Montreal Forum: Changes in Social Fabric of Japan

Merle Aiko Okawara (Chairperson, JC COMSA)

Presentation at GLOCOM-UQAM Forum, Montreal, Canada - November 24, 2003

Winds of change have been blowing through the social fabric of Japanese society, and today I would like to explore a few of them with you. They are (1) the decreasing number of children; (2) the aging population; (3) the increasing participation of women in society, and (4) the changing and diversifying lifestyles of citizens.

Undoubtedly the most significant social change is the result of lower fertility rates and people living longer, giving rise to a rapid demographic transition from a relatively young country until the 1950s (with an average age of late twenties) to an aging society as defined by the United Nations with an average age of over 40 today.

In the 1940s women had an average of four children. That figure has dropped dramatically in 2002 to 1.32. According to the National Institute of Population and Social Security Research, the Japanese population will peak in 2007 and is projected to decline to 67 million in 2100. That is a 50% decrease in a century, so you can imagine what will happen if the population keeps decreasing by 50% every 100 years. People joke that at that rate, sometime in the next millennium the entire population of Japan will be able to fit into Tokyo dome.

But it is not a joking matter. This is a serious problem that is being faced not only by Japan but also by most developing countries, because a decreasing population obviously will impede economic growth and put pressures on the working population with regards to social security.

Factors Related to Lower Birth Rates
I would like to just briefly go over the factors leading to a decrease in the number of children. One of the reasons for the drop in the fertility rate is that both women and men are putting off marriage until a later age, 29 for men and 27 for women. About half of women in their late twenties, which is the age group that used to have the highest birth rate, remains unmarried. Indeed, when I was a younger a woman over 25 was referred to as Christmas cake, because after the 25th of December nobody is interested in Christmas cake. Women are putting off marriage until a later age because they have been brought up in a fairly affluent style by their parents during the bubble years and don't feel that young men could give them the same lifestyle. Also, having children would place heavy economic burdens on the young couple because housing and education costs are so high.

The second reason for married women having fewer children is the fact that more women would like to continue working but find it difficult to do so with children. This is due to inflexible customs and ideas about gender roles by which men should work outside and women should take care of the family. The Confucian belief in "good wife, wise mother" still prevails to a certain extent today.

Older and Living Longer
The second major social trend contributing to the present crises is a rapidly graying society. Due to better health care and improved standards of living, the life expectancy for Japanese men is 78 and for women 85, the highest levels in the world. In the year 2000 people over 65 represented 17% of the population, and this number is expected to explode in the year 2050 to 36%. These two social trends, lower fertility rates and a rapidly graying population pose and will continue to pose economic and political problems for Quebec and Japan and for most developed countries.

Socio-Economic Impacts
The major problems resulting from lower fertility rates and an aging population put pressures on the entire social security system, including public pension, medical care and other social welfare programs. The Ministry of Health, Labor and Welfare is proposing that pension premiums be revised from the current 13.5% to 20% of the annual income of salaried workers by the year 2020. Since the premiums are evenly shared by employee and employer, there have been cries of resistance from both groups. Most young people feel that in their retirement they will never be able to receive benefits equivalent to their contributions.

Possible Solutions
There are several possible solutions to this problem. The first option would be to open our borders to immigration in the model of Canada and the US to rejuvenate the population and ease the burden on the working generation. Immigration is a difficult issue and ways to tackle it have not gained consensus among citizens.

During the years of high economic growth when there was a severe labor shortage in Japan, the government decided to allow limited immigration. Second and third generation Japanese--descendants of Japanese emigrants to South America--were allowed to enter Japan on work visas. Indeed, my company was among those companies only too happy to welcome these people to work in our factories. Even today we have employees by the names of Jose Suzuki and Gabriella Tanaka. Unfortunately these South American returnees to Japan were among the first to be let go in the recession and many are suffering not only economically but also socially because they have not yet been completely assimilated into society even after ten or twenty years. Therefore, I think that the idea of accepting other Asian immigrants on a large scale is one that still will not be accepted by the general public in the near future, although it is certainly something that has to be carefully considered for the long term.

The second solution would be to extend the retirement age from 60 to 65.

Finally, the third solution would be to encourage women to have more children by improving the social infrastructure, increasing benefits and encouraging corporations to introduce more flexible working conditions. Although at present the unemployment rate is at a high of about 5.3%, in the long run there is no doubt that we will have a labor shortage. So the government has to find ways of encouraging women to work and at the same time to have more children, a difficult task indeed.

Women in the Workplace
There is a third major social trend affecting present conditions, and that is the growing impact made by women in the work place and in society in general.

A little over 50% of women are continuing on to two year colleges and universities, slightly more than men. This is preparing many women for jobs in corporate, legal, medical and other sectors.

But the labor force participation by Japanese women differs from women in other developed nations as is made clear by the well-known m-shaped curve with two peaks. The number of women entering the work force peaks in the 20-24 age group, then gradually curves down during child rearing years and has a second peak in the 45-49 age group when women re enter the work force mainly as part time workers. But recently we see a favorable trend in which the curve is growing steadily to the right and is less peaked.

Many women would like to continue working during child bearing years, but the cultural belief that men should work outside and women should remain in the home still persists. This means that women are entrusted with the upbringing and education of children and feel obliged to devote their entire effort and time to their children until these children enter school.

There is also a lack of public and corporate infrastructure to facilitate smoother relations between workplace and home. For example, there are still approximately 40,000 children waiting to get into nursery schools, especially in urban areas. Furthermore, Japanese corporate culture places priority on the company, which means long working hours and after-hours drinking with clients and colleagues. In addition, even if their wives work husbands do little to help around the house. Men whose wives work spend an average of 25 minutes a day helping around the house, compared to 4 hours and 12 minutes of household work put in by working women.

Despite the barriers and obstacles in their way, women are making slow and steady progress. And despite the fact that the world economic forum ranked Japan 69 out of 75 as far as empowerment of women is concerned, I feel that we are definitely making some progress, slowly but surely. I would just like to run through a few figures that indicate women's participation in certain fields.

Women in Government
Japan's best and brightest university graduates still aspire to government jobs, and it was recently reported in the media that the number of women hired as fast track bureaucrats for fiscal 2004 was a record 124, or 19% of the new recruits. In the international realm, the first woman ambassador was appointed in 1980, and since then we have had eleven women ambassadors. Today there are three: the ambassadors to Italy, Ghana and the disarmament mission in Geneva. Women have made the biggest gains on government advisory councils and panels. When I was first appointed to a panel about ten years ago, only 10% of the members of all national councils were women. Today that number has risen to 25%.

Women in Business
As far as business is concerned, women traditionally were hired by large companies to serve in mostly auxiliary clerical roles and to serve tea. Such women are widely referred to as "OLs" or office ladies. However, since the equal employment opportunity laws went into effect in 1986, companies began to offer a two-track system to women. One track allows them to continue in clerical work, therefore avoiding excessive overtime and transfers to other locations, and a career track has the same obligations and opportunities as men. Regardless, only 9% of women have reached management positions.

So the more ambitious of these women who were getting tired of bumping their heads against the bamboo ceiling have decided to run their own businesses. We number about 65,000 and represent 5% of the companies in Japan. Most female entrepreneurs run small companies, where the flexibility may allow them to continue to care for their families. But the economic impact is significant and will continue to grow.

About ten years ago a few women friends got together and decided that we had to do something ourselves to improve the status of women. Instead of waiting for things to change, we decided that we would be catalysts of change. We formed a group called leadership 111, made up of women who had reached high levels in their professions. Our objectives were to network among ourselves and to learn from each other. We also decided to help and encourage the next generation of women leaders by holding seminars and programs. Our name, leadership 111, is a play on the words "wan wan", Japanese for how dog bark. We are determined to bark loudly and clearly to make ourselves heard. Leadership 111 with one extra bark. We now count among our members three present and former cabinet ministers, a couple of former ambassadors, a governor and many successful businesswomen, scientists and educators. We are also trying to expand our network internationally and have visited our counterparts in various countries. I am hoping that my visit to Quebec will be a seed that will grow into a strong relationship between the women leaders of Canada and the women leaders of Japan.

Women in Politics
As far as politics is concerned, female representation in the diet or parliament is among the lowest in the world. Including both chambers it is about 10%. In 1946 the new constitution after the war gave women the right to vote for the first time, and in the House of Representatives election that year 39 women were elected. We have never been able to regain such numbers. Therefore, not being able to just sit by and do nothing, about six or seven years ago five of my friends got together and decided that in order to speed up the process of improving the status of women we would need to increase the number of talented and proactive women politicians. We formed a group called "Win Win" because we felt that if we could increase the number of women in government it would be a win for us and it would be a win for the country. We have since greatly increased our membership, which of course also includes men.

In Japan, where approximately 40% of the members of parliament are second or third generation politicians, it is difficult for newcomers to break in. for example, Prime Minister Koizumi's father and grandfather were politicians. They say that in order to win one needs kanban, kaban and jiban. These Japanese words translated into name recognition, a bag of money and a constituency. Most of the women that we are supporting don't have any of those requirements, so we try at least to supply the money. WinWin is a fundraising organization, but our members also help out by giving campaign speeches and do other support work. We have helped to elect 17 women to both houses of the diet, and in the recent lower house elections five of the 10 women we supported won.

But we feel that we have made the biggest strides in local government. Until the year 2000 we had no women governors, and now only three years later there are four out of 47 and they are heading fairly important prefectures: Hokkaido, Osaka, Chiba and Kumamoto.

Individualism and Cultural Exchange
The last social change that I would like to discuss is the diversifying lifestyle of the Japanese people. Japan used to be a country of monolithic culture and uniform tastes. There is a saying, "minna de watareba kowakunai", which translates as "if we all cross together we have no fear". People of old Japan took comfort in looking and acting in the same manner and not sticking out. Now people are aspiring to different dreams. Just visit Harajuku on a weekend and you will see throngs of young people, teenagers dressed as individualistically as they can. Boys and girls wearing purple or green wigs, in any kind of outlandish dress possible. This is the generation of children born after Japan had gained recognition as a global economic power. They are confident in themselves and they are confident in their fashion sense, and not only easily adopt western culture as their own but add their own individual flair and interpretation. This is the generation of Japanese that is helping to bring about a new type of leadership being referred as to GNC or "gross national cool", as opposed to the GDP equated with the now waning economic leadership. And, indeed, Japan is exporting its new culture of cool throughout the world.

Japanese music is recognized throughout Asia. Japanese animated films such as Spirited Away have captivated audiences around the world, and Japanese pop artist Takashi Murakami has combined the best of both worlds by decorating Louis Vuitton bags with his cute characters. Hello Kitty is almost as popular as Mickey Mouse. Furthermore, in a show of so called soft power, designers such as Yamamoto Kansai and Kenzo have been dressing elegant women around the world for years. In addition, Japanese culinary art has risen to new highs globally. A generation ago Japanese cuisine was almost unknown outside of the country, but now it is found everywhere. I am told that sushi is an extremely popular dish in Quebec.

Lifestyles are also diversifying for people in their twenties and thirties. Due to the economic impact of globalization, employers are being forced to modify their employment contracts as it becomes more difficult to maintain the Japanese style of labor management. However, an Anglo Saxon style of management cannot be imported as is, so Japanese companies are finding some midway solutions.

In other words, life long employment will continue to be guaranteed more or less for full time employees, but companies will be hiring less full time employees and salaries and promotion based on the seniority system are starting to give way to performance based remuneration.

In place of full time employees, companies are hiring more contract workers, part time workers and "freeters" (freeter is a new Japanese expression taken from the English "free" and the German "arbeiter" or worker. Free worker, in other words not tied down to one company). So as a consequence of hard economic times and often out of choice, young men and women are enjoying a freer work environment. As a matter of fact we also are beginning to see full time employees job-hop. People are aspiring to different dreams.

Many single working men and women opt to live with their parents despite their financial independence, and because they usually only contribute a small percentage of their incomes to their parents they can afford a very affluent life style. They are extremely brand conscious and fashionable. Therefore despite the recession, Louis Vuitton, Prada and Gucci are extremely successful in Japan.

Changes for Middle-Aged Citizens and Seniors
Moving on to changes in the life styles of the middle aged and older people, Japan is referred to as a job-linked society and the focus of salaried men's relationships are workplace oriented. When these salaried men retire this can result in two different social trends.

The first is that middle-aged wives who had been left alone while their husbands worked long hours and spent weekends on company-related activities had to find their own hobbies and friends. But when their husbands retire with no real friends of their own and no hobbies, these husbands try to find a place in their wives' lives but are considered a nuisance. Such husbands are called "nureochiba" or wet leaves because they are difficult to sweep away, or even "sodai gomi" or big rubbish. One result is that when children are grown there is no need for women in such relationships to keep up the facade any longer, so they get divorced and enjoy going out to eat and traveling with women friends.

The second trend is more positive: the increasing popularity of volunteer activities among the middle aged and retired as a way not only of doing good for the community but also to form friendships with other people of similar interests.

Conclusion
In conclusion, from a businessperson's view these social changes also present new opportunities. The decreasing number of children means that parents and grandparents are willing to spend more money on each child. It is not unusual to see children dressed in designer clothes or with a TV set in their own rooms. The aging population opens up business challenges and opportunities in providing nursing care, but also goods and services for an age group with a fairly large amount of disposable income. Finally, the increasing entry of women into the work force presents opportunities in private day care centers and other services catering to working women.

As Japan leads the world in confronting a diminishing and aging population, its people look to political leadership to make the right decisions and assure the security and safety and well being of the nation. Will they succeed? Only time will tell, and we don't have too much time left.