You’re never too old….in Japan

May 26, 2014
Lee Chapman,
Lee Chapman,

I’ve just visited the country with the oldest population in the world and the biggest government debt. It should be a basket case. And that’s how some describe Japan. Its economy has stagnated for two decades. It’s held up as a warning to the rest of us: look what happens when one-quarter of your population is 65 and over (Australia won’t face that until 2050). Look what happens when the number of young people to support them is shrinking. And look at that crippling government debt. (Japan’s net government debt as a percentage of Gross Domestic Product is 134 percent; Australia’s is 11 percent – and they say we have a crisis!)

I went to Japan for a holiday, to see the cherry blossoms. But I also wanted to observe and learn about the impact of its ageing population. The rest of the developed world is heading in the same direction of falling birth rates and longer life spans. Japan’s just got there first. Its birth rate of 1.39 is one of the lowest in the world. And its life expectancy is the highest – for women an incredible 87 years (Australia 84.6). I don’t pretend five weeks there make me an authority. Most of what I learnt was from reading the experts. To my surprise not everyone agrees Japan is an economic basket case. Some even see it as a model for a world threatened by climate change and over-population. Japan is still rich, happy, safe and fully-employed, and that’s not supposed to happen with 20 years of economic failure, and a shrinking, ageing population.

But first let me tell you what I saw: old people everywhere. Everyone’s out in cherry blossom time to welcome the spring, and enjoy sake parties and picnics under the blossom-heavy trees. The elderly were more visible than in Australia – walking briskly even on walking sticks or frames. They were on the buses and in the trains. I didn’t notice any Asian “respect for the elderly.” The young didn’t spring to their feet to give up seats on public transport. But the Japanese 80-plus brigade seemed incredibly spry and hardy, and no-one was fat. So maybe they’re just more physically fit; maybe years of using squat toilets, and sitting on floors (and having to get up) has made for flexible, strong bodies. And their diet is healthy.

This is also what I saw: the famed inter-city trains, including the Bullet, that never run late; metro trains within cities; clean streets without rubbish or potholes; people driving new (small) cars. There’s no graffiti or begging. If this is a basket case, it doesn’t look too bad. Also, Japan is the safest country in the world, according to the World Justice Project. Its unemployment rate is 3.6, and its youth unemployment rate under 6 per cent compared to ours at over 12 per cent. Perhaps a benefit of an ageing society is more jobs for the young. But on the other hand, the elderly are no slouches: the average age for men to leave the workforce is over 69 even though they could get the age pension at 61. One of the women I met, Toshiko Honda, worked in a ryokan – a Japanese-style hotel – at a physically-demanding job. She had to serve food on her knees at floor-level coffee tables and climb up and down stairs as well. She was 64 and told me she loved her job and wanted “to work for ever.”

And by the way, Japan is the world’s third biggest economy. Its young people perform brilliantly in exams under the Program for International Student Assessments, coming 4th out of 65 countries in 2012 in both reading and science (Australia 19th and 13th), and 7th in maths (Australia 16th). To describe Japan as a failure is to miss out on this other side of the story,” says David Pilling, author of Bending Adversity, a book about modern Japan.

But if Japan has a problem, it’s not so much its ageing population; it’s the attitude to its young women. Women have gone on a baby strike because Japan is a country where it’s particularly hard to have children and a career. Long work hours, lack of childcare, and sex discrimination are factors. So women are opting for work not babies. The government is trying hard to tackle this discrimination to boost the birth rate and the ranks of future tax-payers.

Even now, the Japanese seem ready to help pay for their growing elderly population. Daughters-in-law have traditionally been charged with looking after old people but by 2000 that system clearly wasn’t working. In a radical move the government introduced a long–term care insurance scheme – a kind of longevity levy ({Paul Keating suggested something similar) to help pay for the health and aged care of its retirees. A by-product is the development of small “homely” care homes for dementia patients and a popular network of daycare centres for the frail old.

Japan is still working out its demographic challenge. Doubtless, it can learn much from Australia. Collapse under debt, pension and care costs is still possible. But so far it’s defied the pundits who’ve long predicted doomsday. If we’re as healthy and fit in our 80s as the Japanese I saw strap-hanging on the buses, we could call ourselves lucky.

Do you think low-growth economies are the way of the future? Please leave a comment.

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