During the two so-called ‘lost decades’ since the early 1990s, the standard of living of the average Japanese household has been maintained, and on some counts, has even increased somewhat.
Japan performs favorably on several measures of well-being, and ranks close to the average or higher in several topics addressed by the Better Life Index, published by the Organization for Economic Cooperation and Development (OECD).
The Index has been developed by the OECD’s Better Life Initiative, over the past 10 years, and attempts to move beyond GDP by measuring well-being in a multi-dimensional manner. This is achieved by exploring 11 areas that are essential to well-being in terms of material living conditions (housing, income, jobs) and quality of life (community, education, environment, governance, health, life satisfaction, safety and work-life balance).
The results provide a good overview of well-being patterns in the OECD’s 34 member countries as well as key partners Brazil and Russia, and will eventually include other key OECD partner countries (China, India, Indonesia and South Africa), representing the world’s major economies. The data mostly come from official sources such as the OECD or National Accounts, United Nations Statistics and National Statistics Offices.
So how does Japan stack up?
While “money” is not the only indicator of well-being, having it brings higher living standards as well as improved access to quality education, healthcare and housing.
“Household net-adjusted disposable income” is the amount of money that a household earns each year after tax, and as such, represents the money available to a household for spending on goods or services. In Japan, the average household net-adjusted disposable income is 23,458 USD a year, higher than the OECD average of 22,387 USD. For the sake of comparison, the average household net-adjusted disposable income for the US is 37,708 USD, for South Korea 16,570 USD, and for Switzerland 27,756 USD.
“Household financial wealth” is the total value of a household’s financial worth. In Japan, average household wealth is estimated at 71,717 USD, much higher than the OECD average of 36,238 USD. Again, for the sake of comparison, the average household financial wealth for the US is 102,075 USD, for South Korea 23,715 USD, and for Switzerland 95,407 USD.
Even though there has been a general improvement in living standards across OECD countries over the past fifteen years, we all know that not all people have benefited. In Japan, the income of the top 20% of the population is 46,436 USD per year, while the bottom 20% lives on 7,764 USD per year.
Regarding employment, 70% of those aged 15 to 64 in Japan have a paid job, higher than the OECD employment average of 66%. Approximately 80% of men are gainfully employed compared with 60% of women, indicating that women encounter difficulties in balancing work and family life.
Regarding education, in Japan the average student scored 529 in reading literacy, math and science in the OECD’s Programme for International Student Assessment (PISA). This score is higher than the OECD average of 497, making Japan one of the strongest OECD countries in students’ skills.
Regarding health, Japan stands out — with life expectancy at birth in Japan almost 83 years (three years higher than the OECD average of 80 years). Life expectancy for women is 86 years, compared with 80 for men.
On the other hand, Japanese are apparently somewhat less satisfied with their lives than the OECD average, with 70% of people saying they have more positive experiences in an average day (feelings of rest, pride in accomplishment, enjoyment, etc) than they do negative ones (pain, worry,
sadness, boredom, etc). This figure is slightly lower than the OECD
average of 72%.
“Your Better Life Index” is an interactive tool that allows anyone to see (as well as contribute to the view of) how countries perform according to the importance given to each of the 11 topics (i.e., community, education, worklife balance, etc.) that contribute to well-being.
Debbie Howard is Chairman of CarterJMRN KK, and President Emeritus of the American Chamber of Commerce in Japan. She is also a Visiting Professor of marketing at Sophia University.
By: Debbie Howard (Originally Published in Nikkei Review, 1st October 2012)
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