The Japanese Ministry of Health, Labour and Welfare held a press conference on October 25, where Minister Shishiro Fukuoka announced the latest application figures for the “income barrier” subsidy policy. As of August 2024, approximately 270,000 people had applied for the subsidy, falling below 50% of the government’s initial target of 600,000 applicants.

This subsidy policy addresses a unique employment phenomenon in Japan. Under the current system, part-time workers who depend on their spouse’s income must start paying social insurance premiums once their annual income exceeds a certain threshold. To avoid these additional expenses, many employees choose to reduce their working hours, creating an “income barrier” in the job market.

To address this issue, the Japanese government launched a specific subsidy program in October 2023. The policy stipulates that companies will receive up to 500,000 yen per eligible employee if they increase working hours or wages for employees who begin paying social insurance premiums. This measure aims to encourage companies to maintain or increase employee working hours, breaking the labor market constraints caused by the “income barrier.”

Looking at the policy implementation, there were approximately 140,000 applicants by the end of January 2023. After more than six months of development, the number increased to 270,000 by the end of August. Although showing steady growth, this figure remains significantly below the target of 600,000 applicants, indicating that the policy’s coverage and impact still need improvement.

Regarding the current application status, Minister Fukuoka stated at the press conference: “The system’s utilization is progressing steadily, and we will continue our efforts to increase public awareness of this program.” This statement indicates that the Ministry of Health, Labour and Welfare will strengthen policy promotion in its future work to expand the policy’s reach.

Key Points:

• Japan’s income barrier subsidy applications reached 270,000, below the expected target of 600,000
• Government offers subsidies of up to 500,000 yen per employee
• Applications have grown steadily since the policy’s implementation in October 2023
• Applications increased from 140,000 to 270,000 between January and August 2023
• Ministry of Health, Labour and Welfare commits to strengthening policy promotion
• Policy aims to address the issue of part-time workers reducing hours to avoid social insurance payments