The Yomiuri Shimbun“Work style reforms” should be advanced steadily. This year will be a critical juncture in this regard.
To overcome population decline and the ultra-aging of society are great challenges Japan faces.
The working population of women, the middle-aged and the elderly should be increased by facilitating employment that is compatible with child-rearing and nursing care. The decline in the birthrate should be stopped in the medium and long run by sweeping away people’s concerns about the future and turning the economy around. The government aims at realizing a “society that enables the dynamic engagement of all citizens.”
Cutting work hours key
The key to this lies with reforming working styles, through such means as rectifying the problem of working long hours. Prime Minister Shinzo Abe has emphasized that this is a “year to act decisively” in this regard. The public and private sectors should join hands in tackling these challenges.
The number of births in 2016 is estimated to have totaled 980,000, falling short of 1 million for the first time since the government began keeping the relevant statistics in the Meiji era (1868-1912).
If present trends continue, the total population will fall from the current 127 million to as low as 87 million in 2060, with the elderly population reaching 40 percent of the total. The working population will also shrink to two-thirds of the current level in 2050.
Unless the population decline is curbed and the working population is increased, the nation’s social security system will become dysfunctional. In order to make the system sustainable, it is necessary to rectify such labor practices as workers doing overtime regularly.
The average working hours of people with permanent employment status in Japan hovers at a high of around 2,000 hours a year. More than 20 percent of the workers work for longer than 49 hours a week, far more than the figure of around 10 percent for their counterparts in European countries.
Also prevalent are such labor practices as overtime exceeding 80 hours a month, considered the “death from overwork line.” The case of a young female employee at leading advertising agency Dentsu Inc., who committed suicide due to overwork, is representative of what has become a social problem.
The work style of regular workers, often pressed to choose between their work and family life, has deterred women from developing their careers and men from participating in household chores and child-rearing. This has also been a major factor behind the low birthrate.
Needless to say, expanding child-care and nursing care services is important. But that alone would not see women taking more active roles in society or bring about an increase in the birthrate. It is also quite doubtful that such measures alone will allow the government to realize its goal of “reducing to zero the number of people who are forced to leave their jobs for nursing care.”
The government plans to set an upper limit on overtime. It is necessary to promote changes in the consciousness at workplaces, so that the practice of working shorter hours efficiently will be rated highly.
“Equal pay for equal work,” a system to ensure equal treatment regardless of the form of employment, is yet another pillar of the work style reforms.
Wage levels of non-regular workers stand at 60 percent of those of regular workers in Japan. This ratio falls far short of comparable figures for non-regular workers in European countries, who get 80 percent of what regular workers get. Non-regular workers have increased to account for as much as 40 percent of the total workforce, spreading also among younger generations. The increase in young people who give up on getting married or having children due to economic reasons is exacerbating the problem of the low birthrate.
Measures that will promote various human resources to play active roles, and hence increase productivity, include wages based on actual work regardless of employment status and paths to higher careers being widened by expanded education and training.
The government will come up with an action plan for work style reforms within this fiscal year. It must be an effective one.
Secure fiscal resources
A hike in the consumption tax rate to 10 percent was postponed, forcing the integrated reform of social security and the tax system to be restructured.
Among scheduled measures, the government plans to first implement those to improve treatment of workers in childcare and nursing care services to secure needed human resources. The urgent task is to secure permanent financial resources.
Containment of ballooning costs in medical and nursing care services is the most vital part of building a social security system that can withstand the super-aging society. With revisions of fees for medical and nursing care services coming in fiscal 2018, the work to determine specific aspects of the revision will progress this year. A focus of attention will be how efficiency is reflected in the revisions.
To meet medical service needs, the number of hospitals’ short-term beds, which are high-cost, should be reduced while the number of beds for recovery and convalescent periods should be increased. Also a system enabling elderly people to live at home while feeling secure must be built, with enhanced combinations of home medical services and nursing care services.
While the quality of medical services should be enhanced, reforms must progress to contain costs.
Regarding nursing care insurance, it is inevitable to prioritize benefits for those who need a high level of service. Local governments must urgently develop frameworks for taking over responsibility for livelihood support services for elderly people who require a low level of nursing care.
It is also vital to strictly implement a principal of sharing burdens according to people’s financial strength, including among elderly people.
For future generations
During the extraordinary Diet session last year, the pension reform related law was enacted. But many issues are still pending.
It is especially problematic that the new legislation did not get into the complete implementation of the “macroeconomic slide,” which will automatically lower pension levels in response to further declines in the low birthrate amid an aging society.
Currently the implementation of the macroeconomic slide is restricted due to deflation, so that the lowering of pension levels has been delayed. However, the delay will bring reduced pension benefits to future generations. The macroeconomic slide must fully be implemented regardless of the economic conditions, as it is vital to protect pensions for future generations.
The issues of expanding the range of people eligible to be covered under the kosei nenkin employee pension program and extending the period of premium payment for the basic pension have barely been addressed. It was confirmed in 2014 fiscal studies that these steps will be effective in improving pension benefits in the future.
Reforms must not be allowed to slacken due to fear of a backlash from elderly people.