Research Briefing | Sep 5, 2022

Working hours decline despite rising labour participation in Japan

Japan Working hours decline despite rising labour participationJapan’s labour force has increased due to rising labour participation by females and seniors, despite a decline in the working-age population. However, hours worked per capita have been on a downward trend, increasingly weighing on GDP and household incomes.

What you will learn:

  • Most females and seniors work part-time and their average working hours have been declining. In addition, the working hours of full-time employees have also started to decline in recent years due to the legislation to restore a better work-life balance.
  • More part-time workers with shorter working hours have depressed economic growth from the supply side through a decline in labour input and stagnation in productivity. A higher proportion of low-paid workers have also dragged down household incomes and domestic demand.
  • When discussing the long-term macroeconomic implications of ageing, we need to consider not only labour participation but also the working style of an aging society, especially working hours per worker.
Back to Resource Hub

Related posts

Japan Key themes 2024

Post

Japan Key themes 2024 – Will wage-led inflation gain momentum?

Inflation will likely decelerate in 2024 as the impact of imported inflation wanes. We expect the Bank of Japan will end its negative interest rate policy in April after confirming a high wage settlement. But our medium-term projection is that a zero-interest rate policy will take its place and last for years.

Find Out More

Post

Asset Allocation Key Themes 2024 – Risky assets are not out of the woods

We think risk assets will underperform in 2024. We map out the implications of our key 2024 global macro themes for asset allocation.

Find Out More
Wage rises in 2024 look set to be as high as this year

Post

Wage rises in 2024 look set to be as high as this year in Japan

More market participants appear to have become confident that the wage-driven inflation is real, which will encourage the Bank of Japan to start normalizing its super-accommodative monetary policy in 2024. We revised up our projection for the spring wage settlement in 2024 to match the strength of the settlement in 2023. We believe that wage increase will continue after 2025, but achieving wage-led 2% inflation is still a long way off.

Find Out More