Japan's secret economic weapon: women

TOKYO — In next month’s general election, politicians—nearly all of them men—will make promises on what they will do to fix Japan’s economic morass. Very few of them will even mention women.

The country’s problems are well known: more older people are living longer as the workforce that supports them gets smaller. The result is rising welfare costs and a shrinking tax base.

An influx of immigrants would boost the number of workers, but Japan has little appetite for migration on a European scale.

Observers say the answer lies within: get more of the nation’s women to work.

Christine Lagarde, head of the International Monetary Fund, said last month that women could rescue Japan’s chronically underperforming economy if more of them had jobs.

A Goldman Sachs report in 2010 estimated that Japan’s GDP could jump by a staggering 15% if female participation (currently 60%) in the workforce was to match that of men (80%).

The report says seven out of 10 women leave the workforce after their first child. And only 65 percent of women with a college-level education work.

Women across the board make only 60% of what men make, according to labour ministry data, in part due to a larger number of part-time workers.

Although for some women, staying at home is a positive choice they have made, commentators say for others it is a lack of opportunities.

Japan is ranked an embarrassing 101st out of 135 countries in the World Economic Forum’s (WEF) annual Global Gender Gap Report, down three places from last year. Near neighbour China is at 69th.

“The gender issue is really ignored in Japan,” said Kaori Sasaki, president and CEO of consulting firm ewoman.

“Japan was strong for five, six decades after World War II because a certain group of men occupied top positions in the fields of economy, media and politics,” she said.

“This boys’ network shared the same values and made decisions unopposed.”

But its failure to adapt to the challenges of the last 20 years means Japan has stood still.

Japanese government data shows women account for a mere 1.2% of executives at 3,600 listed companies.

Sasaki said Japanese men need to realise the effort to close the gender gap is no longer a rights issue.

“This is a management and growth strategy,” she said adding scandal-hit companies—including Olympus, which hid $1.7 billion of losses and Tokyo Electric Power, the operator of the crippled Fukushima nuclear power plant—would have been better at dealing with their disasters if they had a more diverse senior management.

“When you try to manage crisis, create products or design services, diversity really counts,” she said.

Saadia Zahidi, the WEF’s head of gender parity and human capital agreed.

“How is the innovation going to happen if you have the same people in exactly the same situation as in the past? So where are the new ideas going to come from?” she said at the launch of a special taskforce in Tokyo last Thursday.

Masahiro Yamada, professor of family sociology at Tokyo’s Chuo University, says it’s not just a case of Japan needing women if it is going to do things better.

Rather he says, it needs women to become workers—and realise the financial gain that this entails—just to survive.

“Unless more women work and get their own incomes, they cannot start a family,” Yamada said.

“Without women joining the workforce, the government’s tax revenue won’t pick up” because the population will continue to shrink, he said.

A lack of childcare makes returning to work difficult for many women; nursery places are at a premium and in any case only usually available during the day.

For some women, the problem is the incompatibility of family life and Japan’s famously long hours, where after-work socialising is almost compulsory.

There are pockets of change, says Hodaka Yamaguchi, 38, whose Tokyo-based IT employer is more sympathetic than many to the needs of its female workforce.

Yamaguchi gave birth to a baby girl in 2009 and came back to a promotion after a 15-month maternity leave. She said her productivity has not fallen despite the fact she is now working six-hour days.

“In this company, working women are well protected,” she said.

Her company allows parents of either sex to take a total of up to six years parental leave—well beyond the 18 months of maternity leave allowed by law.

Although anything above the statutory period is unpaid, the employee’s job is guaranteed.

Ewoman’s Sasaki agrees that things are better than they were, but problems still remain.

“Many young working women say they no longer feel the glass ceiling,” she said. “But I tell them it’s still there. It just moved up.”

© 2012 AFP