Japanese response to an aging labor force

Slowing population growth in Japan has led to concern about aging of the labor force in the context of the seniority wage and lifetime employment systems. There is no question that the labor force will age rapidly in the future. However, Japanese labor force institutions are more flexible than most Western observers have thought, and appropriate response to the changing demographic situation has already begun. The Japanese government and private enterprises are devising innovative policies for accommodating an older labor force.The author thanks the staff of the East-West Population Institute for assistance in the production of this article. In addition, the support of the Nihon University Population Research Institute is gratefully acknowledged.