The Abe government has succceeded in its bid to increase the number of women in Japan's labour market but there are plenty more gains still to be had in the pursuit of what has become known as ‘womenomics’.
Last year the Japanese female labour participation rate powered past that of the US to hit 66%. Of course this is a broad brush measure. Not all jobs are equal and now there is a new source of data to draw on that is adding more texture to the big picture. In April 2016, Japan's Women Active Participation Promotion Law came into effect. This requires private and public sector organisations with more than 300 employees to set and disclose diversity targets and reveal a wealth of other gender data including hours worked, duration of employment and the ratio of men to women in management. This information is invaluable in helping to direct future policy (even though it is not complete as organisations are not held accountable if they don’t comply with the law).
What is becoming increasingly clear are patterns of employment. While female labour participation overall has increased, women are still over-represented in the category known as irregular workers (part time, contract or casual). The societal norms that, until recently, meant gender equity was rarely discussed in Japan are, it seems, still alive and well. Expectations of what women will do in the home and in regard to childcare help keep women in irregular work which, in turn, hinders career progression.
And, in a not uncommon finding worldwide, women in Japan do not get equal pay for equal work. In fact, according to the World Economic Forum’s 2016 Gender Gap Index, Japan has slid down the ladder, falling 10 places from 2015 to be ranked 111 among 144 countries surveyed.
The ruling Liberal Democratic Party (LDP) is looking to tax policy to help. The spousal tax break, introduced back in 1961 is a tax deduction of JPY380,000 ($4399) for a household’s main earner. This currently cuts out if the dependent spouse earns more than JPY1.03 million ($11,925) a year so many married women limit their working hours to keep their income under the threshold. The LDP wants to raise the maximum spouse income to JPY1.23 million($14,241) to provide an incentive for women to work more.
This tax change will likely succeed in increasing the number of women seeking employment to some extent. However, greater societal change is needed to alter the Japanese work culture in the longer term. In 2014 Shinzo Abe announced his intention to bring about a world in which all people, women and men - shine in his opening speech at the World Assembly for Women in Tokyo. There are plenty of ways in which the government and business can help make this happen, such as legislating equal-pay-for-equal-work and creating more flexible work environments.
The emergence of ‘womenomics’ as a key pillar in Abe’s ambitious economic plan has made advancing gender equality part of the political agenda. There is now sustained pressure for the consideration of gender-based issues in the workplace, and in the broader social sphere. As a leader of this conversation, the government is in a unique position to challenge existing gender-stereotypes and champion change. Through championing gender diversity within the workplace, the Japanese Government can confront economic, demographic and social issues.
There is every reason to expect the current administration will continue to push gender equality in the workplace as a key element of the nation’s growth strategy. How effective such efforts will be is yet to seen. Japan is a society that values tradition and, to some extent, that equates to resistance to change. Goldman Sachs vice chair and chief Japan strategist Kathy Matsui, who coined the term ‘womenomics’ has a different read. Matsui said: 'Japan takes a long time to decide to change, but given homogenous nature of this society, once change starts, my advice is: don’t blink.'