Japan’s labor has long been characterized by very long working hours and a limited ability to take vacation. The failure to achieve what many would consider necessary work-life balance has a range of social and economic implications. As one example, efforts to increase the comparatively low level of female labor force participation have so far had disappointing results, in part because long and inflexible work hours make it difficult for families to have two earners.
The stressful work environment can be seen most dramatically in the concept of karoshi, or “death by overwork.” As seen in the attached article, data on clams for compensation for such deaths indicate that they have risen in recent years, in particular for women.
Why should such deaths have increased in recent years? One possibility is that it reflects increased labor shortages, in the context of an aging and declining population. Labor shortages have emerged throughout the economy, for example in construction and services. Typically, a tight labor market would be expected to lead to increased hiring, made possible by higher wages. But neither are happening much in Japan. Real wages have declined in the last several years (as a consumption tax hike raised the cost of living but did not lead to fully offsetting wage increases) and employment hasn’t risen sufficiently. The obvious sources of additional employment–female workers or immigrants–are held back by a combination of legal obstacles and social norms.
So, existing workers seem to be bearing the brunt of the labor shortage. With few limits on overtime in Japan, adjustment by employers has take place in a manner that makes the lives of many workers in Japan more difficult, in some cases with tragic results. This underlines the need for deep reforms of the Japanese world of work.