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Japan employment

This page is about the unemployment rate and the gradual loss of the job-for-life ethic, as two key measures of the employment situation.

Note: this page will only be updated irregularly.

Summary

24 Aug 2014.

In the short run the unemployment rate reflects the business cycle. Since the financial crisis the trend has been down.

In the long run, the unemployment rate also reflects the transition from most jobs being secure for life to the present situation, where about a third of jobs are temporary or part time.

Graph

24 Aug 2014. Data through Jun 2014.

Note: From March to August 2011, the Statistics Bureau excluded the Iwate, Miyagi, and Fukushima prefectures from the unemployment calculation. Starting with September, probably those who remain displaced are counted as outside the labor force, and hence not unemployed.

Sources

The two main surveys are:

  • Monthly Labor Force Survey of households, carried out by the Bureau of Statistics (release schedule). On the historical data page, the source for the above graph is first table in the first section, which combines a number of statistics.
  • Monthly Labor Survey of establishments, carried out by the Ministry of Labor.

In addition, for non-regular vs regular employment the less frequent Employment Status Survey, conducted by the Bureau of Statistics, is the main source (though no historical data are provided on-line).

See also

Clippings below were used in the construction of this page

Definition of unemployment in Japan

Mar 1984. US BLS, Monthly Labor Review.

http://www.bls.gov/opub/mlr/1984/03/art3full.pdf

“Japan's low unemployment: an in-depth analysis. CONSTANCE SORRENTINO”

“The unemployed in the monthly Japanese survey are defined as all persons 15 years of age or over who did not work at all in the reference week and who were seeking work or awaiting the results of previous employment applications.

The Japanese questionnaire lists the following answers to the question “Was this person engaged in work at all during the survey week?”

  1. Engaged mainly in work
  2. Engaged partly in work besides attending school
  3. Engaged partly in work besides home duties, etc.
  4. Had a job but did not work
  5. Had no job but seeking one
  6. Attending school
  7. Engaged in home duties
  8. Other

Persons checking response number 5–had no job but seeking one”-are classified as unemployed. This response is defined in the survey explanatory notes: “Refers to the person who had no job but was actually seeking work by answering advertisements in the newspaper, applying at the Public Employment Security Office, etc. Also refers to the person who is waiting for an answer to an application and is able to take up a job immediately after he finds one.” ”

The article concludes that if unemployment were calculated using US definitions, it would be 0.4 to 0.7 percentage points higher. The BLS publishes an adjusted series.

Second BLS analysis concludes Japan methodology comparable to US

Jun 1987. BLS.

http://www.bls.gov/opub/mlr/1987/06/rpt3full.pdf

“Japanese unemployment: BLS updates its analysis. CONSTANCE SORRENTINO”

“The special surveys of February 1984-86 were not available to Taira or BLS when the earlier articles were written. After reviewing the surveys, BLS believes they support the contention that the Japanese unemployment rate is only slightly changed when U.S. concepts are applied.”

Concepts and surveys for part-time and temporary

Oct 1995. BLS Monthly Labor Review.

http://www.bls.gov/opub/mlr/1995/10/art2exc.htm

“Part-time and temporary employment in Japan. Susan Houseman and Machiko Osawa”

“Most of the data used in this article are from the Employment Status Survey conducted by the Bureau of Statistics. This periodic, household survey provides detailed information about part-time, temporary, and other forms of nonregular employment. The survey has been conducted at 5-year intervals in recent years; the latest survey was in 1992.

In the Bureau of Statistics Employment Status Survey and the Ministry of Labor Survey on the Status of Part-Time Workers, a part-time worker is defined as an employee whose position is classified as part time by the employer; a part-time employee does not necessarily work fewer hour than a full-time employee. In 1990, 20.6 percent of workers classified a part time by their employer worked as many hour as did regular, full-time workers. The set of personnel practices that applied to these workers distinguishes them as part time. For example, in large- and medium-sized Japanese companies, regular full-time workers typically are given commitments of lifetime employment and the wages and promotions of these workers are determined to a large degree by seniority. Practices of lifetime employment and nenko (seniority-based) wages and promotions rarely apply to part-time workers.”

Japanese inequality

1 Dec 2007. Economist p20.

http://economist.com/opinion/displaystory.cfm?story_id=10214998

“Tuning the hybrid”

“a two-tier labour market. The share of “non-regular” workers—which includes temporary, part-time and contract workers—has risen from 19% in 1989 to 33% today. Non-regular workers generally earn less than half as much as “regular” workers do, and are denied the generous perks and social-insurance coverage that such insiders receive. … In a survey carried out in 1987, 75% of the population identified themselves as middle class. By last year the figure had fallen to 54%, and the number of people who identified themselves as below middle-class had risen from 20% to 37% over the same period.”

Employment status survey history

Undated, probably 2008. Bureau of Statistics overview page.

http://www.stat.go.jp/english/data/shugyou/2007/1.htm

“The 2007 Employment Status Survey Outline of the Survey”

“The Employment Status Survey has been conducted every three years since 1956 until 1982 and every five years since 1982, the 2007 Employment Status Survey being the fifteenth one.”

Japanese part-time workers out in the cold

10 Jul 2008. FTUSA p9.

“Poverty widens the crack in Japan's facade. Michiyo Nakamoto”

“Although unemployment in Japan, at about 4 per cent, is by no means high, the number of so-called “working poor”, who earn less than Y2m ($18,600, EUR11,800, pound(s)9,400) annually - a level considered to be close to, if not at, the poverty line - has risen at an alarming rate. In 1997, 5m workers fell in that category but by last year the number had doubled to 10m, according to a government survey. The rise in working poor stems largely from a sharp increase in non-regular workers as Japanese companies restructure their workforces to cut costs and remain globally competitive. Non-regular workers, including part-time workers, temporary workers and others, comprise more than a third of the total workforce, according to government statistics. In addition, there are at least 1.8m “freeters”, who take on whatever temporary jobs they can find and generally have no benefits. Thousands of freeters, in their 20s and 30s, sleep in internet cafes and are unable to find stable employment because they lack a permanent address.”

Non-regular workers about a third of total

5 Feb 2009. Economist.

http://www.economist.com/node/13059773

“Non-regular and not wanted”

“Hardest hit will be “non-regular” workers—those who work part-time, as day-labourers, for a fixed duration, or under agency contracts. “Regular” workers enjoy benefits such as housing, bonuses, training and (usually) lifetime employment, but non-regular workers earn as little as 40% of the pay for the same work, and do not receive training, pensions or unemployment insurance. In the past 20 years their numbers have grown to one-third of all workers.”

Unemployment is concentrated among non-regular staff

25 Mar 2009. NLI Research paper.

http://www.nli-research.co.jp/english/economics/2009/eco090325.pdf

“How the Rapid Growth of Non-Regular Employees Will Impact the Next Round of Employment Adjustment. by Taro Saito”

“Employment has always been unstable for non-regular employees, regardless of the economy’s condition. In fact, by type of employment, the unemployment rate of regular employees (in the past year, the number of regular employees who became unemployed, divided by the total number of regular employees) has been remarkably stable at around 2%. By comparison, the unemployment rate has hovered at around 4% for part-time workers, and fluctuated widely around 10% for temporary staff workers”

Rigidity in employment

20 Nov 2010. Economist pi7.

http://www.economist.com/node/17492778?story_id=17492778

“Insiders and outsiders”

“But Japanese firms’ hiring practices remain inward-looking, which means their workforce may lack a global perspective. The big firms take on as many students as they can from top Japanese universities, irrespective of their skills or outside interests. They hire almost exclusively upon graduation, so studying abroad during the recruitment period is bad for applicants’ job prospects. Even Japanese graduates with PhDs from foreign universities despair of getting jobs at big Japanese firms because they will be seen as overqualified. By and large Japan remains a “one-shot society”: those who fail to get a good job upon graduation can be frozen out for life. …

The company song may have gone, but for the moment loyalty, character-building induction rituals and rigid hierarchies remain common for fast-track managerial employees. Japanese workers introduce themselves by their company name first and their own name second, and are far more likely to define themselves by whom they work for than by what they do. This is true even in Japan’s most global companies. “In the United States you are always dating the company,” says one executive. “Our employees marry us.””