Ageing and Robots: a view from inside Japan’s nursing homes

The world’s speedy and very successful vaccine response to COVID-19 in protecting the world’s elderly has underlined the importance of technology in dealing with humanity’s lengthening life expectancy.

Global life expectancy rose from 47 years at birth to 72.3 between 1950 and 2015, according to the UN. After an initial population explosion, societies have seen a marked increase in the average age and ultimately a fall in their populations. Japan presents the most dramatic example. It has an ageing society, stagnant demand and a shrinking labour force with limited immigration – so has opted to adopt new technology as a solution.

The use of robotics to supplement human labour shows even in care for the elderly in Japan, given an expected shortfall of 380,000 workers for Japan’s care homes by 2025. The government has subsidised the use of kaigo or nursing care robots in those homes. A recent survey of 860 showed that 26% of them were already using at least one type of robot, especially in larger homes, which can spread the capital costs more effectively. The adoption of robots increased overall staff numbers and reduced the wage bill as permanent (human) staff adopted part-time working, as well as reducing staff turnover as the robots took on the harder physical work. So robots have helped to enhance economic productivity and also brought a wider social good in lives residents and staff in Japan’s care homes.

A number of our investments have benefited from increased use of automation, especially industrial robots, and the consequent increased demand for computer chips or the equipment to make them. The Baillie Gifford Japanese Income Growth fund has been invested in Japan’s industrial robot manufacturer Fanuc, while the Fidelity Global Technology fund, which also performed well in 2020, has been invested in the chip equipment manufacturer ASML and the chip designer TSMC, both indirect beneficiaries of the increasing levels of automation even in the most empathetic of environments.


Andrew Gibbs, Investment Director