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Fertility Rates Could be Lifted by Putting Japanese Women to Work

By Debbie Howard

Although the old image of the Japanese woman subserviently removing her master’s shoes is a distant memory in these modern days, some sobering statistics show that the role of women in Japan’s future is still not nearly as well leveraged as it could or should be.

In terms of general employment, in fiscal year 2007, approximately 23 million women in Japan (representing about 49% of all women) were engaged in gainful employment.

Of course there are still challenges with the “mix” of types of work, including part-time vs. full-time as well as “clerical” vs. “management” levels. For example, a study published in the Economist (2006) found that Japanese women accounted for less than 1% of directors on corporate boards, compared to 15% in the U.S. and 7% worldwide.

It is interesting to note that the problem of “low fertility rates” has been correlated by Kathy Matsui (Chief Strategist for Goldman Sachs and author of a fascinating report titled “Womenomics”) with “low female employment rates” for a number of countries. In other words, countries such as Japan that have low female employment rates also have low fertility rates. So if we look at this conversely . . . if Japan can find a way to utilize women in the workplace, it will also help to address the flat birthrate challenge!

According to the United Nations Human Development Report (2007/2008), Japan ranked 54th (out of 93) in a worldwide a Gender Empowerment Measure, putting it behind other developed countries, as well as a number of developing countries. A 2003 OECD report on work and family life suggested that Japan could avoid future labor shortages if it extended more support to working mothers. According to the OECD, only 28.5% of all Japanese women with children aged three or less were working, including those on maternity and child-care leave. This compares with more than 70% in Austria and Denmark, both of which offer very good support for working mothers in comparison to Japan.

Furthermore, the OECD report pointed out that 70% of Japanese women permanently retire from the labor force after getting married, partly due to the reality that, after staying at home for several years to raise their children, only low-paying part-time work is available to them. Consequently, 95% of male university graduates in Japan are employed, compared with 65% of female graduates. This is especially disturbing when one considers that about one-half of female senior high school graduates advance to either universities or junior colleges, and a larger number of women than men pursue higher education after graduating from senior high school.

The OECD concluded that “[i]f higher female labor participation is supported by the right policies, it need not reduce fertility. To make full use of their national pools of female talent, governments need to remove obstacles that make it difficult for women to combine work with having children. This may mean offering parental leave and child care, allowing more flexible working hours, and reforming tax and social security systems that create incentives for women to work.”

Making better use of women’s skills is not just a matter of fairness. Greater and more equitable participation by women in the labor market could help to offset the effects of an aging, shrinking population and hence give lift to Japan’s economic growth over the years to come.

Debbie Howard is Chairman of CarterJMRN and President Emeritus of the American Chamber of Commerce in Japan.

Originally Published in Nikkei Weekly, 10th March2008

CarterJMRN is a strategic market research agency that has been helping clients with consumers and businesses in Japan and beyond since 1989.

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