Among the advanced economies, Japan has continuously ranked at or near the top in terms of the percentage of population who continue to work beyond the retirement age. Some of these individuals actually want to work; but for most, it's a choice between continuing to toil or facing the prospect of not-so-genteel poverty.
The term coined for this encroaching phenomenon is rogo-resu, a portmanteau combining rogo (retirement or one's remaining years) with the English suffix -less. The word appears to have made its first appearance in an Asahi Shimbun article dated Nov 2, 2019, in which editorial writer Hiroki Manabe warned, "Japan is likely to become a society without a comfortable retirement age."
Shukan Jitsuwa (March 16) reports that should this situation come to pass, the implications are terrifying: In the not too distant future, perhaps one out of every two seniors will need to keep working up to the time they are no longer physically or mentally able to work.
According to data by the Ministry of Internal Affairs and Communications, the number of working persons above age 65 has increasing year on year for 18 consecutive years. In 2021 some 60,000 new seniors joined the ranks, boosting the nationwide total to approximately 9.09 million. In 2021 the ratio of working people in the 65 to 69 years of age bracket surpassed the 50% mark, with 50.3% in that age group still working.
Even among those in the next higher age bracket of 70 to 74 years, about one out of three people still work.
How did this state of affairs come about? An analyst at a think tank explains to the magazine, "During the postwar period of rapid economic growth, Japan became the world's second largest economy, and when workers reached the compulsory retirement age of 60 it was assumed they'd enjoy their golden years, traveling and pursing their interests.
"But then the economic bubble collapsed in the 1990s, and later came the so-called 'Lehman Shock' of 2008, which prolonged the deflationary spiral. With the recent devaluation of the yen currency and resulting rise in energy prices, people's dreams for a comfortable retirement have been crushed," he said morosely.
According to a survey of older workers by Rengo, the Japanese Trade Union Federation, in 2019, 46.2% of the respondents gave their rationale for continuing to work as "to maintain health." This was followed by "raising quality of living" (33.9%) and "because a person lives to work" (28.8%). But the most frequently stated reply (multiple replies were given), voiced by 77.0%, was "to enhance the quality of life."
The aforementioned analyst recalled the statement by the Financial Services Agency in 2019, which stated that an average elderly couple will need at least 20 million yen in savings to fund a 30-year post-retirement life. But in 2022, 20.8% of households where the main breadwinner was age 60 and above had zero savings. And that figure is rising -- up by 2% over the year before.
A business analyst told the magazine that over 70% of the temporary or part-time workers at convenience stores and supermarkets, security guards, custodial workers, care providers, workers at call centers and so on are over 65.
With shortage of workers in some fields, some companies have initiated programs to retain older workers with specialized skills. To name one example, the re-employment system adopted by VFR, a Tokyo-based drone manufacturer, allows workers to continue their careers up to age 75.
Taxi firms also hire the elderly in growing numbers. As of March 2022, about 50,000 drivers were believed to be in the 70 to 74 age bracket, and another 20,000 drivers, or 8% of the total force, age 75 or older.
"As drivers' average age keeps increasing, so are the number of accidents they're involved in, both minor and serious," a concerned driver over age 70 admitted to Shukan Jitsuwa.
About one care provider in four at homes or in institutions is said to be over age 60, and cases can even be found where women in their 80s are visited by care providers who are also in their 80s, raising concerns that elderly workers risk injuries while changing diapers or caring for their loved ones
"The managers at apartments with a large number of elderly residents find themselves having to deal with constant complaints or becoming entangled in disputes between the residents," a business analyst tells the magazine. "Many of them can't deal with the stress and quit after a short time."
Post-retirement life does not appear at all optimistic, the article concludes.© Japan Today
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If you dig deeper, a large percentage of adults never worked and never will work. This article is mainly applicable to perhaps 10% of low wage men.
The trainees the Jgovt allowed fills in the gap in the workforce. But some don't even contribute to social security and through some senior company staff, give work priority to them as most give "extra service" out of work hrs. Pity us residents who sometimes are at their will and dismissed to give way to more trainees like these. And when the pension plan dwindles, they'll blame it all to the govt when in fact the problem starts with them.
@Chico3 - That sounds like a good plan if you are able to do so and not get double taxed. I would take Roth IRA over iDeco and NISA any day. It does seem Japan is trying to strengthen these types of plans as they look to attract more young investors here so only time will tell.
And back to the topic, yes I agree completely with your statement. I also think if you are doing the same amount of work, you should not have to reduce your salary just because of your age.
@SDCA - Thanks for your reply. I've been taking a good chunk of my salary here and moving it to the US in my IRA and VUL. I was just wonderding if I was missing. To get back in topic, more power to these people to continue to work past retirement age who like what they are doing. The saddest part of life is working in a company just for the money with little or no energy for the job.
Sort of, and it's not very good.
Just asking, but doesn't Japan have some kind of 401K plan or IRA or its equivalent? If it's just retiring on pension, then good luck with that one.
Modern, industrialized countries absolutely need to address the issue of retirement for the elderly. I am not saying that I have the answers, only that the issue is an important one.
Yes, elderly friends and neighbours believe continued work prolongs life.
I wonder if this could not be put to better use.
Passing on there wealth of skills and experience to a younger generation.
I am sure Government, both local and state is missing something here.
The phenomenon of working literally until death , has been and is prevalent in present day Japan.
So, retirement in Japan for most people is not very attractive. I would point out that most retirees here in the States live on nothing more than their Social Security payments, which makes for a meager retirement. Still, better than being homeless.
How about a discussion about what should be done to fix the problem, both in Japan and in the States? Over here, President Biden as asked that Social Security taxes on the very wealthy be raised, to prevent payments for everyone else being reduced. Why is such a solution not investigated in Japan? I have read that a declining population will make it harder to maintain Japan's minimal social security payments, but how about a discussion about asking the very wealthy to contribute more?
I'm 55 this year and there's no end to work in sight. I'm self employed though, so it could be a lot worse. Our youngest is only 10, so that's part of the problem. With folks having kids as late as they are now, retiring in your 50s is increasingly unlikely
I agree with the above that the idea of folks retiring at 60 and then drawing a comfortable pension for twenty-five years, quite possibly including state-funded residential care is fundamentally unsustainable and is destined to be a one or two generation thing. The same generations in Western countries will have benefited from massive house price inflation, and therefore also have the option of cashing in on their house and going to live somewhere cheaper.
I'm 74 and I'm still working, but I'm a white-collar professional. It's cruel to force people to keep working past 55 if they have a physically demanding job.
I have never heard asking 'Would you like fries with that?' or standing in the road in a poncho and waving an orange baton for minimum wage described in such a way .
Work adds life to one's life span. Out there in the Forest of Bliss, older workers are seen as Wisdom Banks.
My dad retired when he was 54 back in the 90s. I'm now just a few years short of that and the idea of even thinking about retirement at that age is just laughable. I'll count myself lucky if I'm able to at 65, meaning at least 11 years less life at ease for me than my immediate predecessor.
This whole "generational inequality" thing is real.
In France, you get about 70% of your average salary if worked for 43 years.
Can't they explain a little in the article what is the practise in Japan, because I understand that whatever you work, it seems you get officially embezzled about retirement.
This is normal when you forgot youth is your next futurea nd politician care and give way more to their voters, the senior, than the next generation.
Japan's got a terrible social-security system. The US system is miles better, with median income at age of 65 about $2,500 a month compared to the Japanese standard pension of 65,000 yen. In Canada, basic pension, "nenkin," is free, whereas in Japan, people pay 17,000 yen a month.
Furthermore, Japan's retirement savers put their money into cash and life insurance. Very little is invested.
However, Gov. will still chase you with extraordinary retirement contribution ( freelance, self-employed ) even though you may get enough for food and place to sleep in the box somewhere around Tocho in Shinjuku.
I read about one of European country where contribution is high too but they already saying that one will likely receive 25% of their last earning
I am 70+ and still running my business. A friend is 85 and still runs his major transport company providing work and income for more than 50 families even through the whole covid event.
I know many 70+ working part-time or full-time. Mostly because their pensions do not cover their living costs.
Nobody ever said getting old was easy, either individually or from a societal standpoint....
But staying active's still best strategy, inactivity the worst!
exactly what blue said.
All in contrast to the current happenings in France, where millions of people across the wider workforce have been striking and demonstrating because of the govt's attempt to raise the retirement age from 62 to 64.
Of course entirely different take on what constitutes a Pension so comparing is shaky, but suffice to say that one society holds the right to a sustainable retirement as paramount and will challenge the powers, while another society just accepts the govt's failure to secure a fair pension for all as - well it can't be helped.
The lost 3 decades in Japan should have seen a more vocal population rage against the govt in numbers, esp over the pension debacle.
The fault for an inadequate pension system in Japan, allowing for a simple but fair retirement, lies squarely at the feet of the inept politicians / bureaucracy.
Last time I looked, around 40% of the workforce were working gig jobs. This means they can not afford a house, most likely can not marry, can not have afford to have kids, can not they save money, hence nothing to fall back on should one start to talk about retirement. Conclusion, it is not about a choice of whether and when to retire, it is about having no choice to do so...
Down the road, I would expect:
first an increase in work-related accidents (I already did read articles last decade about an increased percentage in work-related accidents involving workers close or over age 60)second a decrease in life-expectancy (as gig-workers can not afford health care)
As such, "post-retirement" life is becoming less and less of a topic with focus shifting to "aging" overall, and the (negative) effects all this will have on society. No, definitely nothing to be "optimistic" about, I'm afraid.
It is neo-feudal and no accident.
You left out the standard MBA formula at U.S. business schools, which basically maintains that in the quest to satisfy shareholders and attract investors, a company's rank-and-file workers are expendable.
Welcome to the club.
Some of the dark humor about this subject, especially amongst the young, frustrated with late stage capitalism.
Conveniently leaving out the culprits.
Bankers who privatized profits and socialized losses and were never prosecuted as the economic shocks resulted in declining economic prospects for many.
Neo-liberal trickle down economic policies like Abenomics or New Capitalism increasing economic wage precarity and stagnation while corporate profits continue rising.
It is neo-feudal and no accident.
that generation knows nothing about life except work.
so its also kind of mental settings.
no hobbies,no travel abroad,enjoy life at minimum since enjoyment is replaced by work.this generation cant imagine for example if will go for holiday abroad for one week-what can I do 7 days there.very very common.
and yes also its about financial factor as many may have no savings or pension is very low so cant keep paying bills every month.
definitely not my cup of coffee.when retirement age will come will be happy to be retired ,will enjoy hobbies,will travel,enjoy life.