[고령자 고용 어떻게②] Looking at Japan-related policies
Must choose between extending the retirement age to 65, continuing employment, or abolishing the retirement age.
Gradual/step-by-step characteristics… 99.9% measures, continued employment 70%
Linked to the age at which public pension benefits begin to be received… Prevent income gap
Efforts to secure employment for those in their 70s… The proportion of retirement age extensions has increased
In Japan, there are quite a lot of companies that employ elderly people, as in the case of ‘Yokobiki Shutter’, an excellent continuous employment company that we looked at earlier. Naturally, the employment rate of senior citizens continues to increase. According to the Statistics Bureau of Japan’s Ministry of Internal Affairs and Communications, the employment rate for people aged 60 to 64 has steadily increased, jumping from 52.0% in 2005 to 73.0% last year. During the same period, the employment rate for those aged 65 to 69 also increased from 33.8% to 50.8%, and for those aged 70 or older from 13.6% to 18.4%.
Japan’s increase in employment of the elderly is partly due to the fact that companies such as Yokobiki Shutter actively hire elderly people or the elderly’s increased motivation to work for themselves, but it is also largely due to the Japanese government’s gradual and step-by-step implementation of the elderly employment policy over a long period of time. It seems to have worked.
As Japan approaches the ‘100-year-old era’, it believes that it is necessary to build a ‘lifelong active society’ where elderly people with the will to work can continue to work regardless of age, and has been seeking measures. In particular, according to the Japanese Cabinet Office, due to the rapid low birth rate and aging population, the proportion of the population aged 65 or older in Japan is expected to increase from 29.1% in 2021 to 31.3% in 2030, 36.7% in 2045, and 38.4% in 2065, and the labor force population is expected to continue to decline.
Accordingly, Japan revised the ‘Employment Stability Act for the Elderly’ in 1994 and has been implementing ‘mandatory retirement age of 60 or older’ since 1998. Retirement age below 60 is prohibited by law. As a result, more than 90% of all Japanese companies currently operate a retirement system, and the number of early retirements before retirement age is very low.
Japan did not stop there and began to introduce ’employment security measures until age 65′ through a law revision in 2000 (enforced in 2001). This means that one of three measures must be chosen: ▲extending the retirement age to 65 years old, ▲introducing a continuous employment system until 65 years old, or ▲abolishing the retirement age. This is also the measure that has currently had the greatest impact on employment of elderly people in Japan.
What is important is that these measures to secure employment for the 65-year-old were implemented very gradually and step by step.
In 2001, the employment security measure for those aged 65 and older was limited to the obligation to make efforts. The legal obligation has been in effect since 2006. Even in cases where the continuous employment system was chosen, the impact on the company was alleviated and the burden was reduced by allowing the target to be selected through labor-management agreement. Since 2013, the selection of candidates has been banned and continuous employment is mandatory for all applicants. However, companies that have already selected recipients before then can postpone until 2025.
As a result, according to Japan’s Ministry of Health, Labor and Welfare, the number of companies that implemented measures to secure employment for 65-year-olds was 235,620 last year, accounting for 99.9% of the total. This means that almost all companies are taking action based on the law. Among these, the companies that introduced the continuous employment system were the largest at 70.6%. This was followed by extension of the retirement age at 25.5% and abolition of the retirement age at 3.9%.
What is particularly noteworthy is that these measures to secure employment at age 65 were implemented in conjunction with the ‘age at which public pension benefits begin to be received.’
Japan’s public pension includes the ‘basic pension’ (national pension) for all citizens and the ’employee pension’ for office workers and public officials.
It is easy to understand the Employees’ Pension as Korea’s national pension. Looking at the supply and demand status, as of 2019, the basic pension receipt rate is 77.3%, and the monthly average benefit amount is 56,000 yen (480,000 won). On an annual basis, it amounts to approximately 5 million won. The employee pension benefit rate is 67.6%, and the monthly average benefit amount is 146,000 yen (1.26 million won), which means you can receive about 15 million won per year.
The problem is that, as aging has intensified, the starting age for Japan’s public pension has been gradually raised from 60 to 65. The basic pension has been adjusted upward by one year every three years since 2001, and the employees’ pension has been adjusted upwards since 2013. This means that people worked until the retirement age of 60, but pension is paid starting at 61, which could result in no pension or no income.
However, Japan simultaneously promoted measures to secure employment at age 65 during this period, making efforts to match the timing to prevent an income gap from retirement age to pension receipt. When the basic pension eligibility age was raised in 2001, efforts to secure employment were mandatory, and when the welfare pension eligibility age was raised in 2013, full employment security measures were mandatory. This means that a stable policy has been promoted through meticulous and step-by-step preparation over a long period of time.
Akihiro Shukuri, head of the Senior Employment Policy Division at the Ministry of Health, Labor and Welfare, said, “There is not much time left until the age for receiving public pension (employee pension) will be extended to 65 years old, to 2025.” He added, “In that respect, the measures to secure employment until the age of 65 are almost complete.” “I think,” he said.
In addition, Japan is also implementing the obligation to make efforts to secure employment until the age of 70 from 2021. As with the measures to secure employment at age 65, ▲extending the retirement age to 70 years old, ▲introducing a continuous employment system until 70 years old, ▲abolishing the retirement age, ▲making a work entrustment contract until age 70, or ▲engaging in social contribution projects until age 70. An obligation to make efforts has been added to select one of ‘measures other than employment’, such as introducing a system that allows employment.
Manager Shukuri said, “Elderly people over 65 years old also have a desire to continue working, and the overall labor force population is decreasing, so we have taken measures to secure employment for those in their 70s to respond to that problem.” He went on to explain, “In the case of people after the age of 65, the needs (desires) for why they should work are quite diverse, so in order to respond to this, we have created opportunities to get jobs outside of the company.”
However, since it is still in the early stages of implementation and it is a mandatory period of effort, the number of companies implementing employment security measures for 70-year-olds (27.9%) is lower than that of companies implementing employment security measures for 65-year-olds (99.9%). Manager Shukuri said, “There are questions about when employment security measures for those in their 70s will be made mandatory, but it has not been decided. Since it is still below 30%, I think we need to support more companies to implement it now.” He said.
In this regard, Japan also operates various employment support systems for the elderly.
For example, the Employment Support Organization for the Elderly, the Disabled, and Job Seekers (JEED) under the Ministry of Health, Labor and Welfare provides subsidies to promote employment for the elderly and provides counseling and assistance to business owners and the elderly through employment promotion planners and advisors for those in their 70s. In particular, in cases such as extending the retirement age to 65 years or older, abolishing retirement age regulations, or introducing a continuous employment system for all applicants, a minimum of 100,000 yen (870,000 won) to a maximum of 1.6 million yen (13.96 million won) per company depending on the target employee. Subsidies are provided up to
Meanwhile, it is important to note that while the introduction of the continuous employment system, which has accounted for the largest proportion of employment security measures for the 65-year-old, is gradually decreasing, the proportion of retirement age extension and retirement age abolition is increasing. This is because the trend of companies hiring older people is moving from continuous employment to extending or abolishing the retirement age.
Regarding this, Manager Shukuri said, “There is a need to investigate and analyze more closely, but it appears that the flexibility of the continuous employment system will be reduced as the measures to select those eligible for continued employment will soon end.” However, he said, “I think it is a measure to actively utilize the elderly by extending the retirement age, etc., not only for such passive reasons, but also because of the expectation that even the elderly can demonstrate their abilities to the fullest.”
Manager Shukuri, however, said, “We have no intention of removing the option of the continuous employment system (among the measures to secure employment for 65-year-olds and 70-year-olds) and extending or abolishing the retirement age,” adding, “When considering future employment policies for the elderly, we need to consider changes in employment practices. “We will accurately capture and implement consistent policies,” he said.
[도쿄=뉴시스]
Source: Donga
Mark Jones is a world traveler and journalist for News Rebeat. With a curious mind and a love of adventure, Mark brings a unique perspective to the latest global events and provides in-depth and thought-provoking coverage of the world at large.