Executive summary
Japan must boost efforts to improve its adult learning system in order to keep pace with a rapidly evolving world of work. While the Japanese labour market has been characterised by relatively low unemployment rates, even in the midst of the COVID-19 pandemic, structural changes – such as technological progress and population ageing – are transforming the supply of and demand for skills. OECD estimates show that 15% of jobs in Japan are at high risk of being automated in the next 15 years and another 39% could face significant changes due to automation. The Japanese industrial structure and skills supply are also rapidly evolving, and the country is experiencing a significant change in the composition of its workforce, with a rise in women’s and elderly’s employment and non-regular labour. These changes have resulted in important skills imbalances in the Japanese labour market and heightened the need for upskilling and reskilling opportunities.
An increasing share of Japanese workers are not covered by traditional employment practices, requiring a reform of the current training system. Structural changes in the Japanese economy and society at large have eroded the importance of traditional employment practices, such as lifetime employment, seniority wage schemes, and regular graduate recruitment rounds. The adult learning system is considerably impacted by these changes in traditional employment practices. In fact, while under the lifetime employment system adult learning was primarily provided by firms, a whole new segment of the population will need learning opportunities outside the company.
There is a growing need for policy makers to expand the Japanese adult training market and provide more and better learning opportunities. Participation in training in Japan is low from an international perspective and training is mostly organised by employers. Relatively few adults engage in structured training activities at their own initiative. The Japanese authorities have made significant efforts to promote formal training, but with limited success. Public action should therefore prioritize off-the-job training and self-development for workers, particularly for the growing share of people in the workforce who are not eligible for company-led training. Also greater efforts are needed to ensure a high and more even quality of the training offered across the sector.
Access to adult learning opportunities in Japan is highly unequal, with participation in training particularly low for certain groups of adults. Non-regular workers (e.g. part-time, dispatched or contract workers) are around 50% less likely to benefit from employer-supported training. At the same time, older full time permanent workers are over 30% less likely to participate in formal or non-formal training than their younger colleagues, even when employed as regular workers, and workers in small and medium-sized enterprises (SMEs) are almost 50% less likely to participate in training than workers in larger firms. Targeted measures that take the specific barriers for these workers and their employers into account are needed to increase the inclusiveness of the Japanese adult learning system.
Training provision and its content need to be more extensively aligned with the needs of employers and the labour market. While the provision of public vocational training in Japan is built on a strong system of skills assessment and anticipation to ensure that the training provided is relevant to labour market needs, this type of information should be used more extensively and transparently in the design of adult learning policies. Moreover, to make the adult learning system better aligned with the needs of the labour market, it is important that adults at risk of skills obsolescence have access to targeted upskilling and reskilling opportunities. More efforts should be made to support Japanese workers who are likely to be impacted most strongly by structural changes by facilitating essential skills development and smoothing transitions to other tasks or jobs.
In an era of rapidly changing skill needs, Japanese adults need better access to career guidance to make informed choices about their career and relevant skills development opportunities. In Japan, the need for this type of services is growing as jobs are changing and workers are less likely than in the past to work for one single employer for their entire career. Relatively few employers provide regular and systematic career guidance to their workers, in spite of efforts by the Japanese Government to promote and support the provision of these services. Limited opportunities for career guidance outside of the firm are available for workers wanting to change jobs. Employers and workers struggle to identify skill gaps, which, in turn, limits career progression opportunities. Greater efforts are needed to bring available career guidance and skills assessment tools together to make them easier to use for employers and workers.
To foster the development of responsive and more widespread adult learning opportunities in Japan, the OECD recommends to:
Reduce barriers to training: for example by providing more generous subsidies for paid education and training leave for learning programmes that develop in-demand skills; supporting SMEs to hire replacement workers for employees who are on long-term education and training leave; and ensuring that government-provided training is organised in a modular way and allows for distance or flexible learning when appropriate.
Make adult learning more accessible for non-regular and older workers: for example by relaxing the conditions to access training grants and subsidies for education and training leave so that non-regular workers can also benefit from them; and making the Human Resource Support Grant more generous for employers who train older workers.
Expand the adult learning market: for example by: monitoring more systematically participation in adult learning programmes and identifying gap areas; providing greater financial support to formal education institutions for the provision of adult learning; and developing further quality assurance mechanisms in the non-formal, private training sector.
Target workers at risk of being impacted by structural changes: for example by providing basic digital skills development programmes to adults who lack the digital skills needed in the labour market.
Assess skill needs and align training with labour market needs: for example by facilitating the take-up of the Internal Occupational Skills Development Plan; and promoting comprehensive cooperation agreements between companies and higher education institutions to align training to the actual needs of the labour market.
Support internal career progression: for example by raising awareness about the possibility to make use of qualified external career guidance counsellors, especially among workers in SMEs; and promoting the use of job cards among employers while, at the same time, facilitating the integration of the job card approach into existing HR systems.
Support external career transitions and career guidance for jobseekers: for example by developing an interactive, easy-to-use online career guidance portal that brings together the information on occupations and training from different sources; and providing targeted information and guidance to jobseekers who were previously in non-regular employment.