20 BARRON’S September 9, 2019
also requires companies to rehire those who still
want to work after 60, though it can be at lower
wages and responsibility levels.
But money is not the primary reason many
Japanese work well past 65. Social engagement
and a sense of ikigai —a view that one’s life is
still worth living—rank high among the motiva-
tions to remain on the job, says Takaoh Miya-
gawa, an aging and retirement expert at life
insurer Aegon Sony Life in Tokyo.
Consider Kamikatsu, a rural mountain village
with a rapidly aging population. The residents
revitalized its economy by creating a cottage
industry—picking the colorful leaves that grow
around town and selling them as garnish for
Japanese cuisine and decorations. Kato Manu-
facturing hires retirees to work on the week-
ends and holidays to keep factories running
continuously. Convenience stores and fast-food
chains have proactively hired the elderly, and
small businesses that have struggled to find
talent amid a national labor shortage also have
tapped retirees.
But Corporate Japan isn’t fully on board.
Nearly 70% of older people want to work beyond
the age of 65, but only 20% are actually em-
ployed, according to the AARP, the U.S. organi-
zation that focuses on issues facing retirees. The
Japanese government is trying to change that,
making expanding employment opportunities for
older adults a key component of its national
strategy to revitalize the economy. Its Silver
Human Resource Centers offer short-term job
opportunities in the community. They tend to be
low-wage positions, but the program still repre-
sents the kind of strategy that the U.S. could
emulate to help experienced workers remain pro-
ductive and engaged, says Ramsey Alwin, direc-
tor of AARP’s financial resilience thought leader-
ship. Another way for Japan—and the U.S.—to
employ older individuals is by offering more flex-
ibility, opportunities to refresh skills, and lifelong
learning, which would also help companies woo
coveted younger talent, Alwin adds.
Takeaway:It’s an old, but true, bit of advice:
When people work longer, they can continue to
save, and their savings don’t have to stretch as
far. But what’s possibly more important is the
notion of ikigai : When older adults stay active
and engaged longer, it lowers health-care costs.
AUSTRALIA
Employers must contribute 9.5% of
their employees’ income to Australia’s
version of a 401(k), called the Super.
There’s also a means-tested Age
Pension to ensure all retirees have a
minimum income.
BRAZIL
Brazil has been very generous to its
retirees, to the point its pension system
is now unsustainable. The nation is in
the midst of change, implementing its
first retirement age and increasing
mandatory contributions.
CHINA
The one-child policy from the 1980s has
since been replaced by a two-child policy,
but neither is enough to support a
pay-as-you-go pension.
SWEDEN
As part of sweeping pension overhaul
in the 1990s, Sweden privatized a small
part of its public pension system. Next
up: increasing the age at which retirees
can withdraw the money.
UNITED KINGDOM
In 2012, the U.K. began requiring
companies to auto-enroll employees
in a defined contribution retirement
plan, improving participation across
the board.
JAPAN
Japan has one of the highest
old-age dependency ratios—there
are far too few young workers to
pay into the government pension
that goes to elderly retirees. The
Lost Decade still has a deleterious
effect on personal savings.
Social Security Around the World
Most developed nations have a program to keep the elderly from becoming impoverished. Some plans are more successful than others.
By Alessandra Malito
UNITED STATES
Retirees really rely on Social Security
benefits: It’s the primary source of
income for 61%, and 90% of income for
a third of the people collecting it.
Source: MarketWatch- Silent Square
Dancing
There’s no do-si-
doing, but throngs of
older Chinese have
taken to dancing in
squares, creating
such a ruckus that
other residents have
complained. The
result? Silent
square-dancing,
with the dancers
wearing headphones
so they can still
move in sync.