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25.03.2017 г.

Japanese Youth at the Labor Market: Economic and Social Aspects (Part I)

I.P. Lebedeva

The article analyzes the situation established in the past ten years in the youth segment of the Japanese labor market. The author shows shifts in the structure of youth employment as well as differences in the state of different age cohorts and in the character of employment of young men and women. Special attention is being drawn to some social problems that the Japanese youth faces as a result of changes in the structure of demand at the Japanese labor market.

Keywords: youth, forms of employment, social status, marriage and family, "non-standard" groups.

Over the span of several post-war decades workforce was one of the most important resources of Japan's economic growth, and the annual inflow of tens of thousands of well-educated young people into the national economy was among the main factors ensuring effective functioning of the whole system of management of Japanese companies. Meanwhile, the country, due to its population ageing, has seen a quick decrease in the number of working-age persons (from 15 to 64 years old) - from the peak of 87.2 million people in 1995 it decreased to 77.9 million people in 2014, or by 10.7 %. Also, by virtue of the country's demographic development features, after World War II it faced a drastic decline in the young labor force. Thus, the total number of young people aged between 15 and 34 years decreased from 35.4 million in 1995 to 26.3 million in 2014, or by 25,8 %, and the share of this group in the total number of Japanese of active working age - from 40.6 % to 33.8 %, respectively [1, p. 54, 518].

On the face of it, this situation would improve the young people's position on the labor market, expand their employment opportunities, increase their starting wages, etc. However, a prolonged depression of nearly two decades that struck Japan in the early 1990s after the collapse of the "bubble" economy the effects of which can be felt even today, quite considerably complicated the labor market situation. In addition, shifts in the industry structure of the national economy and changes in its material and technological base in recent decades have significantly transformed the pattern of demand for labor in terms of its occupational structure and skill level. It is obvious that young people, especially new entrants to the labor market, experienced all these changes to a considerably greater extent than other age cohorts of the labor force, especially those who are protected from their effects by the lifetime employment system [2]. Therefore, it would be very interesting to consider the issue of the Japanese youth position on the labor market, what changes occur in this sphere, as well as their social consequences.

It is conspicuous, above all, that young Japanese take quite an active part in the society's economic life. Thus, according to 2014 data, among the young adults aged from 15 to 19 years the share of working persons was 16 %, among the young aged from 20 to 24 - about 70 % and among the cohort of people of 25 - 34 years of age - nearly 85 % [1, p. 518]. It is clear that the gap between these indicators can be explained by the fact that the first age group includes school and university students, continuing education, and the second and third groups are represented mainly by those who have finished their education and started their working life.

In contrast to many developed countries, Japan is not faced with such a serious problem as the high unemployment rate among the young. Although the unemployment figures among the young workforce groups are somewhat higher than the country's average (3.6 % as of April 2016) and reach 5.3 % for the group aged from 15 to 24 years and 4.6 % for the group aged from 25 to 34 years, it is obvious that against the background of other developed countries the situation in Japan appears to be more than favorable [3].

In other words, judging by the above figures, it is possible to make a conclusion that Japanese young people can feel quite confident in terms of employment and opportunities for building their life plans. However, a somewhat different picture is seen if we take a closer look at the issue.

As is known, one of the main changes observed on the Japanese labor market since the beginning of the 1990s was a quick increase in the employment structure of the share of casual laborers - their share increased from 20 % in 1990 to 38 % in 2012. In subsequent years, thanks to a certain improvement in the economic conjuncture it somewhat decreased - to 34.5 % in April 2016, however, it still remains very high [4]. Also, aside from the economic depression, there were two more factors contributing to a sharp increase in the casual employment rate. Firstly, the servicization process in the Japanese economy, manifesting itself in advanced growth of industries in the services sector (including individual), which creates objective prerequisites for a wider use of various flexible work schemes. Secondly, it's the change of the very nature of labor as a result of the Japanese economy's transition to the postindustrial development stage. Along with the kinds of labor which, the same as before, require special professional knowledge and permanent skill improvement, the jobs have appeared for the performance of which strict following instructions and computer literacy and IT skills are sufficient. And if companies need permanent employees for the first type of jobs, then non-permanent employees are well suited for the second type [5, p. 60-61].

As was mentioned above, due to the peculiarities of the Japanese labor market, namely the existence of the institution of lifetime employment with its guaranteed preservation of permanent employee status and long-term employment for those hired in previous years, changes in the Japanese companies' structure of demand for labor affected primarily the young, new entrants to the labor market. Therefore, the growth of nonpermanent employment was most significant among the young workforce contingent. Starting back in the 1990s, this process continued over the last decade, as evidenced by the data in Table 1.

Table 1. Changes in Japanese youth employment pattern (men and women of the age cohorts of 15-19 years, 20-24 years, 25-34 years, 2006 и 2015)*













Total employed, thous. people







18 740

Regular workers, thous. people







15 890

Their share in total number of employed, %








Irregular workers, thous. people








Their share in total number of employed, %









Total employed, thous. people







15 370

Regular workers, thous. people







10 180

Their share in total number of employed, %








Irregular workers, thous. people








Their share in total number of employed, %








*The data do not include those employed in agriculture.

Estimated and compiled on the basis: [6, (2006, 2015)].


These data, in our opinion, are very representative for our analysis. First, they cover a period that can be considered relatively favorable from the point of view of the Japanese economy state. Although it was the decade when the global financial and economic crisis of 2008-2009 broke out, followed by the March 2011 disaster, the country's overall economic situation was sufficiently stable and no sharp fluctuations on the market were observed. Second, the original data based on which Table 1 was made, are of high quality in terms of reliability and comparability and make it possible to see an objective picture of the changes taking place in the area of youth employment.

It should be noted that in the 2006-2015 period the number of young workers continued to decrease rather quickly - from 18 million 740 thousand in 2006 the young labor force declined to 15 million 370 thousand in 2015, or by 18 %. At the same time the number of young people having permanent employment decreased from 15 million 890 thousand to 10 million 180 thousand, or by 36 %, and the number of casual laborers, on the contrary, grew from 2 million 850 thousand to 5 million 190 thousand, or increased by 182 %. Such a variety of trends caused a drastic change in the youth employment structure: if in 2006 the balance between permanent and non-permanent workers was 84.8 % : 15.2 %, then in 2015 - 66.2 % : 33.8 %, respectively.

Table 1 data show that the growth of casual employment took place in all age and gender cohorts, but the pace and scale of this process differed greatly in different groups. Let's consider these differences in more detail.

The largest share of non-permanent workers is observed in the younger age cohort, i.e., among the young men and girls aged from 15 to 19 years. In 2006 this share for young men was nearly 45 % and for girls - more than 50 %, and in 2015 - 66 % и 83 %, respectively. Such a widespread occurrence of casual employment among this group can be explained by the fact that the young people for whom school or university studies is the main occupation, and work is only a means for them to earn money for personal needs predominate in this group. Thus, in 2015 more than half of young men and 2/3 of girls in this age cohort fell in this very category [6]. And the arubaito (temporary worker) day-do-day jobs in cafes, small restaurants, convenience stores, etc., are particularly popular among school and university students.

As for the sharp growth of casual employment in this age group that has taken place over the last decade, it can be explained, above all, by the increase in the number of young people continuing their education after secondary school. The share of young people who limit their learning by compulsory secondary education and enter the labor market at the age of 15 is extremely low - under 1 %. And the absolute majority of Japanese young people seek to continue their education after finishing high school - in two-year colleges, vocational schools (semmon gako), universities. Thus, if in 2005 a total of 70 % high school graduates decided to continue their education, then in 2014 - 77 %. The distinguishing feature of the last two decades is a considerable increase in the share of girls among university students. If in 1995 it was roughly 1/3, then by 2014 it increased to 48 % [1, p. 740, 747]. This is partly because many two-year colleges (tanki daigaku) with the predominant share of girls were transformed into universities, and partly - because more and more young Japanese women want to get decent education in order to improve their permanent employment chances. That's what accounts for a sharp increase in the share of non-permanently employed women in this age cohort over the last decade.

The next age group - young people aged from 20 to 24 years - is represented mainly by those who have finished their education and their main activity is work. In 2015 a total of 82 % of young men and 78 % of girls in this age cohort fell within this category. According to Table 1 data, over the last decade the share of non-permanently employed in this group has practically doubled and reached nearly 40 % for young men and 45 % for girls. As this group includes the young people who finished their education and entered the labor market, these figures speak very eloquently about how much more difficult it has become for these young people to find a permanent job after school or university. This is true not only for girls, but also for young men who have always enjoyed employment priority.

Of course, assessing these figures we cannot ignore the fact that in Japan, the same as in any other developed country, life styles and life preferences are now becoming more and more diversified and that far from all young Japanese men and women seek to get permanent jobs with all their accompanying restrictions. Thus, according to a study of the Ministry of Health, Labor and Welfare, some 40 % young people under 24 who have no permanent employment fall within the category of so-called involuntary irregular workers, that it, those who wanted but failed to get a permanent job; some 45 % decided to postpone getting permanent employment for the future, and the remaining 15 % would like to fulfil themselves in the spheres not linked with permanent employment (such as theater, cinema, pictorial art, etc.) [7, p. 154;
8, p. 12]. Given the situation prevailing on the Japanese labor market, a natural question arises - maybe these 45 % decided to postpone until a future time their permanent employment because they failed to do that right after graduation?

The position of the Ministry of Health, Labor and Welfare testifies, for example, to the fact that, despite all the changes in the labor market, inconstant employment, as before, is perceived in Japan as a certain deviation from the norm. In the ministry's labor market surveys the "standard employee" is the one who "was hired by a company right after graduation and will work for it for a long time" [9, p. 3].

The following aspect is also worth highlighting. According to Table 1 data, in the age cohort under review the share of permanently employed women is just a little lower than the share of permanently employed men (54.6 % and 60.9 % respectively). However, this does not mean that the positions of women on the Japanese labor market are equivalent to the positions of men. Despite the fact that the Japanese employment equality law that prohibited any form of gender-based discrimination was adopted back in 1985, the gender factor continues to affect the position of women on the labor market. Thus, most of the Japanese women who succeeded in getting permanent employment have to settle for more modest professional careers than their male colleagues. Up to the present day many companies hire women mainly for the so-called ordinary work (ippanshoku), while men are entrusted to perform the so-called general career work (shogoshoku). While the general career work involves the development of skills within the framework of in-house training, career growth and an annual increase in wages, the ordinary work offers significantly more modest opportunities for professional development and career growth, which means a more moderate increase in wages. Also, if at the career start the differences in wages between men and women are hardly noticeable, then as they approach the age limit of their stay in the company (60 years), they become more and more perceptible. For example, the chart below shows the initial differences in wages of the male and female graduates of educational institutions of different standards of education (monthly wages, thousand yen) in 2015 [10]:




Graduates with Master's degree



Graduates of four-year universities



Graduates of vocational schools or colleges



Graduates of senior high school




It is possible to assess the degree of divergence of the workers' paths in the future by the gender differences in terms of the wage growth by the completion of their professional career (Table 2).

Table 2. Difference between initial and maximum wages of permanent employees (wages of workers aged 20-24 years =100)

Categories of workers



 school graduates


school graduates


(50-54 years) 246

(55-59 years) 212

(50-59 years) 180


(50-54 years) 190

(50-59 years) 145

(45-49 years) 124

Source: [9, p.7].


As these data show, even in the most privileged group - women with higher education - far from all can count on an equal professional career with men.

Gender differences in the nature of employment of Japanese young people become even more obvious in the age cohort of 25-34 years. They also existed before, but have never been as strong as they are now. Thus, if in 2006 the share of men in this age group having a permanent job was 93.9 %, and the share of women - 83.5 %, then in 2015 - 83.5 % and 59.3 %, respectively.

Since this age group is represented by rather mature young people, such high rates (especially among men) can be seen as evidence that, with all the changes taking place in Japanese society, permanent employment does not lose its value and that the older young Japanese become, the stronger they seek to have a permanent job.

Nevertheless, according to Table 1 data, over the past decade this group has also seen a considerable reduction in the permanent employment scale. Thus, the number of permanently employed men in absolute terms decreased by 2 million 340 thousand, or by one-third, and the number of those who do not have permanent jobs, on the contrary, increased by 500 thousand, or twice. In the women's group, the number of permanent workers has decreased by 1 million 780 thousand, or by 40%, and the number of those without permanent employment has increased by 1 million, or more than twice. The fact that these shifts occurred amid unfavorable demographic trends, namely, in the conditions of an absolute youthful workforce reduction, testifies to the profound and rapid changes in the structure of demand occurring on the Japanese labor market.

Although both the scale and share of permanent employment among men of this age cohort have decreased, obviously, their status in general is quite favorable so far. An absolute majority of these young men (over 80 %) have permanent employment, and, consequently - a reliable source of income and the possibility to plan their life for a long-term perspective. The women's labor situation is much more complicated.

It's not just the growing divergence of professional growth trajectories in this age group and more acutely felt differences in the opportunities for skills upgrading between permanently employed men and women. Much more serious problems lie in the fact that for women entering this age cohort, it is time to decide on marriage and the birth of children. In contrast to the earlier practice, young women no longer tend to quit their jobs immediately after marriage. However, as regards the birth of children, the changes are hardly noticeable here. According to statistics, after 30 years - which is currently the average age in which women give birth to their first child - many women not only quit their jobs, but also do not return to their original place of work even when their children grow, preferring various forms of inconstant employment to permanent employment.

This is not to say that the Japanese government is doing nothing in this regard. Since the early 1990s, laws have been enacted in Japan and various measures have been taken to create conditions for women to reconcile domestic responsibilities and work. Back in 1991, a law was passed on the provision of paid leave to care for a child before reaching 1 year (in the amount of 25 % of the salary). Then this law was repeatedly reviewed, and in 2010 the duration of leave was brought to 18 months, and the size of payments - up to 50 % of the salary level. In addition, the norms of the law were extended to small and medium-sized enterprises, restrictions were imposed on overtime work for people with children, entrepreneurs were instructed to take into account the family situation of the employee when deciding whether to transfer him to a new place of work, and also prohibited any discrimination against employees who choose to take leave. Finally, companies in which at least one man will take leave to care for the child, were promised state support and public recognition [11, p. 5].

As is known, a set of measures aimed at creating more favorable conditions for working women and increasing their participation in the economic life of society was carried out within the framework of Abenomics [12]. However, according to Table 3 data, no noticeable changes are observed in the nature of women's employment: the proportion of women working on a permanent basis, reaching peak values in the age group of 25-29 years, then begins to decline steadily and no longer returns to the previous level.

Table 3. Share of permanent workers among employed women (%)*





















60-64 years























* The data do not include those employed in agriculture.

Estimated on the basis: [6, (2012, 2015)].


This situation persists because of the following circumstances. First, the overall shift in the structure of labor demand was manifested, in particular, in the widespread use by companies of the practice of replacing permanent workers with temporary ones in the sphere of ippanshoku - the traditional patrimony of women. Secondly, since the crucial importance for promotion in Japanese companies is the continuous improvement of professional skills on the basis of in-house training, the separation of women from this system for the period of parental leave entails for them the inevitable loss of pace in career growth, and, consequently, Reduces in their eyes the attractiveness of the previous place of work. Thirdly, and this is, apparently, the most important thing - with all the changes that have occurred in Japanese society in recent decades, here still, including among Japanese women themselves, traditional concepts of the role and purpose of women are widespread. She must first of all be the mother and mistress of the house, and work is the destiny of the man.

Thus, young Japanese women who have received a permanent job place face a difficult choice - either marriage, leaving work after the birth of the child and the life of a housewife with work under conditions of inconstant employment, or a career with the rejection of marriage and the birth of children or, at best, With the transfer of these events as late as possible.

End of Part I (To be concluded)

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