Open Editor’s Digest for free
Rula Khalaf, editor of the Financial Times, picks her favorite stories in this weekly newsletter.
Merchant, tailor, soldier, sailor, pharmacist, tax accountant, bus driver, chef. If you mention the profession, Japan is likely experiencing a severe decline in the number of its practitioners – not just to the point of annoying, but to a place a little more existential.
So while the election of Sanae Takaishi as its new leader and the country’s first (and we might reasonably assume) female prime minister has been decided by the ruling LDP, it’s hard not to see some cruelty in the selection.
Her path to power was defined by inflation, the profound discomfort it causes the nation, and her predecessor’s failure to address it. In order to survive, Takaishi must somehow create public comfort with rising prices while inheriting an economy grappling with the “shortcut” of everything.
After seventy years of almost continuous power, the LDP lacks new ideas, and the country is paying the price for many old ideas that have not worked. But even more intractable are decades of adverse demographics, the simultaneous maturation of related crises, and a growing contraction in the labor force.
These facts make anyone who takes charge at this point likely to fail — on multiple fronts, and in ways that their predecessors did not survive largely because none of them reached their peak as they do now.
Insufficient labor force, aging workforce, limited ability to adapt to emerging opportunities, Service contraction And continuous contraction Customer satisfaction: Japan’s labor shortages are so acute and immediate to them that it makes the suggestion that artificial intelligence, robots, or some other technology will quickly step in to save the day seem foolish.
Take carpenters for example – essential in a country where a great deal of construction uses wood. Their numbers have more than halved since 2020, while more than 43% of those still working are over the age of 65. Many projects, large and small, are delayed. A shortage of bus drivers has led operators in Tokyo to cut more than 200 services. The army cannot approach recruitment targets. The Foreign Ministry revealed earlier this year that it could not employ enough Japanese chefs at its embassies. In some parts of the countryside, some goods are delivered to homes by motorcyclists in their mid-80s. There are real concerns across the industry that companies will face problems because Japan no longer has enough tax accountants.
The list goes on. The effect of all this shortening is that after decades of building up expectations of world-class service, everything seems a little worse, a little slower, a little less personal, a little less polite, a little more chaotic. Of course, Japan can absorb all of this. But its effect is to exacerbate the pain caused by rising prices at levels above average salaries. New populist parties have exploited voter anger, but it is no less true.
Takaichi doesn’t have much of a choice, because mentorship is now part of Japan’s demographic. Her pledge, minutes after winning the leadership race last Saturday, to abandon work-life balance and toil like a horse, may work to her advantage. It is not national policy. It is inevitable that some industries will find non-human solutions to many of their labor shortage problems, leaving technology to do the toil.
But Takaishi realizes that, for many years to come, large-scale immigration will represent Japan’s best hope. Here, perhaps unexpectedly, her nationalism and extreme conservatism put her at an advantage in two important ways.
The first is that Takaishi has spent three decades in politics, which makes it very difficult to attack her from the right, even if she leaves the doors to immigration relatively wide open. Her skepticism about immigration is a matter of record, and her predictable fear of the erosion of Japanese culture is real: if the turnstiles open in the face of abridgement, she can present this as a reluctant realism.
The second advantage is that Takaishi, unlike her predecessors in the Prime Minister’s Office, has shown a willingness to discuss immigration openly, treating the issue as a necessary public debate.
This is shrewd. Where public anger has been raised, it has not been directed at the immigrants themselves, but at the lack of serious discussion about what continuing mass immigration means for Japanese culture, public finances, and national sense of self.
Takaishi has given herself the tools to lead and survive this debate. The acronym provides a strong incentive to do it now, rather than later.
https://images.ft.com/v3/image/raw/https%3A%2F%2Fd1e00ek4ebabms.cloudfront.net%2Fproduction%2F00686cd9-b9b0-4ad6-8258-9bbbc9b97e44.jpg?source=next-article&fit=scale-down&quality=highest&width=700&dpr=1
Source link