Japan's poverty problem

Subject: Japan's poverty problem Thu Oct 21, 2010 3:04 am

Poverty in Japan is deepening. The welfare ministry announced last month that as of June, 1,907,176 people in 1,377,930 households were on welfare, receiving livelihood assistance (seikatsu hogo). This is the first time that the number of people on welfare has topped 1.9 million since fiscal 1955, when about 1.93 million people were receiving livelihood assistance every month. It is estimated that the number of welfare recipients will exceed 2 million by the end of 2010, close to the record set in fiscal 1952 when some 2.04 million people were on welfare.

In fiscal 1995, about 880,000 people were on welfare — the lowest figure on record. Since then, the number of welfare recipients has been rising. It topped 1.5 million in fiscal 2006. Since December 2008, due to the effect of the economic downturn triggered by Lehman Brothers Holdings Inc.'s collapse, every month more than 10,000 people have been joining the welfare rolls. The total number surpassed 1.8 million in December 2009. The figure in June 2010 is some 208,000 more than a year before.

Welfare rolls are swelling because of high unemployment, low wages and the increasing number of households that include low-income elderly people. A growing number of relatively young people who either can't find work or work in extremely low-paid jobs are being forced onto welfare. Often they have not joined the unemployment insurance scheme or their wages were so low that they cannot make ends meet with their unemployment insurance benefits.

The government should change the social insurance system so that even if the duration of time that people work is extremely short they can join and benefit from health and unemployment insurance schemes.

Currently, people have to pay premiums for at least 25 years to be eligible to receive pensions. This period should be shortened. Most importantly, the government must focus on job creation, particularly medical, nursing care and child-rearing services, where demand for workers is strong.