The employment of older people: Can we learn from Japan?

Abstract

The level of employment among older people, including those above retirement age is very high in Japan. This has been attributed to the lifetime employment system, and provisions for external transfers and demotions that allow wages to be reduced as people pass middle age. The paper points to how the structure of Japanese industry is also important and how many older Japanese are working in relatively unproductive and sheltered jobs. Moreover, it questions whether the lifetime employment system can survive, and shows how early retirement schemes, similar to those in the west, are being introduced as a response to continued recession. On top of this, external pressures for deregulation are threatening the ability of protected sectors to absorb older people. Japanese employers have a tendency, as do western employers, to discard older people. All employers will, in the face of population ageing, have to learn how to use older people better. © 2005 The International Association for the Study of Insurance Economics.