Tuesday, July 11, 2006

Japan: Slowing Retirement; Is It Working?

In an effort to slow retirements in Japan, the government recently revised legislation to require companies to choose one of three options: push back the retirement age to 65, abolish retirement age altogether or give would-be retirees the option to work part time. According to a Reuters report, a "survey by the Ministry of Health, Labor and Welfare last month showed that 96 percent of companies polled had abided by those changes, but some economists expressed doubts that a fundamental change would occur."
"The legal changes are flawed because there's no punishment for failing to follow through with them," said Tomoyuki Ohta, senior economist at the Mizuho Research Institute. "I doubt the measure will stop many baby boomers from retiring, and once they're out of a job, it would be difficult for them to find new work with conditions they'd be satisfied with."

A Mizuho Research survey of 787 companies showed that on average, about 22 percent said they would continue employing all retirement-age workers who opted to stay, while the rest said they would keep only those qualified or deemed indispensable.
Source: International Herald Tribune "Japan tries to fill gaps before retirement surge" (July 10, 2006)

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