Work Trends in Japan

Looking at the trends in Japan, a country (and people) known for their work ethic will help give us insights as to where our workforce trends will lean to.

Japan has always been known for it work ethics. Death from too much work is so commonplace in Japan that there is a word for it -- karoshi. But in past years, the economic crisis that we feel has spread world wide.

For decades, the Japanese government has been trying, and largely failing, to set limits on work and on overtime. The problem of karoshi became prevalent enough to warrant its own word in the boom years of the late 1970s, as the number of Japanese men working more than 60 hours a week soared.

The consequences show up not only in claims for death and disability from overwork but in suicides attributed to "fatigue from work." Among 2,207 work-related suicides in 2007, the most common reason (672 suicides) was overwork, according to government figures released in June 2007.

Unpaid overtime is routine in factories and offices across Japan.

At Toyota, it had been built into factory life -- in the form of long, after-hours quality-control sessions that were supposedly voluntary -- and was considered a key to the company's success. Participation in the sessions, though, often figured in a worker's prospects for promotion and higher pay.

The labor ministry cites 80 hours overtime a month as the point at which a worker’s health and well-being become compromised. Anything above that and the chance of karoshi (death from overwork) becomes more probable.

Tokyo Shimbun found that of the 100 companies surveyed, 70 have agreements stipulating maximum overtime of more than 80 hours a month. The average is 92 hours. The most is for the printing company Dai-Nihon Insatsu, where employees can be asked to work up to 200 hours overtime a month.

In second place is Kansai Power Company, with 193 hours. The ministry, alarmed by this trend, revised the Labor Standards Law in April 2010 and implemented a new pay system for overtime work in a bid to check the rise in hours, but it didn’t work. Thirteen of the companies surveyed have increased the number of allowable overtime hours since then. Only Hino Motors has reduced them.

YOUNG PEOPLE AND WORK IN JAPAN: 

FREETERS AND NEET

Freeters (derived from the English word “free” and the German word for worker Arbeiter) is a term used to describe young part time workers. Comparable in many ways to Generation X slackers, they like to hang out and pursue interests like snowboarding and surfing, work only when they have to and reject traditional Japanese values such hard work and company loyalty.

There were 1.78 million freeters in 2009 according to the Internal Affairs and Communications Ministry. In 2006, 48 percent of those between 15 and 24 and 26 percent of those between 25 and 34 were described as freeters. The number of freeters between the ages of 19 and 30 rose from 1.83 million in 1990 to 4.17 million in 2001, more than a fifth of the population between the age of 15-34, excluding students and homemakers. In that same time period freeters between 25 and 34 tripled.

There are basically three types of freeters: 1) the dream-chasing type (13.7 percent), those who are pursuing dreams in things like pop music and manga drawing and don’t want to be burdened by a real job; 2) hiatus type (46.9 percent), those who have yet to decide what kind of career they want to pursue; and 3) no other choice type (39.4 percent), those who have tried but failed to get a regular job. One survey found that 72 percent of freeters would like to work for a company and have a regular job.

An official in the government Quality of life Bureau told the Los Angeles Times, “From the 1980s to the mid-1990s, most people chose to be freeters for the purpose of living their lives according to their own interests. But now many have no choice because of the difficult job market. As the economy worsened people who became freeters in the ‘90s found they could not escape and cannot acquire job skills. Being a freeter was once a stage, now it is possibly becoming a condition.”

NEET (not in education, employment or training) is another term used to describe young people not in regular jobs. A survey in 2005 counted 640,000 NEETs.

Freeter Jobs

Freeters earn around $7 to $10 an hour working at 7-11 convenience stores, budget restaurants and clothing shops and are employed as sales people, lifeguards and warehouse workers. Some sell jewelry or other stuff on the streets or pass out tissues with advertisements on them at subway stations. Their career ambitions include becoming a professional DJ, playing in a band, designing video games and working as a manga artist.

The average freeter earns only $14,000 a year. That doesn’t go far on one of the world’s most expensive countries. Typically they change jobs 4.3 times in a three year period. More than 50 percent do not contribute to the state pension system.

Many freeters want jobs that are flexible, give them free time, are not too demanding and allow them to wear the clothes and hairstyles they like. One study of freeters found that many lack career goals and "tend not to have any means of connecting their present situations to a future career."

Temporary Workers in Japan

In 2004, labor laws were amended to allow companies to give temporary workers less pay and fewer benefits. This came as a response to company’s saying the needed such changes to remain globally competitive.

The move was part a larger trend under Prime Minister Juichiro Koizumi to make Japan’s economy more flexible and responsive. Companies responded by making many new jobs temporary ones. Numerous temp agencies opened up. For several years there was plenty of work and no one complained. Some even preferred the temporary jobs.

Nonregular workers accounted for 38.7 percent of Japan’s total workforce and part-time workers made up 22.9 percent of all workers as of October 2010. Regular workers accounted for 61.3 percent of Japan’s total workforce

The number of temporary workers increased from around 100,000 in 1990 to 1 million in 2000. In early 2006—after the Koizumi government changed laws to allow companies to hire more temporary staff at lower wages—there were 5.95 million irregular workers, an increase of over 340,000 from the same period the previous year. In 2007, 40 percent of Japanese workers were employed in non regular jobs. In the 1990s they were still considered rarities. The number of temporary workers climbed 4.6 percent to 4 million in 2008.

The trend towards hiring temporary and part time workers at low pay has led to a widening income gap between these workers and permanent workers. Most of those affected are in their 20s and 30s, with the low pay making them unable to afford to get married or have children. The marriage rate of irregular workers between 20 and 34 is about half that of regular workers the same age.

Temporary Workers get paid much less than regular workers, get far fewer benefits and protections and are easy to lay off, and can be easily shed during bad economic times. They often work as hard and as long as full time workers but receive less money and are denied opportunities for advancement.

Some people prefer temporary workers to full time work so they could work the hours they wanted and change jobs when they pleased. Some people have even quit secure company job and gotten jobs through temporary agencies. Robert Feldman of Morgan Stanley Japan told the Los Angeles Times, “People took these jobs because they didn’t want to get trapped in Japan’s lifetime employment system...They wanted to have their jobs and go home rather than work late at night or do whatever their bosses demanded like full-time workers.”

Temporary agencies are forbidden from finding jobs for anyone who has graduated from university within the previous year. There are also rules that limit temporary workers to one year contracts. Even if a company and an employee like each other the employee has to look for a new job after the year is up.

Problems Faced by Temporary Workers in Japan

Temporary day workers have a tough go, They often changes jobs everyday and often don’t know what job to go to until they get a phone call in the morning. Often they don’t get any work at all. It is not unusual for a promised job to be canceled at the last minute.

Many young people find themselves unemployed or living in “entrenched poverty” because policies that protect middle-aged workers have left only poorly-paid, temporary jobs for them. The youth unemployment rate was 8.7 percent in 2005, almost double the 4.4 percent for the population as a whole.

The working poor include 4 million people between 15 and 34 who work part time or in temporary employment. The minimum wage for a month’s work in Tokyo is about $1,000—which many temporary workers don’t get—is lower than the $1,400 they get on welfare.

A kind of lost generation is evolving that is unable to gain full-time employment, can’t earn enough to get married, seem unlikely to produce children and trapped outside the pension and health care systems.

Internet an Manga cafes, charge ¥100 per hour and ¥880 for eight hours from midnight to 8:00am, are often filled with “working poor” who have nowhere else to sleep. Interviews have found that typical Internet café sleeper was a young man doing dispatch work but unable to earn enough to pay rent and young women who had divorced their husbands and worked part time. earning ¥90,000 a month.

In May 2009, a government panels urged the government to do more to help nonregular workers by providing them with unemployment insurance, employee pensions and public health insurance.

Effects of the Economic Crisis in 2008 on Temporary Workers

 Many of those who lost their jobs were nonregular, temporary or part time workers who were let go aid off after their contracts were finished or even before then. In some cases these workers lived in company dormitories and were told to leave when their jobs were terminated. Some ended up on the streets as they had little saving and unemployment insurance didn’t provide them with enough to get pay for new housing.

Some temporary workers were told to clear of their dormitory on the day they were notified they were laid off. One construction workers told the Los Angeles Times he slept in a subway and camped out ay Denny’s and finally pitched a tent in a Tokyo park after he was suddenly laid off.

A January 2009 survey counted 124,800 nonregular workers who lost their jobs, with only 10 percent of them able to find new jobs. Homeless shelters filled up with young people. Some women that lost their jobs lost their homes and were forces to sleep in all-night restaurants and Internet cafes.

A tent village made up of so-called “employment refugees” was set up in park in central Tokyo. Many of those there were temporary workers who lost housing with their jobs. A 49-year-old man in the villager told Kyodo, “I felt relief staying here as I had no food and housing, but I’m at a loss now and don’t know what to do next.” In Osaka, a 49-year-old temporary worker starved to death. The man was found dead in his apartment about a month after he died by apartment manner trying to collect overdue rent.

Labor lawyer Kenji Utsunomiya told the Los Angeles Times, “Suddenly workers were caught with no savings, nothing their pockets, because companies treated them as mere objects they could get rid of at their whim. People believed the government would take care of them. Now they know that’s not true.”

The number of temporary workers declined 24 percent in fiscal 2009-2010 to about 3.02 million . After the “Lehman shock” many companies terminated or did not renew temporary worker contracts.”

Day Laborers in Japan

“One call” day laborers refers to workers who let employment agencies know when they are available to work and wait for calls or e-mail messages on their cell phones that let them know if work is available. If they respond quickly enough the can get work for that day. The workers worker eight hours and are paid ¥6,000 to ¥7,000, after train fare in subtracted. The employment agencies that contact the workers are paid ¥12,500 yen by the company that provide the work.

The workers are often paid in cash on that day. Many are fretters or older workers who have lost their jobs. The service is a lifeline for workers who don’t have jobs but the wages are low and there is no guarantee of work on a given day. In a good month a worker may work most days and earn ¥130,000. In a bad month he may work only 10 days and earn ¥70,000. Such workers get no unemployment insurance and generally don’t earn enough to pay into the pension system.

In 2004 a ban on dispatch temporary workers doing manufacturing jobs was lifted. In 2008, a total of 5,631 dispatch workers were injured and 31 were killed in work related accidents. In 2007 there were 254 more injuries and five more deaths. The high number have been blamed on inexperienced workers placed in dangerous manufacturing jobs. 

Discouraged Young Workers in Japan 

Martin Fackler wrote in the New York Times, “Kenichi Horie was a promising auto engineer, exactly the sort of youthful talent Japan needs to maintain its edge over hungry Korean and Chinese rivals. As a worker in his early 30s at a major carmaker, Mr. Horie won praise for his design work on advanced biofuel systems.

But like many young Japanese, he was a so-called irregular worker, kept on a temporary staff contract with little of the job security and half the salary of the “regular” employees, most of them workers in their late 40s or older. After more than a decade of trying to gain regular status, Mr. Horie finally quit — not just the temporary jobs, but Japan altogether. He moved to Taiwan two years ago to study Chinese.” “Japanese companies are wasting the young generations to protect older workers,” said Mr. Horie, now 36. “In Japan, they closed the doors on me. In Taiwan, they tell me I have a perfect résumé.” [Source: Martin Fackler, New York Times, January 27, 2011]

“Japan has the worst generational inequality in the world,” said Manabu Shimasawa, a professor of social policy at Akita University, told the New York Times. He has written extensively on such inequalities. “Japan has lost its vitality because the older generations don’t step aside, allowing the young generations a chance to take new challenges and grow, he said.

“These disparities manifest themselves in many ways....There are corporations that hire all too many young people for low-paying, dead-end jobs — in effect, forcing them to shoulder the costs of preserving cushier jobs for older employees.

Others point to an underfinanced pension system so skewed in favor of older Japanese that many younger workers simply refuse to pay; a “silver democracy” that spends far more on the elderly than on education and child care — an issue that is familiar to Americans; and outdated hiring practices that have created a new “lost generation” of disenfranchised youth.

Young People Abandoning the System

“There is a mismatch between the old system and the young generations,” Yuki Honda, a professor of education at the University of Tokyo, told Bloomberg News. “Many young Japanese don’t want the same work-dominated lifestyles of their parents’ generation, but they have no choices.”

Tomohiro Ohsumi wrote in Bloomberg News: “The result is that young Japanese are fleeing the program in droves: half of workers below the age of 35 now fail to make their legally mandated payments, even though that means they must face the future with no pension at all. “In France, the young people take to the streets,” Mr. Takahashi said. “In Japan, they just don’t pay.”

“Or they drop out, as did many in Japan’s first “lost generation” a decade ago. One was Kyoko, who was afraid to give her last name for fear it would further damage her job prospects. “After interviewing at 10 companies, she said she suffered a minor nervous breakdown, and stopped. She said she realized that she did not want to become an overworked corporate warrior like her father.

By failing to get such a job before graduating, Kyoko was forced to join the ranks of the “freeters.”  Since graduating in 2004 she has held six jobs, none of them paying unemployment insurance, pension or a monthly salary of more than 150,000 yen, or about $1,800. “I realized that wasn’t who I wanted to be,” recalled Kyoko, now 29. “But why has being myself cost me so dearly?”

Sources: New York Times, Washington Post, Los Angeles Times, Daily Yomiuri, Times of London, National Geographic, The New Yorker, Time, Newsweek, Reuters, AP, and various books and other publications. 

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