Japanese Vending Machines: The High Cost of Low-Skilled Labour

By Geoff Mason.

If you’ve ever been to Japan, you’ve probably noticed the bevy of vending machines. They’re everywhere. In fact, there are approximately 23 vending machines for every person in Japan. For a population of 127 million people, that’s, well…a lot of vending machines.

Source: Okinawa Travel Guide

Why, you may ask?

There’s more than one explanation for Japan’s vending machine proliferation. Some blame it on the price of real estate, which effectively bars many vendors from opening up brick-and-mortar operations. Others attribute it to the nation’s fascination with automation and robotics. More than likely, it’s a combination of many factors; however, there’s one thing that’s undoubtedly at play – expensive labour.

With an average age of 46, Japan has one of the oldest populations in the world. This has created a scarcity of low-skilled labour, thereby driving up wages for this group of workers. For many employers, it’s simply good business to substitute vending machines for high-priced, low-skilled labour.

There is a lesson in this for those of us on the other side of the Pacific.

Increasing wages for low-skilled jobs is a balancing act. While it’s important to ensure that labourers working in low-skilled positions are compensated fairly, significant wage increases – occurring through either market forces or legislation – may actually have negative effects on these workers. Indeed, this appears to already be happening in North America, as evidenced by McDonald’s recent roll-out of automated kiosks throughout the United States in response to the prospect of minimum wage hikes.

Japanese vending machines and McDonald’s kiosks are graphic reminders of the value of sustainable employment. As we see throughout the employment context, balance and mutual benefit are key to healthy, well-functioning workplaces.

(Main source: https://www.youtube.com/watch?v=9UJzVLXmBG4, video by US news outlet Vox.)


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