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The Journal of the Trachtenberg School of Public Policy and Public Administration at The George Washington University

Abstract

The current labor shortage in China echoes a historical trend from the 1980s, first observed in Japan. A decline in fertility rates after the 1970s led to a gradual reduction in the available working population in Japan, resulting in a decrease in the overall labor force from 2000 onwards. The Japanese labor shortage has returned as Japanese workers face high workplace pressures and employers opt to maximize productivity with existing staff rather than recruiting or increasing wages. This approach has indirectly intensified pressure on employees, leading to self-isolation and widespread workplace discrimination against women. Such conditions have hindered the expansion of the labor supply. The shared socioeconomic backdrop of labor shortages extends to other East Asian communities, where an unwelcoming workplace atmosphere has discouraged the younger generation from participating in the labor force. Many have chosen to withdraw voluntarily, maintaining a basic standard of living despite lacking sources of income. This trend, compounded by a reluctance to enter marriages and the financial challenges of raising children, further contributes to declining fertility rates in the region's future.

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