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Japan Finds Innovative Solutions to Counter Its Aging Headwind

Japan Finds Innovative Solutions to Counter Its Aging Headwind
To address the aging crisis and labor shortage across various industrial sectors, including construction, logistics, and agriculture, Japan is increasingly relying on technology. (Credit: AdobeStock)

With one of the highest life expectancies in the world, Japan has rapidly become a super-aging society. The country now boasts a world-record number of centenarians, a trend with significant long-term implications for its workforce. To address the aging crisis and labor shortage, Japan is relying on technology. We focused on 4 industrial sectors, including construction, logistics, agriculture and semiconductors,

Aging Crisis

The 65-or-older age group already accounts for over one-quarter of Japan’s population. This is expected to rise to one-third by the end of the next decade. It could even approach 40% by 2060, according to Japanese government sources. Alongside this, Japanese society is also shrinking. The current population of 126 million will drop below 100 million by 2056, and reach 87 million by 2070. 

These demographic trends present Japan with a serious socio-economic headache. Besides, Japan has a highly restrictive immigration policy. Foreign workers are brought in on short-term programs and then have to return home after three to five years.

Home to the world’s third-largest economy, the country must find ways to bolster its aging workforce. But it must also fortify national security, and attend to its ever-growing number of elderly people.

According to Will Jasprizza, Managing Director, Japan for leading Asia-focused international business development consultancy Intralink,

“From a general reduction in the workforce and massive pressure on the healthcare system to problems maintaining public services and handling a cyclical influx of international workers, Japan’s contracting and aging population poses the government and Japanese business an array of challenges.”


Automated Solutions

Even with efforts to hire more women, retirees, and foreign workers to boost the country’s labor pool, Japan’s demographic shift threatens to stall GDP growth. The key to sustaining such growth is not just finding workers. It is also transforming how they work through automation. Today, creative innovation based on the latest technologies is providing increasingly valuable solutions to a wide range of Japan’s demographic-related challenges. 

Japan is no stranger to coping with limited resources – including labor – and has historically been a leader in technological development. Automation and robotics, either to replace or enhance human labor, are familiar concepts in Japanese society. Japanese companies have indeed pioneered robotic technology for decades. 


Cutting-edge Construction 

Construction is one sector in Japan where automation is playing an increasingly important role. While construction projects across the country are booming, construction companies have long struggled to hire workers, despite attempts to attract more women and younger people. Only 10% of Japanese construction workers are aged under 30.

To address this issue, Japanese companies have invested billions bringing automated systems to market that can handle a wide range of tasks. These include preparing construction sites and moving materials to welding steel and installing ceilings.

In 2023, Tokyo-head Tokyu Construction and Takemura, another Japanese construction group, invested $1.5 million in US-based Toggle Robotics. (Credit: Toggle Robotics)

Japanese multinational Komatsu, for example, has developed a teleoperation system designed to remotely operate hydraulic excavators. It can then load materials onto autonomous dump trucks. Equipped with cameras, sensors, and wireless transmitters, the excavators, can be operated remotely by people who might not normally be engaged in construction work. This include elderly workers. 

In 2023, Tokyo-head Tokyu Construction and Takemura, another Japanese construction group, invested $1.5 million in US-based Toggle Robotics. According to Toggle, the company’s full stack robotics and automation solution for rebar fabrication and assembly multiplies labor productivity by a factor of three. It also increases overall production by a factor of five, compared to traditional assembly methods.

In 2020, Japanese contractor Obayashi began building an 84 metre-high, 334 metre-wide dam almost entirely with robots. The automated equipment they developed can stack concrete layers. Obayashi’s automated system is expected to be a game-changer in dam construction, as well as in other applications.


Keep on Trucking

Japan’s freight industry is also grappling with a shortage of labor. According to government sources, more than 45% of drivers in the country’s transportation industry are now over 50. This challenge will soon be exacerbated as a new overtime cap for truck drivers comes into effect at the beginning of April. According to Will Jasprizza,

“This is where automation in transportation and logistics will have to ramp up. Today, there is an increasing focus on mobile robots, which can help to place cargo in and out of trucks and warehouses, and reduce errors in order fulfilment by picking and packing. Japanese warehouse robots in use today range from compact autonomous mobile robots right through to large-scale automated storage and retrieval systems.”

Automaker Toyota has recently introduced a self-driving transport robot at its Motomachi plant in Toyota City. The robot ferries new vehicles across a 40,000 square-metre parking lot. Normally, this job is performed by drivers before loading cars onto carrier trucks. The company says it aims to have 10 of the robots operating in Motomachi by the end of 2024. 

Automated Agriculture

With more than 40% of Japanese farmers now aged over 75, Japan’s agricultural labor shortages have also become dire. While the Japanese government wants the country to become more self-sufficient in agricultural production, a dearth of human workers makes this a tough proposition. The rise of automated agricultural systems may offer a solution. 

Kyoto-based robot maker Tmsuk, for example, has manufactured a robotic duck called Raicho 1. It was deployed to some rice paddies in Japan’s Miyazaki prefecture last summer to keep them free from weeds. In its first practical test, the solar-powered robot was just one of a suite of drones and robots designed to sow, nurture, and harvest a standard rice crop without the use of humans.

Working with the city of Nobeoka, which is exploring ways to get agricultural land back into production, Tmsuk is robotizing agricultural tasks in a total of three paddies. So far the automated system has managed to secure 80% of the rice harvest in 5% of the time, when compared to harvesting by hand. 

Kyoto-based robot maker Tmsuk has manufactured a robotic duck called Raicho 1. (Credit: Tmsuk)

Something Old, Something New

Japan was a hub of chip manufacturing back in the 1980s and still retains an important position in certain semiconductor sectors. Keen to regain the country’s preeminent position in the global chip industry, the Japanese government is aiming to triple sales of domestically produced semiconductors to over $100 billion by 2030.

Underpinned by billions of dollars in subsidies, Tokyo-headquartered chip maker Rapidus aims to mass manufacture 2-nanometre logic chips, competing with industry-leading companies such as Taiwan’s TSMC, which has spent decades refining its processes. However, securing highly-skilled engineers in a country with a declining population is a major challenge. The government-backed company has managed to attract large numbers of experienced individuals from the heyday of Japan’s semiconductor industry, many of whom are over the age of 60. 

Towards Society 5.0

Of all the advanced countries in East and Southeast Asia, Japan shares the most similarities with Western nations exhibiting similar aging trends. Unlike the West though, Japan’s so-called “Society 5.0” plan means it isn’t relying on immigration to solve all its problems. On the Japanese government website, the plan calls for Japan to become the first country in the world to achieve economic growth with a shrinking population by becoming “a super-aging, super-smart society”. 

For Will Jasprizza,

“AI, drones, and autonomous robots will all play a major role in realising Japan’s Society 5.0 vision, but the exact mix of technologies, and the exact timing of their roll-out, is hard to predict. For example, autonomous vehicles will obviously change society in a major way, but are not expected to become mainstream in Japan until 2040. Nevertheless, if any country can achieve economic growth with a shrinking population, it’s Japan.”