Is Japan willing to embrace multiculturalism to address its labour shortage?
Pascal Samfat
Japan has begun the process of opening its doors to skilled immigrants to fill its labour shortages. There has been public discourse around whether mass immigration is required to stimulate Japan’s economic growth, but is this the best or most realistic solution?
What is causing Japan’s workforce woes?
Japan’s current economic struggles are partly due to a significant labour shortage, which in turn is caused by a rapidly ageing population, low birth rates and a lack of immigration. Japan has the largest elderly population of any country with 29.1% of its population (approximately 36 million people), aged over 65. This is partially attributable to Japan’s birth rapidly increasing immediately after World War 2, with the state recording 2.5 million births annually from 1947-1949.
However, Japan’s birth rate has been declining for several decades. This is largely the result of economic growth in the 1960s and 1970s which provided women with equal education and employment opportunities, causing a drastic decline in marriages. Since Japanese culture places emphasis on marriage before childbirth, this greatly contributed to the declining birth rates.
The rising cost of living is further exacerbating the declining birth rates in Japan; according to several economists, Japanese households will have to budget an extra ¥29,000 (US$206) per person in 2024. The high cost of living is seeing families cut back on purchasing groceries when considering households need to spend ¥301,975 (US$2,075) to cover other expenses such as housing, electricity bills and education costs.
Furthermore, Japanese women are increasingly hesitant to have more than one child due to cultural expectations on women to do the primary care. In 2019, 63.4% of women in their 40’s admitted to having to balance long work hours and endure the burden of being primarily responsible for housework and childcare. Consequently, most women are hesitant to have more children since they are unwilling to jeopardise their career and place pressure on themselves to care for kids.
The last time Japan’s birth rate exceeded 1 million was in 2015. Within the past eight years, the number of births has dropped by 30%, and in 2023 there were only 758,631 new births in Japan. These statistics reveal a bleak economic future for the Japanese economy: if this downward trend continues, the population will decline from 124 million in 2024 to 87 million by 2070.
In 2020, the government created a ¥3.5 trillion incentive to boost the country’s low birth rates, promising financial support for those who choose to grow their families. However, this has not yet proven to be successful, partially due to Japan’s work culture, where employees are expected to work long overtime hours and not leave their offices until their bosses do. For Japan to successfully increase its birthrates, the state must first develop a culture of work-life balance and abide by the standard working hours. Japan’s younger generations are increasingly prioritising work-life balance since the Covid-19 pandemic has shifted cultural attitudes towards more individualism, whereby now only 30% of young Japanese favour the traditional corporate culture of working 60 hours per week to climb the corporate ladder. Thus, parents can utilise the financial incentives and have more time to care for children.
Increasing immigration: a challenging solution
The solution to Japan’s demographic challenges appears straightforward, with economists arguing that the government needs to drastically increase its intake of foreign workers to address the labour shortages. It is asserted the promotion of multicultural policies is imperative to maintain economic growth and promote egalitarian viewpoints in respecting different cultural beliefs in an increasingly diverse society.
Japan is resisting mass immigration based on the notion that an ethnically homogenous society can reduce crime rates, maintain the country’s rich cultural heritage and promote social order. According to the Japanese constitution, foreigners residing in Japan are granted equal rights to Japanese citizens such as being able to access social security services including National Health Insurance, National Pension and a child rearing allowance. Foreigners also have equal rights to reside in Japan for work or educational purposes.
However, despite Japan being the oldest liberal democracy in Asia, there are still issues with the government respecting the rights of immigrants to access equal economic and social opportunities as the Japanese people. For instance, after WW2 concluded, the majority of Koreans who were residing in Japan at the time decided to return to Korea since the Japanese government redefined the state as ethnically homogeneous. As of 2024, 1 million Koreans still maintain permanent residency in Japan but cannot obtain Japanese citizenship despite five generations of their families having lived in Japan. As a result, Koreans are still viewed as ‘others’ by mainstream Japan since they cannot vote in Japanese elections and are more likely to experience racism and discrimination.
Evidently, Japan has a long way to go in building a more inclusive society to ensure all ethnic and cultural minorities have equal opportunities. Japan developed the Multicultural Co Living Policy in 2005 with the aim of encouraging foreign migrants to reside in Japan and to recognise differences in culture. This was seen as a first step for Japan to give equal opportunities for foreigners in housing, education and employment. A major obstacle, though, is that most prefectures in Japan discourage multiculturalism since foreigners are viewed as a problem. Further, there exists a societal expectation of foreigners to assimilate into dominant culture by learning Japanese and moving away from their traditional beliefs.
Generally, Japan exhibits a lack of tolerance and education regarding multiculturalism. Although Japan’s educational curriculum does include the histories of different countries, there is insufficient education on cultural diversity and awareness of different cultural systems. Japan should consider improving its multicultural education to promote cultural diversity and inclusivity. Japan’s international schools can play an important role in teaching cultural diversity, with the educators encouraging the celebration of cultural differences. This is viewed within the education sector as an important step towards allowing students to thrive in an increasingly interconnected world. This would be beneficial in mainstream Japanese education, not just international schools.
While Japan seems to be opening to immigration, there are steps that must be taken before it can become an effective solution to its economic challenges. Specifically, Japan must undertake shifts in its attitudes towards multiculturalism on a societal level. In the meantime, the country may have to peruse other options to effectively address its labour shortages.
Japan’s Alternative Solutions
Japan is a culturally unique country has its own plans to manage its economic future, potentially contributing to its hesitance to follow global trends in embracing cultural diversity. To combat its labour shortage, Japan is instead leading the way in robotics which will contribute to transforming their society. Japan’s expertise in robotics has proven to be so beneficial in manufacturing, that it is now introducing this technology into other industries including agriculture, aeronautics, medicine, disaster mitigation, medicine, and caregiving for the elderly. Robotics is making such a positive impact that it is being considered as “The Fourth Industrial Revolution”.
Additionally, Japan and Thailand have a history of solid bilateral relations. Due to the declining value of the yen, Japanese companies have been relocating to Thailand since the 1980s, with 6,000 Japanese companies currently operating in Thailand. This mainly consists of computer/computer parts, machinery, and automobile manufacturing companies. In 2007, both nations signed the Japan-Thailand Economic Partnership Agreement to expand trade networks and economic ties. Furthermore, Japanese car manufacturers will invest US$4.34 billion into Thailand within the next five years to manufacture electric vehicles. This is highly beneficial for both economies since Japan does not have the required labour force for manufacturing. This investment will allow Japan to address this labour shortage by employing people in Thailand to manufacture their goods.
Given there are several speculations about Japan’s decline from the world’s third to fourth largest economy, Japan is taking a stance to maintain its cultural heritage. But Japan is not giving into international pressure to adopt multiculturalism, instead opting to take a unique approach to manage its labour shortages and in turn its economic future.
Pascal is currently studying a Bachelor of Politics and International Relations at Australian Catholic University (ACU). He recently completed an overseas exchange program studying Japanese Language and International Studies at Toyo University, Tokyo. As a part of this exchange program, Pascal undertook a class in Multiculturalism in a Globalising World which sparked his interest to write this article of multiculturalism in Japan.
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