How can companies in Japan make the most of their experienced, older workers?
Half of Japan’s population is aged over 50 and 27% of people are older than 65, the official retirement age.
That often leads to negative headlines in the international media about a “demographic time-bomb” – a phrase I dislike.
However thoughtful reporters – like the Financial Times’ Tokyo correspondent, Leo Lewis – take a more balanced view.
I liked his excellent analysis in the FT on August 9th, which suggests that changes in demographics bring with them opportunity.
He draws on research by the Japanese Cabinet Office which suggests that most people would rather like to carry on working until at least the age of seventy – or longer if their health permits them to do so.
On my visits to Japan, I’ve seen many examples of older people contributing to the workforce in positive ways. I fondly remember meeting people who are in their sixties and seventies who work at the Yamaha musical instrument factory in Hamamatsu.
Many of them enjoy passing on their own knowledge – and also learning new skills. This is a good example of the kind of balanced working environment which is being encouraged by the Japanese government, employers and unions.
Currently, Japanese people can choose to start receiving the state pension anytime between 65 and 70, with bigger monthly payments on offer to those willing to delay.
Under Japan’s mandatory retirement system, people currently usually leave the payroll at 60, although this is set to rise to 65 in 2020.
Lessons for Britain
It’s interesting to compare the situation in Japan with that in the UK, which also has an ageing population.
In response to that challenge, the British government has decided to increase the state pension age to 68 and there is an ongoing debate as to what year that change should come into place.
But for people who want to work into their sixties, seventies and beyond, there are often frustrations.
Alistair McQueen the head of savings and retirement at the insurance firm Aviva says British companies have been poor at investing in training for workers over the age of 50 – even though they now make up one in three of the workforce.
He told the BBC he is also disappointed employers do not offer greater flexibility in the working hours of older people, especially those who have caring responsibilities.
Aviva, Co-op, Boots, Barclays and are among the businesses in the UK which have promised to increase the number of over-50s they employ.
“Our findings suggest that older employees have a lot to offer at work,” says Mr McQueen. In that many people in Japan will heartily agree with him.