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The 47th WORKSHOP
22 November 2008 (Sat), GRIPS Campus in Tokyo, 14:00-17:00

Subject:
"
Migrant Workers and Aging Population in Japan"

by
PhD. Junichi Goto
Professor of the Research Institute for Economics, Kobe University, Japan   

Summary
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According to the United Nations, Japan now ranks fourth among 153 countries in terms of the old population ratio. Along with the declining birth rate, it is anticipated that in the next 25 years Japan will face a serious labor shortage of as high as 17 million. One of the measures being suggested in order to relieve this problem is that Japan should be open to an increasing number of international migrations. In this monthly workshop of November, we are very glad to invite Professor Goto from the Research Institute for Economics, Kobe University. Professor Gotofs presentation focused on pointing out the impacts of migration on sending and receiving countries and proposing some alternatives to address the issue of working population decline in Japan.

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The first part of the presentation introduced a lot of data showing the rapid increase in number of migrant workers in Japan who were categorized into three groups including Nikkeijin, legal skilled and illegal (mostly unskilled) workers. Following in the second part, another series of graphs presented a quite comprehensive picture of Japanfs population in which its fertility rate hit 1.26 in 2005, while the ratio of elderly population was expected to reach 28% by 2030. gHow to cope with future labor shortage due to aging population?h was the main question of the next session.

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The first measure to this issue was immigration of which the economic and social impact on the host and sending countries was successively elaborated on. After briefly reviewed the traditional and alternative economic theories, Professor Goto presented his own findings on the economic effect of migration under the new framework in which three factors were included consisting of trade barrier, non-traded good and possible change in factor prices. Results showed that while the sub-effects might vary depending on each factor, the overall economic effect was that when the level of the admission of migrant workers was relatively small the negative etrade barrier effectf dominated, thus making the welfare level of the host country decline. However, after a certain point, as the number of migrant workers increased, the positive echeaper foreign labor effectf became dominant and the economic welfare started to rise. This meant that the less severe the trade barriers were, the more likely it was that the admission of a certain number of migrant workers could be welfare-improving. After presenting both the economic and social impact of migration on the host and sending country, the author proposed three alternative measures to immigration which were labor productivity increase, trade liberalization and domestic labor supply, especially female labor. Prof. Goto insisted that there was a need to have policies to provide better working environment for women and to change the old-fashioned social view toward gender role so that this important labor force could be effectively mobilized to mitigate the expected labor shortage in Japan.

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Right from the beginning of the presentation, there were questions from Ms. Nguyen Thuy Anh (Waseda University) and Mr. Vu Tuan Khai (Yokohama National University) concerning the interesting data showing the decline in the number of registered Korean people in Japan. Participants were also interested in the explicit and implicit motivations of the Japanese government in attracting more and more Nikkeijin into Japan most of whom are unskilled workers. Mr. Sakamoto from Nomura Research Institute asked question about the measure to mobilize the elderly workers which had not been mentioned in the presentation. In response, Prof. Goto explained that it was more effective to focus on the mobility of female workers because this labor force made up 50 percent of the whole population. Following up this issue, Ms. Nguyen Thi Kim Oanh from GRIPS suggested that there needed to have better child care mechanism to support working mothers, and in this regards, Japanese government should refer to the good experience of Vietnam. Mr. Vu Hoang Nam, also from GRIPS, made a comment that the measure to shift low-productivity industries to high-productivity ones seemed to be too optimistic given the high rigidity in the labor market. Regarding this issue, Prof. Goto agreed that in the short term this might be true, however in the long run of 25 to 30 years, he asserted that this movement is rather realistic. Mr. Dinh Quang Hop (Tokyo Institute of Technology) had questions and comments on the emotional arguments against immigration and legislation on the illegal migrants. He also shared some experience of the Australian government in dealing with this issue. Finally, Prof. Ohno raised his comment regarding Prof. Gotofs figure showing the relationship between migrant workers and the host countryfs welfare. Prof. Ohno suggested that the author take into consideration in his model the diminishing marginal returns. Prof. Goto explained in detail and thanked everyone for all the questions and comments and for their active participation in his presentation.

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After the presentation section, as usual, we had an hour meeting in which participants introduced themselves and their research interests. The discussion continued with interesting ideas and stories about Japanfs and Vietnamfs governmental policies toward working conditions for women and different views on gender role in the society. Finally, we announced forthcoming research activities of VDF Tokyo and welcomed anyone to take part in these events.

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Slides(PDF552KB)

 (By Nguyen Thuy Anh)

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