Discussion Papers

The effect of training on the employment of older workers after compulsory retirement in Japan

DP Number DP2017-002
Language 日本語のみ
Date March, 2017
Author Kazuma Sato
JEL Classification codes J21, J26
Keywords Older Worker, Training, Matching Method
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Many industrialized countries are facing an ageing population. This threatens the sustainability of the social security system. To overcome this issue, policymakers must consider measures to encourage older people to work. Job-related training is considered to be effective for this purpose because it can prevent the deterioration of human capital. However, studies that examine the relationship between training and employment, especially in Asia where ageing is advancing rapidly, are still scarce. To fill this gap, this study examines the effect of training on the employment of older workers using the Longitudinal Survey of Middle-aged and Elderly Persons, the largest panel data available on the elderly in Japan. The key findings can be summarized as follows. First, the probability of re-employment rises significantly one year and two years after training. Second, training is effective in the case of re-employment as regular worker. This effect is notable because most re-employed workers are employed as non-regular workers. These results indicate that training is a useful measure for keeping older workers in work.