Japan's High Unemployment Sparks Fears

by Suvendrini Kakuchi

"At least, for the moment, government workers do not have to worry about being fired," he says. "That's why I made the change, even though my former job was more exciting."

Sato is right in considering himself fortunate. All over Japan, workers are losing their jobs, and labor experts predict the situation will worsen in the coming months.

The country's unemployment rate already reached a record high in September -- 4.7 percent, or 3.2 million people -- according to the Management and Coordination Agency. But labor experts say the real rate is much higher, reaching as much as 10 percent in this country of 130 million people.

"Japan's unemployment figure is grossly understated because it reflects only the number of people who report they have no jobs," says Susumo Saito, director of the Trilateral Institute Inc., a private economic thinktank.

He adds, "It does not take into account the large number of job seekers and the category where people have just given up hope for re-employment because the situation is so hopeless."

Official statistics show that there are about 9.4 million Japanese currently looking for work.

The government acknowledges that the Japanese job market can absorb only half the number of people seeking work. According to experts, corporate restructuring brought on by the prolonged recession and globalization is mainly to blame for the country's dismal labor situation.

In a country where lifetime employment used to be a given, the new instability has proved a particularly heavy psychological burden for many people.

Managers Union chief Hiromitsu Yamazaki notes, for example, that there are hundreds of middle-aged men who suffer from depression but are not counted as unemployed because they are too sick to register as such.

Those still punching in the clock are also under stress as they worry over impending unemployment or try to cope with an ever increasing workload. A Labor Ministry survey conducted in August indicates that two-thirds of those who are still employed fear they may be out of work soon.

Experts say a rise in "karoshi," or death from overwork, can only be expected to rise from the current 10,000 cases recorded annually by the Labor Ministry.

Saito says suicides stemming from work-related problems on the increase as well. Last year, Japan recorded 33,048 suicides, a sharp rise from the 21,346 posted in 1990. Statistics show that more than 74 percent of the men over 40 who took their lives last year did so because of work problems.

Meanwhile, Yamazaki says that Japanese society will soon have to deal with a growing gap between workers with steady but small paychecks and part-time and contract workers who bring home substantial sums.

"You can see the trend even now where financial liberalization has helped develop profit-driven securities companies, which employ a younger sector that receives double or treble the salary of the average worker who has put in 20 to 30 years for his company," he says.

In truth, Mayumi Ofuku of the Electrical Workers Union says the electronic industry has recorded the biggest changes in the last few years as Japan shifts away from "traditional" manufacturing to the IT (information technology) industry.

It is the IT industry that is moving away fast from salaried workers and taking on younger contract workers, says Ofuku.

Salaries in this sector depend on innovation rather than the seniority of the employees, he points out, adding that the trend is bound to have an impact on how unions deal with management.

At present, Japanese unions, which represent about 20 percent of the total number of the workforce, still use the method of collective bargaining in negotiating salaries. But Ofuku says tactics and focus will have to change as workers develop separate contracts with different companies.

He says unions will then have to focus on individual needs, and even the old "spring campaign," when unions come together to demand higher salaries, will be replaced with demands for better working conditions.

Ofuku predicts such demands would include less overtime, better part-time conditions and paid holidays.