Japan grapples with ageing challenges

Firms in Japan have expressed concern over a government plan to encourage people to work until they are 75 years old.

    Longevity is at once a source of pride and concern for Japan

    With fewer children being born and Japanese people living longer than ever

    before, thanks largely to medical advances, Japan's population is expected to

    shrink by 10 million by 2030, leaving it with a shortfall of workers.

    Aware of the looming threat to its industry and way of life, Tokyo has waged

    campaigns to encourage people to have more children, while there are also

    proposals under consideration to allow more foreigners into Japan to work.

    Worried that even those measures will leave the country short of manpower, an

    advisory panel to the government has suggested the civilian equivalent of Dad's

    Army as Plan C.

    Quotas backed

    "We strongly support this proposal as many older people have many skills and

    knowledge that they can still share in the workplace," Fumiko Inoue, a

    spokeswoman for the Japan Organisation for Employment of the Elderly and People

    with Disabilities, said.

    "If they are in good health and want to work, it would be wise to make use of

    their skills."

    People aged 65 or older account
    for nearly 20% of the population

    Inoue added: "But at the moment it is difficult for people once they reach

    the retirement age of 60 to find employment.

    "We believe it would be better to have rules that oblige companies to have a

    percentage of elderly people as employees."

    The advisory panel, a committee of the Council on Economic and Fiscal Policy, is

    to submit its Visions for a 21st Century Japan to Prime Minister Junichiro Koizumi

    in the spring of 2005.

    The population problem is arguably more pressing than economic stagnation or

    nuclear-tipped North Korean missiles.

    In the year up to 31 March 2004, a mere 1,129,239 babies were born, the

    lowest figure since statistics were first compiled in 1968 by the Ministry of Home

    Affairs.

    Major problem

    In the same period, those aged 65 or older accounted for a record high 19.24% of Japan's 126,824,166 people. And while the Japanese used to be proud

    of their longevity, the government knows it has a major problem on its hands.

    In 2003, the Ministry of Health, Labour and Welfare announced that it planned to

    sink more than Y1 trillion into efforts to arrest the alarming slide in the birth rate

    and reverse what has become the worst ageing population problem in the world.

    "It's true that lots of Japanese people are still quite lively in their 70s, but it's

    beyond my imagination to still be employing them to 75"

    Junichi Yasutaka,
    Director, Human Resources,
    DaimlerChrysler Japan

    The worrying statistic that one in five Japanese will be aged 75 or over by 2030

    has given extra urgency to the study, although the companies that will be affected

    are less than enthusiastic at the prospect of a greying workforce.

    "The implications for employers are huge and I can't imagine what companies will

    have to say about it should the proposal be adopted," Junichi Yasutaka,

    director of human resources at the Japanese unit of DaimlerChrysler, said.

    "It's true that lots of Japanese people are still quite lively in their 70s, but it's

    beyond my imagination to still be employing them to 75."

    Rigid system

    From a purely financial point of view, Japan's rigid seniority system will require

    that older workers take home a disproportionately higher wage, while younger

    members of the company may find their new ideas and approaches turned down in

    favour of methods that were tried and trusted in decades gone by.

    Companies' insurance bills would rise, along with their contributions to health-care plans, while older staff are likely to require more time off through illness.

    A shrinking population is going to
    leave Japan short of manpower

    "In general, a blanket increase in the retirement age is not considered a

    favourable proposition as it could negatively affect a company's comeptitiveness,"

    Tatsuya Iida, a spokesman for Honda, said.

    "Furthermore, as the funds available for salaries is a certain percantage of a

    company's income, the postponement of the retirement age would make it more

    difficult to hire young associates," he added.

    In April 2003, Honda introduced a programme whereby staff would be allowed to

    work a further 12 months beyond the mandatory retirement age of 60, but whether

    they were actually rehired depended on the "balance" the company believed it

    needed in that year, Iida said.

    Elderly wisdom

    Mitsubishi Electric currently allows its staff to work until the age of 60 and is

    considering extending that to 65, but has no plans to extend that to 75 in the

    future, according to Travis Woodward, a spokesman for the company.

    "The elderly can bring wisdom and experience to a workplace," he said. "They

    can also bestow this experience on younger workers."

    "We strongly support
    this proposal as many older people have many skills and

    knowledge
    that they can still share in the workplace"


    Fumiko Inoue,
    spokeswoman for the Japan Organisation for Employment of the Elderly and People with Disabilities

    A spokesman for TetraPak Japan expressed similar opinions, but dismissed the

    suggestion that the majority of people aged 75 would be of benefit to a company

    with a terse, "No, they would be too old."

    And while employers agree that valuable skills and knowledge would be passed on

    to a new generation of employees, the financial burden - and concerns over the

    health of older staff - would outweigh the benefits.

    "It is clear that a good number of older workers have a strong desire to work

    past the retirement age because they would prefer to work than just stay at

    home," Yasutaka, DaimlerChrysler's HRD director, said.

    "But the response I think the government will get from companies is laughs at the proposal."

    SOURCE: Aljazeera


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