Unemployment Cools Welcome for Reforms

By Suvendrini Kakuchi, IPS, 28 September 1999

TOKYO, Sep 28 (IPS)—Japan's business and banking sectors are in the midst of implementing much needed reforms, but the public's tolerance for the changes is being undercut by soaring unemployment figures.

Official statistics show that Japan's unemployment rate has reached a record 4.9 percent as of August, with 3.42 million people out of jobs in this country of 127 million people.

Analysts say that while the rest of the world applauds Japan's ongoing economic reforms, more and more Japanese are resorting to suicide, family violence, or battling other stress-related experiences as personnel budgets are slashed drastically.

As a result, the latest telephone poll conducted by the ‘Asahi Shimbun’ newspaper across Japan show that only 34 percent of the respondents said they were supportive of the banking and business changes.

The figure is significantly lower than in a similar survey taken in April when 42 percent said Japan should press ahead with economic reform, even if it means higher unemployment.

The latest Asahi survey was done on Aug 20 and 21, with 2,000 people participating. Aside from showing increasing intolerance toward the reforms, about 51 percent of the respondents also said they opposed sacrificing jobs for restructuring.

In addition, some 62 percent held the view that companies should give priority to maintaining employment rather than seeking profit.

Although rising joblessness is never welcome in any country, Japan is especially sensitive about the issue because of its practice of lifetime employment in return for unquestioning worker loyalty.

For a worker in this country to lose a job can thus be a most unbearable burden for the employee and the family.

Just last week, a jobless young man knifed two people to death and injured another six in busy Tokyo because, he told police, he was angry at society after he was fired.

Many Japanese fear repeats of such incidents as job opportunities decrease and stress levels rise. Even the mere thought of being laid off has put many salarymen in a state of constant tension.

Says 46-year-old Junko Hata, who runs her own apparel shop in downtown Tokyo: Japanese society was considered only till recently, to be safe, clean, and just. Things are changing for the worse.

Labour experts, meanwhile, worry about what will happen to people who had devoted more than half their lives to one company and then suddenly find themselves jobless.

According to official figures, the unemployment rate for people over 45 years is more than 10 percent, much higher than the national rate. The worst hit are middle-managers, mostly men who have already devoted around 30 years to the company.

Hiromichi Yamazaki, who works for the Managers Union, a service for middle-managers who have lost their jobs, says men who seek his help have especially suffered a cruel fate.

In Japan when you are thrown out of your company, life is worthless because there is nowhere you can go, he explains. The average Japanese company employee has not been trained to possess unique skills that allow him to jump from job to job, and the changes these men face now are truly frightening.

Yamazaki also points out that unlike in other countries, Japanese workers belong to unions under the control of each company, and are thus at a disadvantage in finding new jobs.

Once out of the company, the workers are out of their union as well, he says. Workers have been brought up to identify themselves according to their companies and not their individual skills.

Yamazaki says economic reform in Japan must be aimed at changing this situation as well. In reality most Japanese are not against reform, he says. What they are saying is that reform must not only mean only laying off workers but also be aimed at helping to develop ways to make people's lives better.

Labour activists have also argued that laying off workers does not help the economy, since people cut down on spending once they lose their jobs or live with uncertainty. This situation, in turn, has a downward effect on the economy.

This has not been totally lost on the government. In a bid to ease the rising unemployment statistics, Tokyo has promised to regenerate 600,000 jobs, of which half would be in the private sector. The rest would cover direct rehiring of jobless people by the central or local governments.

Prime Minister Keizo Obuchi has also reported funds for training of workers for new jobs, low-interest loans for small and medium- sized companies badly hit by the recession, and more job consulting offices as well as seminars for the development of new venture businesses.

But Yamazaki says that men seeking new jobs face are racing against time, since their unemployment benefits usually cover only three months, with the luckier ones getting a year's worth at the most.

He says many of the older workers have a hard time finding new jobs during that period. The Union, with more than 200 members, reports a success rate of only one in six.

One of those who have ironically been kept busy because of growing unemployment is Kenji Tokuzumi, a member of the Labour Lawyers Association of Japan.

He now has hundreds of people consulting him on how best to deal with companies intending to lay off workers. Tokuzumi has published a book offering tips on how employees can force companies to give them a good severance package.

Tokuzumi says, though, The best way to survive this troubling period is to teach the Japanese that they only have themselves to rely on.

The company is no more a place they can go for help. They must learn how to develop their own skills and be ready to take advantage of new opportunities. Reform toward this end is not a bad thing for Japan, he explained.