Japan’s biggest financial firms are abolishing decades-old practices that kept women off the corporate ladder.
Nippon Life Insurance Co., Japan’s largest insurer, and MUFG Bank Ltd., a unit of the nation’s biggest banking group, are among firms that in recent months scrapped a clerical job category that consisted almost exclusively of women, who were paid less than those on the career track.
Merging the two job types may increase opportunities for women to advance to more senior positions. Japan’s latest move to catch up with the West comes even as US companies start to reverse some of their diversity policies, under pressure from President Donald Trump’s administration.
The divided system was long used in other industries too, resulting in Japan having some of the biggest pay gaps between women and men in the world, but the financial sector is one of the worst offenders and has been slow to change. Work was often structured in the past so that women were expected to stay at their jobs for just a few years, marking time before marriage. That’s become rare recently, but the system has stayed in place.
Women in Japan earned 75% of men’s wages across all industries in 2023, compared with 62% for financial firms and insurers, according to data from a government-led panel on women in the workplace. That figure dropped to 50% for Mitsubishi UFJ and just 39% for Nippon Life in the fiscal year that started in April 2023.
A legal requirement to publish data on gender pay gaps introduced in 2022 has made the disparities more visible, according to Mioko Bo, an associate fellow at NLI Research Institute.
“HR departments now know they have to change — they are being scrutinized both by potential recruits and investors,” she said.
In Japan’s postwar high economic growth era, men were expected to work long hours while women stayed at home after spending a few years working. The financial sector in particular was a big employer of women to handle the huge amounts of paperwork the firms needed before automation took over.
Even after the law was revised in 1997 to forbid hiring practices that discriminated against female workers, almost all jobs in the lower-paying category still went to women. Now, jobs focused on paperwork and cash are rapidly disappearing.
Other firms in the financial sector including Dai-ichi Life Holdings Inc.,Sumitomo Mitsui Financial Group Inc. and Mizuho Financial Group Inc. have already merged the job categories. The nation’s biggest bank and insurer taking that step is a sign that the sector is finally getting more serious about reducing gender inequalities.
