Japan Turns to AI to Address Labor Shortages Amid Aging Population

Japan is increasingly turning to artificial intelligence to address labor shortages caused by the country's shrinking and aging population. AI applications are being developed and deployed across various sectors, including manufacturing, farming, English language teaching, and government administration, with the aim of increasing efficiency and productivity.

The Japanese government is actively supporting the development of AI technologies by offering financial assistance to technology companies. Five companies, including telecommunications giant KDDI and internet service providers GMO Internet Group, Sakura Internet, Rutile, and Hirhreso, will receive a total of 72.5 billion yen (around $470 million) in subsidies. These funds are designed to provide the computing power necessary for the operation of cloud services and AI technologies.

In addition to government support, private sector collaborations are also driving AI adoption in Japan. Fujitsu Limited and Oracle have joined forces to provide sovereign cloud and artificial intelligence solutions tailored to meet the digital sovereignty requirements of Japanese businesses and the public sector. This collaboration aims to empower organizations with hyperscale functionality and digital sovereignty while ensuring operational governance by Fujitsu.

The use of AI is not limited to the private sector. Researchers in Japan have developed an artificial intelligence tool that can predict potential employee departures by analyzing data such as attendance records and personal demographics. The tool aims to enable employers to proactively offer support to employees likely to face difficulties, potentially dissuading them from quitting. This application of AI in employee retention is particularly relevant given the high turnover rate among new hires in Japanese companies, where approximately 10% leave within the first year and 30% depart within three years.

Why this matters: Japan's embrace of AI technologies to address labor shortages and improve productivity has far-reaching implications for the country's economy and society. As one of the world's most rapidly aging nations, Japan's successful integration of AI across various sectors could serve as a model for other countries facing similar demographic challenges.

While the adoption of AI technologies offers potential benefits, it also raises important considerations. Educators and policymakers are cautioned to carefully evaluate inquiries about artificial intelligence to ensure they address real educational needs, have evidence of effectiveness, and are developed with input from educators and students. Additionally, the use of AI prediction tools for employee retention raises questions about data privacy, ethical use of predictive data, and the risk of self-fulfilling prophecies.

Japanese AI Advancement: As Japan continues to invest in AI and cloud computing infrastructure, with major players like Oracle committing over $8 billion over the next decade to broaden artificial intelligence, the country is positioning itself as a leader in the development and application of AI technologies. The University of Tokyo, a leading institution in Japan, is also exploring the use of generative AI tools like ChatGPT in education, recognizing both the potential benefits and the need for students to understand the limitations of such tools.

Key Takeaways

• Japan is using AI to address labor shortages due to aging population.
• Japanese govt provides $470M in subsidies to boost domestic AI development.
• Fujitsu and Oracle partner to deliver sovereign cloud and AI solutions for Japan.
• AI tool predicts employee departures to help employers retain talent.
• Japan positions itself as a leader in AI development and application.