Editorial: Japan's new gender pay gap rules a chance to eradicate inequality

It is unfair that men and women have significantly different incomes while working at the same workplace -- and there is an urgent need to eradicate the gender pay gap.

Companies in Japan will be required to disclose the wage gap between men and women under the "women's version" of the government's Basic Policy for Economic and Fiscal Management and Reform, and statistics are expected to be disclosed online and elsewhere. Listed companies and other firms are also obliged to release data in their annual securities reports.

Once the actual situation is unveiled, the information will serve as a valuable indicator for job seekers when looking for employment. It will also be important for investors when it comes to deciding where to place their funds.

The disclosure policy, which has already been introduced in some European countries, is hoped to encourage firms to change their mindset and make amendments. About 18,000 firms with more than 300 employees will be subject to the new policy. It should be applied to more companies in the future.

The gender pay gap in Japan remains large compared to the rest of the world. According to a survey by the Organization for Economic Cooperation and Development (OECD), women's wages in Japan are only 77.5% of men's, which places Japan in the third-lowest spot among 43 countries and regions.

In Japan, the older the workers are, the larger the pay gap between women and men tends to be. The average monthly salary of full-time male employees in their late 50s exceeds that of their female counterparts by at least 100,000 yen (around $750).

One reason for the gender wage gap is that women's average years of service are shorter than those of men, as many quit their jobs due to childbirth and child care. As women have fewer chances to build their careers, fewer women are in managerial positions. Deep-rooted seniority-based employment practices should be changed to encourage the promotion of female workers.

More than half of female workers in Japan are non-regular employees. The huge difference in treatment between regular and non-regular workers must be improved, as this also results in a wage gap. There is an urgent need to raise the pay for occupations with a high proportion of women, such as child care, nursing care, elderly care and the restaurant industry.

It is also essential for companies to prepare a working environment enabling both male and female employees to work in various ways. Firms should cut back on long working hours and make further use of teleworking, which has spread in the wake of the coronavirus crisis.

It is also important to encourage male workers to take paternity leave. Only 12.65% of men took parental leave in fiscal 2020. Japan must leave behind outdated gender roles such as the belief that "men should focus on their careers and women should protect the household," and work steadily toward a society where there are no gender disadvantages.