Will More Day Care Help Boost Japan's Sluggish Economy?

Japan has made progress recently in getting more women to join the workforce. The latest numbers show a greater percentage of Japanese women work outside the home than American women. But for a rapidly aging and shrinking population, that progress may not be fast enough.

One of the biggest reasons Japanese women choose to stay home is the lack of child care options. As of the latest count, in April 2015, about 23,000 Japanese children were on waiting lists for day care. Unable to find other options, many parents give up the hunt.

Hato Poppo Nursery School in Tokyo's Setagaya ward takes children ranging in age from 3 months to kindergartners. It's one of Japan's highly coveted, subsidized day care centers for families of all income levels. Children are dropped off as early as 6 a.m. and stay as late as 8 at night because of their parents' 12-hour workdays.

"There's a huge demand for day care and kindergartens. The number of day cares are increasing, but slowly," says director Takayuki Yoshizawa.

At the Hato Poppo Nursery School in Tokyo's Setagaya ward, the waiting list is as long as 1,200.

Courtesy Hato Poppo Nursery School

Parents face long odds just to get their child into a center like this. Reika Hattori considers herself lucky that she found her preschooler a spot in a center.

"In total, I applied to maybe 20 to 30 to get into one," she says.

It meant a gauntlet of applications and lists — competition for slots so tough that it has its own name, hokatsu, an abbreviation for "actively searching for a day care." She says her fellow moms often wanted to keep working after having babies, but "some of them couldn't get back because of the nursery school, because they can't find any nursery school."

In fast-aging Japan, where 26 percent of the population is 65 or older, resolving the child care crisis is now at the center of economic policy. Recognizing that keeping young, educated women in the workforce is crucial to Japan's economy, Prime Minister Shinzo Abe has made "womenomics" central to his economic revival plan. His pledge is to cut child care waiting lists to zero.

"They're about halfway to their goal, but at least there's been some progress on that front," says Kathy Matsui, the chief Japan strategist at Goldman Sachs. She's a longtime advocate of gender diversity in Japan and is responsible for coining the term "womenomics" more than a decade ago.

The argument was simple but took a long time to take hold.

"If you could raise Japan's female labor participation rate to that of Japanese men," Matsui says, "then you could significantly lift the size of Japan's economy."

On the policy front, there's been movement in getting more women in the workforce. Abe's pledge to create 400,000 new day care slots by 2018 is being subsidized by the government, and Japanese parents are getting a "child allowance" as well, based on family income and number of children.

Matsui says women are still at a disadvantage because cultural attitudes are harder to change than policy.

"Even if you have the infrastructure and the support around you," she says, "there are questions from your family members about 'is it really appropriate for you to be raising a newborn or your infant child when you're not home full-time?' "

Japanese men do the lowest amount of household work in the developed world, a reflection that the East Asian nation still sees caretaking and household duties as women's domain.

For mom Reika Hattori, finding a day care slot was one win — but she says her husband sharing the load at home is the key to making her family work.

Chie Kobayashi contributed to this story from Tokyo.