Facing a looming shortfall of 11 million workers by 2040, Japanese giants like MUFG Bank and Nippon Life are overhauling outdated job categories that kept women in low-paid, dead-end roles. The move signals a shift in how Japan values female talent amid a deepening demographic crisis.
When MUFG Bank and Nippon Life announced the elimination of administrative job categories almost exclusively staffed by women, it marked a rare, concrete step in Japan’s struggle to close its persistent gender gap at work. These roles, long associated with lower pay and limited prospects, have now been folded into broader career tracks, opening new pathways for female employees who were previously sidelined.
The urgency behind these reforms is clear. According to Recruit Works Institute, Japan is on course to face a shortfall of around 11 million workers by 2040, as the country’s population ages and birth rates remain low. With demand for labor projected to outstrip supply by a wide margin, companies are under mounting pressure to tap into the underutilized potential of women in the workforce.
Pay Gap Remains Stubborn
Despite these changes, the gender pay gap in Japan remains among the widest in the developed world. The latest Basic Survey on Wage Structure puts the average monthly salary at 373,400 yen for men and 285,900 yen for women—meaning women earn just 76.6% of what men do. While this figure has edged up from 74.8% in 2023 to 75.8% in 2024, and again to 76.6% in 2025, the gap is still significant. The OECD estimates Japan’s gender wage gap at 21.3%, the fourth highest among its member countries.
These averages reflect more than just unequal pay for equal work. Factors such as seniority, age, working hours, job category, and the scarcity of women in management all play a role. The concentration of women in lower-paid, non-career-track positions has been a major driver of the disparity.
Corporate Overhaul: MUFG and Nippon Life
MUFG Bank’s decision to abolish its BS category—once focused on teller and administrative duties—was a direct response to these structural inequalities. The bank acknowledged that this category was predominantly female and paid less than the general career track. As of April 2025, all employees now fall under a single professional category, theoretically giving women the same opportunities for advancement as their male colleagues.
Nippon Life followed suit, scrapping an administrative category that was almost entirely female. When these changes were announced, internal data showed that women at MUFG earned on average just 50% of men’s pay, while at Nippon Life the figure was even lower at 39%. These numbers reflect the overall workforce, shaped by the historic clustering of women in lower-level jobs, rather than direct pay discrimination for identical roles.
Demographic Pressures Drive Change
The scale of Japan’s labor crisis is stark. The workforce is expected to shrink from 65.87 million in 2022 to 57.68 million by 2040, while demand for workers will remain close to 68.68 million. Without significant economic growth or a dramatic shift in immigration policy, the gap will only widen, making it essential for companies to attract and retain female talent.
As the labor market tightens, the ability to offer competitive pay, real promotion prospects, and better work-life balance will determine whether more women stay in regular employment. Currently, the rate of regular employment among Japanese women peaks at 60.3% between ages 25 and 29, then drops sharply as many shift to temporary or part-time work after having children—a phenomenon the government calls the “L-curve.”
Flexible Work and Policy Experiments
In response, some public sector employers are experimenting with more flexible work arrangements. Since April 2025, Tokyo’s metropolitan government has allowed staff to compress their workweek and take three days off, as well as offering up to two hours of daily leave for employees with children. However, these measures currently apply only to government workers, not the broader private sector.
While Japan has not mandated immediate pay equality, the dismantling of outdated job categories by major employers signals a shift in corporate culture. The real test will be whether these changes translate into lasting improvements in pay, promotion, and retention for women—outcomes that will be critical as Japan confronts its demographic reckoning.
According to Talent24h, these reforms are being closely watched as a potential model for other companies facing similar pressures. If successful, they could mark a turning point in how Japan harnesses the skills and ambitions of its female workforce.
