Japan sees over 5.4 million workers aged 70+

Japan normalizes working past age 70

How much must a state pay for its population to stop calling "retirement" what is actually continuing to clock in? In Japan, the answer is uncomfortable: an average public pension of about €245 per month. With that figure on the table, more than 5.4 million employees aged 70 or older remain active, and 80% of those reaching legal retirement age admit they want to keep working. It’s not vocation. It’s arithmetic.

The data doesn’t come from seasonal headlines. The employment rate among people over 65 in Japan is 25.2%, far above the 18.6% in the United States, 10.9% in the UK, or 3.9% in France. 99.9% of Japanese companies have implemented measures to retain veterans beyond age 65, and nearly a third already guarantee employment until age 70 or older. The 2023 reform raised the mandatory age from 60 to 65. Companies went one step further.

Why do Japanese people work after 70?

The first answer is life expectancy: 87.14 years for women and 81.09 for men. Reaching 65 with reasonable health turns retirement into a long phase someone has to finance. And the public system doesn’t cover it. The maximum annual pension in Japan’s public system is 831,700 yen, about €5,100 per year, which combined with private funds leaves a monthly average of 40,000 yen. Two hundred forty-five euros. That won’t sustain you in Tokyo or a town in Hokkaido.

The second answer is demographic. There are more recipients than young contributors, and the budgetary balance of pensions suffers. The birth rate has been stagnant for decades. The result is a labor market that has decided not to let anyone go: less demanding day shifts, schedules adapted to physical limitations, and contracts rewarding longevity. “Compared to young people, who have high turnover rates, senior professionals who stay with us longer are the pillar of our company,” summarizes the president of a tech firm cited in the material.

The calculation debunking the golden retirement narrative

In the background is a debate beyond Japan: whether retirement is a right or a financial situation. A calculation circulating in the debate ecosystem puts numbers on the trap. Someone who emigrates and stops contributing in Spain saves about €1,800 per month in taxes, totaling €216,000 over ten years. But if they stay and contribute, the pension received between ages 65 and 85 could reach €552,000. The question is obvious: how does €216,000 become €552,000? The answer lies in the pay-as-you-go system, where active workers’ contributions fund passive retirees’ pensions. The full breakdown, item by item, shows a surprising difference.

It’s not exclusively a Spanish debate. In Chile, the individual capitalization system faces criticism for low pension amounts, but defenders note that Chilean contributions hover around 10%, while in Spain they exceed 30% of employer costs. Multiplying Chilean pensions by three would offer a fairer comparison. The argument repeats in every reform: comparing what is collected without looking at what is contributed.

Who wins and loses when delaying retirement

The profile of beneficiaries isn’t uniform. Those earning €200 more working than retired, with physically demanding jobs, want to retire ASAP. Those earning €2,000 more, sitting in offices with tenure and career paths, aren’t in a hurry. Seventy is the new sixty for some; for others, it’s a sentence. Sun exposure, damaged vertebrae, torn menisci, and poorly viewed sick leave don’t count in the official narrative.

The other front is future pensions. Today’s taxpayers funding current pensions will see their own benefits cut. This already peine with freezing most pensions and a 0.25% increase amid higher inflation. The suspicion that adjustments will hit those not yet retired isn’t theory: it’s the system’s mechanics.

The question looming over the entire debate

Is a model sustainable where public pensions are minimal and private savings become de facto mandatory? Pay-as-you-go advocates argue it guarantees dignified old age for all. Critics point out money never passes through the contributor’s hands and intergenerational solidarity has become forced transfer. Meanwhile, reality in Japan doesn’t wait for theory: every morning, millions over 70 get up to work. Not because they want to. Because the pension isn’t enough.