EDITORIAL: Jobs in nursing care

Prime Minister Naoto Kan is talking a lot about job creation in his Democratic Party of Japan leadership election campaign. What kind of vision does he offer to create jobs in areas like nursing care? We need to pay attention to his proposals as we watch this leadership race.

Kan has put job growth at the top of his economic policy platform for the election. He emphasizes that increasing employment in areas like the nursing care, medical and child-care services would also help enhance social security. In the same vein, Kan's opponent, former DPJ Secretary-General Ichiro Ozawa, has called social welfare a big "growth industry."

In developing the government's new growth strategy, Kan focused on health and nursing care. He also promised to create jobs in the nursing care sector during the campaign for the Upper House election in July. Pointing to the shortage of caregivers, Kan said government spending to raise the wages of caregivers would provide stable jobs to unemployed workers and stoke economic growth.

Creating jobs in these areas is expected to be a solution to the serious problem of the deteriorating employment situation for young people. The question is how exactly to achieve the goal.

Nursing care is an expanding industry. The welfare ministry has estimated that the market will grow to about 20 trillion yen ($238 billion) in 2025, up from the current 7.9 trillion yen. The number of workers involved in nursing care services is 1.4 million and growing by 63,000 a year.

Still, supply falls short of demand, as indicated by the fact that some 420,000 elderly citizens are still waiting to be admitted to special nursing-care homes. Only social welfare corporations and local governments are allowed to operate these facilities. The government should review such regulations to encourage new entries in the industry while safeguarding quality of care and safety.

Policy efforts to expand the market would increase job opportunities and stimulate investment, such as spending to develop nursing-care equipment. Good ideas for tackling this challenge would help create a positive economic cycle.

It is also crucial to improve caregivers' working conditions. Their monthly wages average about 210,000 yen, more than 100,000 yen below the overall industry average. As a result, many caregivers quit their jobs after a short period.

The previous coalition government of the Liberal Democratic Party and New Komeito spent more than 500 billion yen in combined supplementary budgets for fiscal 2008 and 2009 to improve the working conditions of employees at nursing-care and other facilities.

But that measure expires at the end of fiscal 2011.

To prevent care workers' wages from shrinking because of a funding shortfall, it is necessary to bolster the financial base of the nursing-care insurance system by reviewing tax financing, premium income and out-of-pocket payments by the people who receive the nursing care services.

This month, a welfare ministry panel tasked with a review of the nursing-care insurance program will start discussions on such issues as working conditions of caregivers, insurance premiums and tax financing.

We hope the panel will steer reform in the right direction through careful discussions on caregivers' wage levels to ensure high-quality services and equitable sharing of the financial burden.

One key issue concerns premiums paid by people aged 65 or older living on their pension benefits. Currently, such pensioners pay 4,160 yen per month.

But that amount is expected to exceed 5,000 yen under the scheduled revision in spring 2012. While many municipalities are claiming there is little room left for further increases, they should consider the issue from a broader perspective, taking into account the need to pay caregivers higher wages.

People involved in the debate should keep in mind the fact that overall tax reform, including a consumption tax hike, is inevitable sooner or later.

--The Asahi Shimbun, Sept. 7