One-third of Japanese companies keep workers employed until 70

It has been found that Japan, a country faced with a declining and aging population, currently sees around one-third of all businesses giving employment opportunities to workers of up to 70 by promoting re-hiring programs during their post-retirement years. Japanese workers are, by law, entitled to work by 65 at almost all companies.

As reported by the Japanese Ministry of Health, Labor, and Welfare in its status report on the employment of senior workers issued on Friday, as of June 1st this year, approximately 75,600 out of 237,052 businesses with 21 or more employees on the payroll provided job opportunities to those aged up to 70, up by 2.3 percent points from the previous year, making these companies account for 31.9 percent of the total corporate world. It was also found this year, consistent with last year’s results, that 99.9 percent of Japanese companies allow workers to stay on the payroll until the age of 65.

The ministry has confirmed that nearly all Japanese companies today re-employee their workers after they surpass the retirement age of 60; or remove or raise the retirement age system. Even with the legal retirement age still set at 60, businesses are required by law to choose one of these three options to keep their workers on the job until the age of 65 if they intend to continue to work.

What’s more, Japanese law stipulated back in 2020 that companies should fulfill their obligation to “try their best” to secure job opportunities for workers up to 70. Apart from abolishing or extensioning the pre-existing retirement age program, businesses have adopted various measures such as consignment contract programs or community service projects to provide continued employment for workers. The Nikkei Newspaper quoted an official from the health ministry saying that the government promises to support senior workers who are willing to remain in the workforce, considering the shrinking labor pool due to low birthrates and an aging population.

Meanwhile, some critics say that further action is needed, arguing that the legal retirement age should be raised from 65 to 70 to create a more conducive environment for older workers. As per data issued in September by the Japanese Ministry of Internal Affairs and Communications, 36.25 million of the total population were 65 and above, making up 29.3 percent, higher than its Korean counterpart’s share of 19. 3 percent.


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