Japan’s employment inequalities a major concern for foreign investors and Japanese business' outlook

Updated: Jul 15

Richardt Schoonraad


Recent reports by the Oxford Economics group have indicated that Japan’s former middle class is depleting and becoming almost nonexistent as the number of Japanese enter new stages of poverty, this economic shift occurring due to financial struggles during the 1990’s which were often dubbed Japan’s worst decade. Moreover, Japan’s level of unemployment and economic disparity stands at 15.7% as reported by the Organization for Economic Co-Operation and Development. In recent years as well, Japan has been adjusting itself towards offering part time employment as compared to traditional long term employment systems that were previously in place. This former employment structure had led to Japan’s earlier economic success having intricately involved policies that would ensure that employees were well cared for after completing their period of work as well as differentiated wages by level of experience as well as bodies that support employees and hence contributed to Japan’s most significant economic growth since the 1950’s to the 1960’s though the rate of rise in salary takes patience and thus companies cultures in Japan focused more on security rather than individual performance or productivity levels.


Image Courtesy: Strategy + Business


The system of Old Japan


To add to the complex economic situation of Japan’s current economic inequality in employment trends, Japan has faced fractured opinion and divided access to equal education which it has always valued but trailed behind what industrialized nations such as the United States could offer to low income families. This can be understood by Japan’s decision to not offer grand scholarships but instead making access to public institutions as low as possible as to ensure that low income students can receive the proper levels of education. However, this initiative has many shortcomings highlighted by research articles that suggest that Japan lags far behind developed countries in their ability to offer affordable higher education and university accessibility as general fees have seen a significant hike in the last 25 years making university unaffordable to most low income Japanese families as the figure stands at ¥200,000 to the current average rate of ¥530,000. Though the view on this equal education philosophy was initially held by Japanese parents and Japanese citizens held the common view that education opportunities should be accessible for every student as this would be the only means for the youth to carve a better future and thus overall contribute towards a much more rigid and stable Japanese economy.


Image Courtesy: Savvy Tokyo

Women and people who may lead the change


The inequality that Japan holds even with regards to the livelihood of young children is quite surprising and appalling despite Japan being one of the wealthiest nations in the world, with Yasushi Aoto who is the standing chairman of the Japan Association of Child Poverty and Education Support Organizations has released a statement regarding the matter, ’the poverty rate that we see today demonstrates just how hard life for children in Japan over the last 25 years.’’ Moreover, there have been documented regions which house greater inequalities and child poverty rates as for instance, in Okinawa, the rate of child poverty stands at 29.9 % and apparently 80% higher than anywhere else in Japan. Concerningly a lack of confidence indicated within the nations former leadership has seen individuals take action and initiative in their community, in a specific case study, Chieko Kuribayashi who heads the Toshima Kodomu WakuWaku NGO set up the first of Japan’s kind initiative, dubbed the ‘’children’s cafeteria’’ with this initiative sweeping the nation and seeing the setup of over 300 centers across the nation. Encouragingly, during recent times however, Japanese females are sweeping the workforce as from 2019 onwards, almost 64% of the women in Japan aged between 25 to 34 years of age had received attested degrees as compared to 59% of men receiving such a level of education. Additionally due to a lack of considerable progress of the Japanese labor market, the government has invested in employing more women and foreigners in their workforce to make up for economic losses and slow progress and this has also led to an outstanding 82% in women who have received a higher education’s employment future and outlook improving as a result of this change in Japan’s business dynamics and setup. However, in regards to recent events and bodies involved in the Tokyo Olympic games, as one of the Tokyo Olympics chief Yoshiro Mori, highlights Japan’s lack of development in gender empowerment and equality rights awareness as he unceremoniously retired his position in a controversial setup that he encouraged which, emphasized that women could attend important meetings concerning the event alongside their male colleagues however were restricted and essentially stripped of their right to speak out or voice opinions. This issue is however strongly poised and rooted since world war two and Japan’s traditional family setup and gender roles which still sees women or mothers in the household, as reported by a recent National Survey in 2020, completing 3.6 more household related work than men within the household. Concerningly, this has also contributed towards another significant issue that Japan and scholars have recognized the nation to struggle with, an aging population and low birth rate and thus as the economic times get tougher, the work life balance and once women are forced to decide between their career or taking maternity leave, this has contributed to many women deciding to not have any children at all. This lack of positive action and investment in wellbeing and family development has received outright criticism by journalist Toko Shirakawa on Japan’s dealing of the matter as follows, ’the government was only pushing to increase the number of female leaders, without offering any fundamental changes or support. The burden was on women to bear.’’ It is this sheer lack of representation and complicated structure in Japan that has led the World Economic Forum to highlight the significant lack of involvement of women in Japan’s economic and overall economic impact and societal involvement.



Japan’s economic struggle and desire to bridge the longstanding employment gap


Japan has looked into developing ‘’womenomics’’ as a means to boost the overall GDP as well as towards empowering women within the nation, however this would once again disregard the greater sociological development of Japan, particularly with regards to the public’s general wellbeing, values of dignity as well as self fulfilment to name a few. Though researchers have signified that if Japan is to head towards becoming a gender neutral society, then stronger policies must be developed that look beyond only assisting the female population. A potential starting point may include the recently drafted paternity leave scheme initiated by the Ministry of Labor on the 1st of October 2020 which would allow for males to look after the children at home as well. This would contrast the previous living standards and social cultural dynamics as often men would dedicate longer hours for their employers at work whilst women would as discussed earlier in the context of the paper, as expected to spend all of the time at home or attending to childcare duties. In recent pushes however, Yoshihide Suga has tapped into its massive economic megabanks such as Mitsubishi UFJ Financial Group Inc, Sumitomo Mitsui Financial Group and Mizuho Financial Group has pushed for an overall more diverse workforce and skill set within employees getting hired in Japan as stressed as crucial for the economy’s future as highlighted by Japan’s Financial Services Agency and Tokyo Stock Exchange. Ultimately, Japan still holds various inequalities in its market and in particular politics as Japanese women only make 21 % of the upper house of Japan’s Inter Parliamentary Union and thus Japan lies 164th out of a total of 193 listed countries in terms of female representation and figures in the field of legislation. Despite the significant backlog that the Japanese administration currently holds with regards to equal representation of genders and diversity in the workplace, however senior journalist Saito has placed faith in the youth’s potential to drive the necessary change, specifically improve Japan’s Glass Ceiling power distribution ranking as they have already sought out action from the government by putting forward at least 1,000 listed suggestions focusing on gender equality initiatives thus instilling hope for Japan’s future development. Of these approaches, some of the concepts of focus have been sexual harassment cases during interview sessions, effective contraceptive pills as starting points as Japan looks to model Europe’s gender equal standard where Japan is one of the lowest ranked in this regard internationally



About the Author:


Richardt Schoonraad is a fresh graduate having studied a Bachelor's Degree specializing in Psychology with Human Resource Management. He is passionate about public health, forensic psychology, health sciences, social work, travelling and learning languages. He is currently a U matter Ambassador and member of Project Leap, a United Nations organization known for volunteering, story sharing and connecting people from around the world through community based initiatives. Richardt has also been a volunteer for the UAE Ministry of Economy during the Annual Investment Meeting in April 2018 and a recipient of a Best Research Award from the American University of Sharjah’s MUN during February 2018. He is a member of the Current Affairs mandate at CRRSS.

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