Recently I learned that Japan hosts a Soren Kierkegaard Research Center. While the Danish philosopher may have known little of Japan, his existential writings appear to be popular here. He once said “life is not a problem to be solved, but a reality to be experienced.” This resonates with me, as for many years, the International Organization for Migration (IOM) has been saying that migration is not a problem to be solved, but an opportunity to be managed.
Kierkegaard also said “life can only be understood backwards, but it must be lived forwards.” As Japan comes to terms with the reality that its population is aging and shrinking, many commentators jump to immediately conclude that inward migration is the cure-all. It won’t be. In part because Japan’s demographic trend can’t be cured quickly but has to be managed creatively.
Instead of forcing the issue that migration should be a solution to Japan’s aging and shrinking population, it should rather be taken as an opportunity where Japan could enhance economic growth, spur productivity and strengthen competitiveness in the global market economy.
Migration is not the only solution to address gaps in skills and talents in developed economies but no doubt that it has to be part of the solution. For that part of the solution to be realized, effective policies are needed particularly in attracting and retaining foreign skills and talents. “Understanding backwards” if you will.
Japan’s population in 2015 was estimated at 126.6 million — 26.8 percent of whom were aged 65 or older, according to the National Institute of Population and Social Security Research. In 30 years, this population will see a 19.3 percent decline, and in 50 years, 35.7 percent. During the same periods, the ratio of senior citizens will increase to 37.7 percent, and then to 40.4 percent. Five decades ago, the ratio between workers and retirees was 12 to 1. If current trends continue, five decades hence it will be parity, a population “balance” that threatens to upend all other economic equilibria.
Let’s stay with the concept of understanding backwards. Though its impact may not occur or be felt simultaneously, an aging and shrinking population can mean many things. Obvious ones include fewer workers; fewer taxpayers; fewer consumers; fewer producers; increasing cost of elderly care; fewer contributors to pension schemes; fewer children; fewer schools and universities; limited innovative ideas; and regression of technological advancement.
Japan’s economy, the third-largest in the world, is largely dependent on the export of innovative, affordable technology. With an aging and shrinking workforce, the reputation of Japan Inc. may be difficult to sustain. How to address this?
One route may be through accepting foreign workers with targeted skills; another is to move work overseas where workers are available and cost less. The latter could mean fewer work opportunities for the local workforce, while the former could spell a revitalized economy with a fresh workforce complementing locals.
Thomson Reuters last year surveyed major Japan-based firms on the notion of having foreign workers in their workforce. A hefty majority of 76 percent supported the idea.
Before seeking foreign solutions to local labor gaps, pundits could argue the importance of assuring that the mismatch of labor is addressed, indigenous resources maximized and the possibility of automation explored.
A mismatch occurs when workers have fewer or more skills than the job requires. Depending on various factors, such a mismatch could be inevitable, avoidable or structural. These factors may include an unattractive working environment, noncompetitive salaries and benefits, gender discrimination, poor recruitment practices, unequal treatment of employees, challenges in recognition of skills and qualifications, and gaps between location of skills and available jobs.
Facilitating greater inclusion of all available indigenous resources, including youth, women, elderly and the disabled, is any government’s interest. In Canada, employers are required to undergo a labor market impact assessment to ensure that entry of a foreign worker does not negatively impact the local market. This process includes an assessment of whether the job offer is genuine, meets prevailing wages and conditions of employment to ensure parity with Canadian workers, and that qualified Canadian workers are not readily available to fill the job.
Automating work is another way, thanks to advancements in technology. However, robots don’t pay taxes, they are not consumers, nor do they contribute to the pension scheme. Nor do they vote. Automation can be a supplement but cannot be a replacement for labor gaps that come about due to human population aging and decline.
Human mobility poses degrees of challenges to governments, policymakers and practitioners. Japan is no exception. At the end of the day, it is the government that will decide who should enter and who should stay in its territory; for what purpose these people can enter and for how long; and what measures could be taken should there be irregularities, conscious of international laws, protection of human rights as well as humanitarian obligations.
There are common standards for migration management, which could help Japan understand backwards as it lives forward, e.g., one that ensures the protection of the human rights of migrants; one that does not compete with but complements local labor; one that promotes the harmonious coexistence between migrants and host community; one that is balanced, multidisciplinary, consultative and collaborative.
William Barriga is chief of mission of the International Organization for Migration (IOM), Tokyo. He previously headed the Labor and Facilitated Migration Division at the IOM headquarters in Geneva.
IN FIVE EASY PIECES WITH TAKE 5