Japan needs bigger ‘sense of crisis’

woeful record on female employment was compounding the problems of a society that was getting old fast.
“The top 10 percent of Japanese earn 10 times more than the bottom 10 percent,” worse than the average of the 34 OECD member states, he told a forum of journalists, diplomats and academics in Tokyo.
The income gap between men and women — the second largest in the OECD behind South Korea — was a glaring example, he said.
“Women are under represented in Japan’s labour market. When they do participate, they are over-represented among non-regular workers. This widens the gender gap in Japan,” he said.
Gurria said Japan needs to address this inequality to help mitigate the problems associated with its rapidly ageing population.
“Already you are the oldest workforce in the OECD. Without incorporating women, you are going to have a very fast decline and, of course, the only way which you can compensate for that is active immigration policies.
“We have to make it attractive for women to get back in to jobs. This is a priority for Japan.”
Japanese companies, which once provided generous benefits and life-time employment for workers, have increasingly shifted to more part-time or contract workers to cut hiring costs.
Gurria, who arrived in Tokyo bearing a book entitled “Policies for a Revitalisation of Japan” was speaking just days after a think tank warned Japan could fall out of the league of developed nations by 2050 as its shrinking and greying population and slowing productivity make its economy contract.
The 21st Century Public Policy Institute, linked to Japan’s powerful Keidanren business federation, said last week in the most pessimistic scenario, GDP will shrink to the point where it is no longer among the the world’s top economies.
But the think tank also said if policymakers could boost workforce participation by women to the same level as that of Sweden by 2040, Japan could still be the world’s fourth largest economy by mid-century.
Years of anaemic growth and unsuccessful pump priming by successive governments have burdened Japan with public debt equivalent to twice GDP, with analysts warning only higher tax revenues or spending cuts can bridge the gap.
Gurria said it was vital that Prime Minister Yoshihiko Noda’s unpopular plan to double the current 5 percent sales tax by 2015 was allowed to succeed. — AFP.