Introduction
Amidst declining birth rates and an aging population, many developed countries, including Japan, face challenges related to a shrinking workforce and the sustainability of their social security systems. In this context, the acceptance of medium- to long-term foreign residents (such as migrant workers and immigrants) and their contributions to social security have become critical issues. (The Social Security Insolvency Crisis: How Deportation Makes It Worse 2025-07-18 American Immigration Council) These residents contribute not only as labor but also by paying taxes and social insurance premiums, which are vital sources of social security funding. This essay discusses the contributions, significance, and challenges of medium- to long-term residents to social security systems, citing successful cases in Japan and abroad.
1. Relationship between Medium- to Long-term Residents and Social Security Systems
Social security systems are designed to support elderly, disabled, and vulnerable populations, funded primarily through contributions and taxes paid by workers. As the working-age population shrinks, securing sufficient contributors who pay social insurance premiums is essential to sustain these systems.
Medium- to long-term foreign residents play a key role in supplementing labor shortages, particularly in sectors such as healthcare, construction, and services in Japan. By participating in social insurance programs and paying premiums, they help stabilize social security finances.
2. Contributions of Medium- to Long-term Residents to Social Security in Japan
2-1. Supplementing the Workforce
Since the introduction of the “Specified Skilled Worker” visa in 2019, Japan has expanded its acceptance of foreign workers even in relatively simple labor fields. As of 2023, there are approximately 2.3 million foreign workers in Japan, accounting for about 3.4% of the total workforce. Many are active in sectors facing labor shortages such as nursing care, construction, agriculture, and hospitality.
2-2. Social Insurance Premium Payments
These foreign residents are enrolled in health insurance, pension, and employment insurance programs, paying premiums that support Japan’s social security system. While some challenges remain regarding unpaid premiums, policies encouraging enrollment and compliance are advancing.
For example, foreign workers in nursing care pay into long-term care insurance and are expected to eventually gain entitlement to benefits, thereby strengthening their own social safety nets and contributing to the system’s sustainability.
2-3. Tax Revenue Contributions
Income and local taxes paid by foreign workers also constitute an important source of revenue for municipal governments, supporting public services and infrastructure. The settlement of medium- to long-term residents in local communities thus helps ensure stable tax revenues.
3. International Success Cases
3-1. Germany’s Immigration and Social Security Model
Germany has actively embraced immigration while mandating social security enrollment for immigrants. Turkish immigrants, in particular, have deeply integrated into the labor market and contributed significantly to pension and healthcare financing.
According to Germany’s Federal Statistical Office, immigrant workers are important contributors to pension funds and play a vital role in sustaining the system amidst an aging population. Integration programs including language education facilitate immigrants’ access to social security benefits.
3-2. Canada’s Comprehensive Immigration Policy
Canada utilizes a point-based immigration system to attract skilled workers who immediately join public healthcare and pension programs while paying taxes. Immigrants contribute to labor force growth, especially in provinces affected by aging populations.
The government’s multilingual support and job training programs help ensure immigrants can effectively access social security benefits, fostering mutual benefits for both immigrants and society.
3-3. The United States and Immigrant Contributions to Social Security
In the U.S., both legal and many undocumented immigrants contribute to social security through payroll taxes. Analyses by the Social Security Administration indicate that immigrants, particularly younger workers, are essential to the financial health of social security funds.
Many immigrants contribute without qualifying for benefits, which helps reduce system deficits, highlighting their positive financial impact.
4. Challenges and Prospects for Contributions of Medium- to Long-term Residents
4-1. Ensuring Fairness in Social Security
As foreign participation increases, issues of fairness arise. In Japan, while efforts are underway to secure pension benefits for foreign residents, challenges remain regarding the balance of contributions and benefits, especially as some return to their home countries without collecting benefits.
4-2. Creating Supportive Environments and Social Integration
Stable working conditions and social integration are prerequisites for participation in social security. Providing language education, cultural understanding, and legal protections are essential to enable foreign residents to fully engage with social security systems.
4-3. Addressing Long-term Demographic Changes
Beyond short-term labor needs, policies promoting permanent settlement are vital. Success stories abroad show immigrants establishing families and communities, helping stabilize population decline. Japan needs to adopt comprehensive measures integrating immigration and social security reforms to address demographic challenges.
5. Conclusion
Medium- to long-term foreign residents contribute significantly to social security systems by supplementing the labor force and paying social insurance premiums and taxes. Japan is making progress in system reforms and immigration acceptance, and these residents are indispensable for tackling aging and workforce decline.
Learning from successful international examples and addressing challenges of fairness and integration are key to building sustainable social security systems that benefit both residents and society as a whole.