^aThe Pensions Institute, Cass Business School, City University, 106 Bunhill Row, London EC1Y 8TZ, U.K. E-mail: b.casey@city.ac.uk

A much earlier version of this paper was presented at the Workshop on Ageing, Skills and Labour Markets, organized by CEPII and held in Nantes, September 7–8, 2001. Later versions were given at the conference Pressure, Policy-Making and Policy Outcome – Understanding East Asian Welfare Reforms, organised by East Asia Social Policy Research Network and held at the University of Kent, June 30–July 2, 2005 and at the seminar on the Employability of Older Workers, sponsored by the organised ESRC and held in London, September 9, 2005.

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.