Who benefits from Japan’s panic over ageing?
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Last year, Japan’s population shrank by 630,000 people, or one Luxembourg. Between now and 2040, it is forecast to have declined by a further 16mn, or one Cambodia. The rivulet of young Japanese reaching the official age of adulthood is at a post-war low and the tide sweeping into the over-65 age bracket is at a record high.
There is no upbeat discussion to be had on Japan’s demographics. But neither is there a way to avoid discussing the subject, particularly the issue of how corporate Japan can hope to function as it has until now but with relentlessly fewer humans.
Developments happening behind the scenes in one part of the economy, however, do at least offer a new way of thinking about the problem.
A traditional response to Japan’s workforce shortage has been to take comfort in the idea that scene-shifting technology is either here or just around the corner. Buzzy investment narratives around artificial intelligence have given this a new edge of plausibility.
Projections of technology’s role as saviour range from realistic forecasts of greater automation of factories and other labour-intensive industries to more fanciful robo-scapes where automatons populate the service sector, cook, clean, wait on tables, patrol offices after hours and tend to the elderly as nurses.
While some genuinely believe that robots will assume more and more roles currently occupied by humans, others see the benefit of robots as handily postponing an immigration debate which makes the country’s body politic collectively wince. Both are strangely old-fashioned ways to approach the problem.
Takafumi Yano’s start-up may have found another way. In Japan, the business of outsourcing jobs overseas stands somewhat ambiguously behind these debates: though a great many of its companies have embraced the opportunities (especially by offshoring manufacturing), for many others the perceived risks around quality, reputation, customer relationships, language and oversight outweigh the benefits. The jobs have stayed at home.
One side-effect of this has been to stifle serious discussion around how much of the work carried out by Japan’s workforce could in fact be done by another country’s.
But technology is now giving that oxygen, says Yano, a 31-year-old from Kyoto who founded a company while completing a doctorate in brain signal imaging. His enterprise, Rutilea, is mulling plans for a listing in Tokyo and is in talks with some of Japan’s largest industrial names, including Toyota.
The idea behind Rutilea stems from a view that far too many Japanese workers — Yano estimates about 500,000 — are engaged in some aspect of quality checking and inspection. These jobs, which range from inspecting highly engineered components to ensuring that lunch boxes are laid out properly, tie up a sizeable chunk of a shrinking workforce. If released and redeployed, argues Yano, those 500,000 humans would be many times more productive than the best robots on the market.
To make this happen, Yano is offering to set up a system that combines AI — which at this stage, he says, is only partially effective as a quality inspector — supplemented with eye-checks by humans, outside Japan, using their mobile phones. Cameras positioned in factories and production lines provide enough detail, he says, for a very large proportion of such tasks. Gig workers around the world — Turkey and Indonesia, he says, stand out — networked together as a single but fluid workforce can perform the inspections from their homes at hours that suit them.
Is Japan ready for the cultural change that would accompany this shift? For decades, it has sought to make its attention to quality a unique selling point of its manufacturing industries, a key element of the monozukuri (thing-making) ethos that underpins so much of national pride.
As such, the idea of outsourcing this element of the manufacturing process goes some way beyond whether the technology is ready, the cost is attractive and the practical outcome the same as if it had been done at home. Indeed, for Yano, the issue of outsourcing quality control represents a particular Rubicon for corporate Japan to cross.
It’s why the progress of Rutilea and the deals that it strikes with Japanese corporations in the coming months and years are such an important index. The more seriously Japan takes the idea of using tech to redeploy its human workforce, the less time it will waste waiting for a robot army that may never come.
Leo Lewis is the FT’s Asia business editor
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