Japan and the labor crisis. Will opening doors solve the problem?

Tokyo’s Koto area is just waking up when a Vietnamese national along with his four Vietnamese colleagues arrive at the construction site at 6:30. A small group of Japanese colleagues go with them everyday to work and they spend the day moving heavy wooden planks and pouring concrete for a seven-story condo building.


Immigration is a big issue in Japan and some warn that allowing more foreign workers into the country will cause several unforseen problems. Abe has been trying to guarantee that companies get the workers they need while showing that he is limiting the amount of foreign workers entering the country.


photo credit to: https://www.wsj.com

Japan is facing a very tight labor market in forty or fifty years and businesses would like Abe to go further. Unemployment now stands at 2.5%, whereas 25 years ago, no one complained about unemployment. Strangely, there are now 1.59 jobs for every job seeker, the highest ratio since 1974.


Japan’s demographics make it the world’s oldest advanced economy and labor shortage is just increasing. Japan’s working-age population, defined as those aged between 15 and 64, is expected to decrease to 45 million over the next five decades.


In contrast, those aged 75 or the “super-elderly” as the people like to call them, are expected to make up more than 25% of the Japanese population in 50 years’ time.


No industry is feeling the effect of aging more than the farm sector, where the average worker is 67, and 60% are 65 or older. Their children left for the city looking for high paying office work.


Among them is Kota Hirohara, 56, who raises cabbages on his small farm. Recently, in may, two Indonesian trainees were harvesting Hirohara’s cabbages by hand with large nakiri, or vegetable knives. Hirohara says his farm is not big enough to need an expensive cabbage harvesting machine and only employs locals or foreigners.


Reference: Famous for its resistance to immigration, Japan opens its doors


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