Japan revamps job system to tackle ageing population

Japan is embracing technological innovation, employment reforms and preventive healthcare, as its ageing population presents increasing challenges to sustainable economic growth.

During a recent academic panel on Japan's demographic crisis held at Hitotsubashi University in Tokyo, Prof Shinya Yamashige from the university's Graduate School of Economics and International and Public Policy discussed how Japan became Asia's first super-aged society in 2006.

He noted that the country has spent decades adjusting to the challenges posed by demographic decline.

The country's response initially centred on industrial automation, information technology, employment policies and elderly care, with artificial intelligence emerging more recently as another means of boosting productivity.

Japan is also pursuing advances in low-orbit space ventures, semiconductor manufacturing and biomedical innovation, seeking new revenue streams, career opportunities for younger generations and greater economic security.

Despite these economic ambitions, Japan continues to grapple with declining fertility and delayed family formation, raising questions about the wider social implications of technological change.

Prof Yamashige cited research by the University of Cincinnati examining possible links between digital technology use and fertility-related behaviour, although such associations do not necessarily establish a causal relationship.

Against this backdrop, the country is placing greater emphasis on extending healthy working lives, retaining older employees and strengthening workforce skills.

Under Japan's Act on Stabilisation of Employment of Elderly Persons, employers must secure opportunities for workers up to age 65 and make efforts to provide opportunities up to age 70.

Workplace redesign, flexible employment arrangements and digital training, including AI-related skills, could help older employees remain productive as job requirements evolve.

However, skills development remains a challenge. According to a 2025 OECD analysis, only 29% of Japanese workers aged 55–65 participated in training, compared with 35% across OECD countries.

Beyond the issues raised at the forum, Japanese government policies also reflect a growing emphasis on preventive healthcare as a means of preserving workforce capacity and containing the economic burden of chronic illness.

AI could help accelerate drug discovery, support diagnostic imaging in regional hospitals facing staffing shortages and improve patient monitoring.

However, its effectiveness depends on clinical validation, adequate infrastructure and trained personnel.

Revised workplace health guidelines issued by Japan's Ministry of Health, Labour and Welfare, effective from Oct 19 this year, place greater emphasis on early disease detection, medical examinations and follow-up treatment.

The guidelines encourage employers to work with medical insurers to promote screening for cancer, dental diseases, osteoporosis, eye conditions and women's health concerns, while supporting employees who continue working during treatment.

The guidelines do not require companies to finance every additional screening.

Japan's experience also offers lessons for Thailand, where, according to the National Statistical Office's 2025 Population and Housing Census, 21.4% of the population was aged 60 or over.

Facing similar demographic pressures with more limited economic resources, Thailand must also confront the challenge of sustaining productivity while supporting a growing elderly population.