Working hours decline despite rising labour participation in Japan

Japan’s labour force has increased due to rising labour participation by females and seniors, despite a decline in the working-age population. However, hours worked per capita have been on a downward trend, increasingly weighing on GDP and household incomes.

What you will learn:

• Most females and seniors work part-time and their average working hours have been declining. In addition, the working hours of full-time employees have also started to decline in recent years due to the legislation to restore a better work-life balance.
• More part-time workers with shorter working hours have depressed economic growth from the supply side through a decline in labour input and stagnation in productivity. A higher proportion of low-paid workers have also dragged down household incomes and domestic demand.
• When discussing the long-term macroeconomic implications of ageing, we need to consider not only labour participation but also the working style of an aging society, especially working hours per worker.