Japan’s diligent and struggling working poor are essential strivers

It is heartbreaking, and yet so common, to see old men in the 70s manning construction and car parking sites in Japan, waving traffic control lights in blue uniforms and apologizing to passing-by pedestrians for the inconvenience, even under the scorching summer sun or in shivering winter months. More than one third of those aged 70 and 74 are still in the workforce (and more than half of the age group between 65 and 69), mostly engaged in low-paid part-time assignments.

Japan’s 30-Year wage stagnation and growing income inequality

Far from the past glory of being the world’s leading economy, Japan now has a higher poverty rate among the working-age population, compared to other wealthy nations. More than 10 million people in Japan live on less than $19,000 a year, while one in six is in “relative poverty,” earning less than half the national median.

This decline has been long in the making. Japan’s wage level has remained flat for 30 years, due in large part to the widespread practice of non-regular employment (inclusive of part-time, contract and temp workers). With the deregulation of the labor market in the 1990s, the share of non-regular workers has increased steadily, now constituting 40% of the workforce. This is not only the case in private businesses but government agencies, hospitals, nursing homes and other essential services.

Three decades later, nearly half of those in their 40s and above, who should be at the peak of their career development and who are also likely to be raising and caring for family members, are faced with job insecurity, little saving and potential pension collapse, given the country’s fast-aging society.

Who qualifies public assistance in Japan?

Japan’s public assistance programs are mostly geared toward the elderly, disabled or sick, which excludes the working poor. Moreover, since eligibility for public assistance is based on the minimum level of household income, it can disincentive recipients from seeking employment. Many working poor opt out of public assistance for fear of social stigma as well.

Tokyo Governor addresses income gap in high school education

As one of the measures to tackle this dilemma, the Governor of Tokyo announced in December 2023 to lift the income threshold for public assistance on high school tuition. Nationally, households earning less than 9.1 million yen (approximately 607,550 USD) a year have been waived of secondary school tuition in public high schools, while Tokyo has topped it up with a subsidy of up to 470,000 yen (approximately 3,170 USD) for private high school tuitions.

Now Tokyo plans to offer the same to all households, regardless of income levels, from April 2024. Osaka Prefecture has indicated to consider a similar measure to be introduced gradually.

Dedicated support to ease conditions of the working poor, such as above, would certainly be helpful. Yet only the wealthiest prefectures, such as Tokyo and Osaka, can afford these initiatives. Aid is most needed when it is least available. Can Japan overcome the “lost generation”? It begins with supporting the working poor, individuals deserving fair wages and rest, including hard-working parents striving to provide quality education for the next generation.