Pension burden: More Japanese opt to retire late, extend employment period

Some economists expect the average pension-to-wage ratio to keep deteriorating and worries are growing that Japan's 'pay-as-you-go' pension scheme may be unsustainable

Yasuhiro Furuse could have retired two years ago, but he wasn’t entirely happy with his pension income and had to put any such thoughts to bed.

It was just as well for Furuse’s employer Orix Corp, a financial services group, which would have struggled to find a replacement, with Japan’s jobless rate at 26-year lows.

This win-win arrangement, increasingly common in Japan, highlights a structural and policy challenge facing the world’s third-biggest economy.

Prime Minister Shinzo Abe’s government is considering raising the retirement age to 70 or 75 from 65 now, to ease pension burdens as well as a labour crunch. But a