries?
Japan’s labour force trend is quite different from those of other countries.
1) Japan’s Labour force has been on the decline in the aging society.
Japan’s labour force has once increased during high economic growth then started to decrease. The arrival of the aging society has been recognized for quite a long time and the effect has been prominent in the last 5-10 years, especially in the last few years. Labour force declined for 2 consecutive years to become 59.9% in 2009, the lowest since 1953, when statistics are available for comparison.
2) Only Japan’s labour force has been on the decline.
According to comparison with statistics of ILO (International Labour Organization), labour force of major countries for 2009 varies from country to country and some are less than that of Japan, but Japan is the only country that has been on the decline. Labour force of Western Europe such as France and Germany was 59.1%, 65.0% for the U.S. and 73.7% for China.
Although Western Europe was below Japan, none of these countries worldwide has been on the decline like Japan. For 2009, the U.S. is expected to increase by 0.4%, China to increase by 1.0% and Western Europe by 0.1%. However, according to MIC (Ministry of Internal Affairs and Communications), Japan’s labour force for 2009 was 66.17 million, which is decrease by 0.5% from 2008, and that it has decreased 2 consecutive years.
2. What is the outlook of Japan’s labour force?
The outlook of Japan’s labour force differs between ILO and the Japanese government. The Japanese government estimates that number of workers increase attributing to their employment policies and therefore the labour force remains at 59%. However, ILO estimates that it will decrease to 56.3% by 2020.
3. What is the reason for consecutive decrease in Japan’s labour force?
There are several reasons for Japan's consecutive decrease in its labour force.
1) Baby boomer generation has been retiring.
The fact that baby boomers has been reaching the age of retirement (60 years old) in the aging society is the biggest factor for decrease in labour force.
2) Less young people manage to get a job.
In the recent tough job market, less young people are successful in getting their job. According to recent reports, many people to graduate in March 2010 are still struggling with job hunting, when in time of stronger economy and job market many of them are usually offered a job by autumn, about 6 months before their graduation. Nikkei also points out that with such a tough job market, more young people give up even starting their job hunting. Nikkei and other news media also reported recently that some young people started to seek job outside Japan, such as in the U.S. and Asia.
4. What are possible ways to overcome negative impact of decrease in labour force on the Japanese economy?
In short, it is making diverse people entering job market, in addition to economic growth meaning activating job market. Possible solutions are as below.
1) Promote retired people to continue working.
Official retirement age is 60 in many companies, and government has started to request companies to re-hire employees reaching retirement age. This would contribute to leveraging their full-fledge expertise and know-how.
2) Promote women to work after marriage and have children.
Japan is behind other developed countries in this Diversity & Inclusion issue although they have started to initiate. They can further learn best practices from other countries and implement measures meeting situation, manners and customs etc. of Japan while changing the total system and infrastructure of the society. Some topics include day-care centre, child-care leave system, and work sharing to name a few. Of course, change in everyone’s mindset is vital.
3) Obtain help of talents/workforce from abroad.
Obtaining manpower from abroad is another solution. Being an island country with history of 200 years national isolation, contrary to countries such the U.S. that are rather open and proactive in accepting talents/workers from abroad, Japan has been behind in this field. Japan how has started to have talents/workers from Asia (e.g. Indonesia, China) to make up for shortage in workers of healthcare (caregiver) and agriculture (farmers) that are extremely critical. But these measure as rather “reactive” measures.
The author feels that Japan would need to take more “proactive” measure to attract talents/workforce with long-term strategy, with learning from other countries, including smaller countries such as Singapore, Finland and Columbia that successfully took corporate strategy approach. They positioned themselves carefully to develop vision and strategy and successfully implemented, such as to become country strong in medical, welfare, IT, environment etc. and focused on investing and attracting talents/workforce/capital from around the globe in that particular industry, while improving systems and infrastructures of total society aligning with the total strategy.
After all, this issue is all about how to make Japan an attractive place to invest and do business in, and making it competitive in the global economy.
* Labour Force (from Nikkei, edited and translated by the author)
Labour force is sum of employed (employees in companies/organizations and as business owners) and unemployed (people who are hunting for a job). This is one of the metrics showing economic poser of a country. People who have retired, given up job hunting, full-time housewife and students not include in the job market are excluded in labour force.
Nikkei, specialized in economy/business and politics, reported on February 12 that lavour force* for 2009 was less than 60% of the total population over 15 years old for the first time after Word War II. This trend is prominent compared with other countries worldwide, and could well become a negative factor for economic growth.
1. What is the trend of Japan’s labour force, compared with other countries?
Japan’s labour force trend is quite different from those of other countries.
1) Japan’s Labour force has been on the decline in the aging society.
Japan’s labour force has once increased during high economic growth then started to decrease. The arrival of the aging society has been recognized for quite a long time and the effect has been prominent in the last 5-10 years, especially in the last few years. Labour force declined for 2 consecutive years to become 59.9% in 2009, the lowest since 1953, when statistics are available for comparison.
2) Only Japan’s labour force has been on the decline.
According to comparison with statistics of ILO (International Labour Organization), labour force of major countries for 2009 varies from country to country and some are less than that of Japan, but Japan is the only country that has been on the decline. Labour force of Western Europe such as France and Germany was 59.1%, 65.0% for the U.S. and 73.7% for China.
Although Western Europe was below Japan, none of these countries worldwide has been on the decline like Japan. For 2009, the U.S. is expected to increase by 0.4%, China to increase by 1.0% and Western Europe by 0.1%. However, according to MIC (Ministry of Internal Affairs and Communications), Japan’s labour force for 2009 was 66.17 million, which is decrease by 0.5% from 2008, and that it has decreased 2 consecutive years.
2. What is the outlook of Japan’s labour force?
The outlook of Japan’s labour force differs between ILO and the Japanese government. The Japanese government estimates that number of workers increase attributing to their employment policies and therefore the labour force remains at 59%. However, ILO estimates that it will decrease to 56.3% by 2020.
3. What is the reason for consecutive decrease in Japan’s labour force?
There are several reasons for Japan's consecutive decrease in its labour force.
1) Baby boomer generation has been retiring.
The fact that baby boomers has been reaching the age of retirement (60 years old) in the aging society is the biggest factor for decrease in labour force.
2) Less young people manage to get a job.
In the recent tough job market, less young people are successful in getting their job. According to recent reports, many people to graduate in March 2010 are still struggling with job hunting, when in time of stronger economy and job market many of them are usually offered a job by autumn, about 6 months before their graduation. Nikkei also points out that with such a tough job market, more young people give up even starting their job hunting. Nikkei and other news media also reported recently that some young people started to seek job outside Japan, such as in the U.S. and Asia.
4. What are possible ways to overcome negative impact of decrease in labour force on the Japanese economy?
In short, it is making diverse people entering job market, in addition to economic growth meaning activating job market. Possible solutions are as below.
1) Promote retired people to continue working.
Official retirement age is 60 in many companies, and government has started to request companies to re-hire employees reaching retirement age. This would contribute to leveraging their full-fledge expertise and know-how.
2) Promote women to work after marriage and have children.
Japan is behind other developed countries in this Diversity & Inclusion issue although they have started to initiate. They can further learn best practices from other countries and implement measures meeting situation, manners and customs etc. of Japan while changing the total system and infrastructure of the society. Some topics include day-care centre, child-care leave system, and work sharing to name a few. Of course, change in everyone’s mindset is vital.
3) Obtain help of talents/workforce from abroad.
Obtaining manpower from abroad is another solution. Being an island country with history of 200 years national isolation, contrary to countries such the U.S. that are rather open and proactive in accepting talents/workers from abroad, Japan has been behind in this field. Japan how has started to have talents/workers from Asia (e.g. Indonesia, China) to make up for shortage in workers of healthcare (caregiver) and agriculture (farmers) that are extremely critical. But these measure as rather “reactive” measures.
The author feels that Japan would need to take more “proactive” measure to attract talents/workforce with long-term strategy, with learning from other countries, including smaller countries such as Singapore, Finland and Columbia that successfully took corporate strategy approach. They positioned themselves carefully to develop vision and strategy and successfully implemented, such as to become country strong in medical, welfare, IT, environment etc. and focused on investing and attracting talents/workforce/capital from around the globe in that particular industry, while improving systems and infrastructures of total society aligning with the total strategy.
After all, this issue is all about how to make Japan an attractive place to invest and do business in, and making it competitive in the global economy.
* Labour Force (from Nikkei, edited and translated by the author)
Labour force is sum of employed (employees in companies/organizations and as business owners) and unemployed (people who are hunting for a job). This is one of the metrics showing economic poser of a country. People who have retired, given up job hunting, full-time housewife and students not include in the job market are excluded in labour force.
2009年9月21日月曜日
Reality of Aging Society Of Japan
Monday, September 21, 2009 – Osaka, Japan
The third Monday of September is a national holiday of “Respect-for-Senior Citizens Day” in Japan. There have been articles in the newspapers and TV news related to aging society, depicting the reality of the aging society of Japan, whose average age for female is the oldest and is one of the country whose problem of aging society is severe.
Nikkei, Japan's leading newspaper specialized in economy and politics, today reported that according to the survey implemented and analyzed by Ministry of Internal Affairs and Communications (MIC) on estimated population as of September 15, senior citizens above 65 years old increased from 2008 by 800,000 people reaching the highest in the history which is 28.98 million people, even though population of 15-64 years old decreased by 760,000 people from 2008 to 81.56 million people. This is 22.7% of the total population, which is 0.6 point increase from 2008. The female senior citizen over 65 years old is more than 25% of the total population.
Moreover, the household with such senior citizen is 18.21 million, which is increase by 1.8 million from 5 years ago. This includes 4.14 households in which a senior citizen lives on his/her own, meaning higher possibility of solitary death.
TV news this morning reported a few senior citizens full of vitality, both physically and mentally. A 103 year old man looks after himself, leading extremely healthy live including shaving and taking a towel bath of cold water which is known as very good for health. His dining habit is also good; he eats balanced diet cuisines of appropriate quantity, and chews at least 30 times before swallowing. He is fluent in 5 languages and enjoys calligraphy. He says that the secret of being physically and mentally healthy is having something to live for.
A woman of 87 year old is, surprisingly, an active athlete, specialized in 200 metres. She is a record holder of 200 metres for Japanese women over 65 years old of approximately 46 seconds. She started to sprint in earnest when a relay member was desperately needed in a sports day when she was 70 years old and she joined extemporarily. Since then, she has been doing training to sprint everyday and participating in various competitions, giving smashing results. She says that she would like to keep on running as long as she is physically healthy.
The aging society is a big issue in Japan. Because of this issue, the former government established a health care system for the latter-stage elderly in 2008, which had been a topic under hot discussion in the General Election held in August 30. Mr. Nagatsuma, the new Health, Labour and Welfare Minister (nicknamed “Mr. Pension” because he had been asking tough questions on pension before the new government was kicked off), announced recently that this policy will be change/terminated.
The new policy would have direct impact on the senior citizens and on healthcare industry. Of course, the aging society would have impact on overall society, economy, and labour market. Whatever the policy and regulation of the new government may be, it seems that senior citizens cannot simply segmented by their age group and more flexibility is desired.
The third Monday of September is a national holiday of “Respect-for-Senior Citizens Day” in Japan. There have been articles in the newspapers and TV news related to aging society, depicting the reality of the aging society of Japan, whose average age for female is the oldest and is one of the country whose problem of aging society is severe.
Nikkei, Japan's leading newspaper specialized in economy and politics, today reported that according to the survey implemented and analyzed by Ministry of Internal Affairs and Communications (MIC) on estimated population as of September 15, senior citizens above 65 years old increased from 2008 by 800,000 people reaching the highest in the history which is 28.98 million people, even though population of 15-64 years old decreased by 760,000 people from 2008 to 81.56 million people. This is 22.7% of the total population, which is 0.6 point increase from 2008. The female senior citizen over 65 years old is more than 25% of the total population.
Moreover, the household with such senior citizen is 18.21 million, which is increase by 1.8 million from 5 years ago. This includes 4.14 households in which a senior citizen lives on his/her own, meaning higher possibility of solitary death.
TV news this morning reported a few senior citizens full of vitality, both physically and mentally. A 103 year old man looks after himself, leading extremely healthy live including shaving and taking a towel bath of cold water which is known as very good for health. His dining habit is also good; he eats balanced diet cuisines of appropriate quantity, and chews at least 30 times before swallowing. He is fluent in 5 languages and enjoys calligraphy. He says that the secret of being physically and mentally healthy is having something to live for.
A woman of 87 year old is, surprisingly, an active athlete, specialized in 200 metres. She is a record holder of 200 metres for Japanese women over 65 years old of approximately 46 seconds. She started to sprint in earnest when a relay member was desperately needed in a sports day when she was 70 years old and she joined extemporarily. Since then, she has been doing training to sprint everyday and participating in various competitions, giving smashing results. She says that she would like to keep on running as long as she is physically healthy.
The aging society is a big issue in Japan. Because of this issue, the former government established a health care system for the latter-stage elderly in 2008, which had been a topic under hot discussion in the General Election held in August 30. Mr. Nagatsuma, the new Health, Labour and Welfare Minister (nicknamed “Mr. Pension” because he had been asking tough questions on pension before the new government was kicked off), announced recently that this policy will be change/terminated.
The new policy would have direct impact on the senior citizens and on healthcare industry. Of course, the aging society would have impact on overall society, economy, and labour market. Whatever the policy and regulation of the new government may be, it seems that senior citizens cannot simply segmented by their age group and more flexibility is desired.
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