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2018 | OriginalPaper | Chapter

1. Overview

Authors : Akiomi Kitagawa, Souichi Ohta, Hiroshi Teruyama

Published in: The Changing Japanese Labor Market

Publisher: Springer Singapore

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Abstract

This chapter examines some basic labor statistics that will help one better understand the changing nature of the Japanese labor market. After briefly reviewing the history of the labor market since World War II, we analyze in depth the secular increase in the unemployment rate during the 1990s, which was the fundamental problem of the Japanese labor market during the so-called lost decades. We find that labor flows and unemployment spells play an important role in the long-run increase in the unemployment rate. Further, we examine the issue of the Japanese employment system, characterized by a long-term employment relationship and a steep wage-tenure profile. It is shown that, in the long-run, job-worker attachments have become weaker and wage growth within a firm has been stagnant. The chapter goes on to provide a bird’s-eye view of a recent crucial change in the Japanese labor market: the rising proportion of non-regular workers. This chapter also summarizes the findings of the subsequent chapters and discusses some policy implications of this book as a whole.

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next chapter Flatter Wage Profiles and Reduced Lifetime Employment: A Simple Formalization

The definition of a non-regular worker is not univocal. We discuss this point in Sect. 1.7.1.

Rebick (2005), for example, cites the following 12 features: long-term employment, enterprise-based unions, pay rises with age and seniority, high rates of employee participation and involvement in decision making, large gender-based differentials and gender-based segregation in the labor market, differentiation by firm size, internal training within companies, age-based discrimination, status differences (difference between “regular” and part-time or temporary-contract-based employees), widespread use of mandatory retirement systems, a well-organized entry market for new graduates to obtain jobs, and internal mobility between establishments in large companies.

The Basic Survey on Wage Structure calls them “ordinary workers.”

In the Basic Survey on Wage Structure, employees who join an enterprise immediately after graduating from schools and universities and continue working for the same enterprise are called “standard employees.” More specifically, standard employees are employees whose age minus their length of service is 15 for junior high school graduates, 18 for senior high school graduates, 20 for a technical/junior college graduates, and 22 or 23 for university (excluding graduate school) graduates.

Here, the mean is calculated after discarding the highest and lowest values. This is considered less sensitive to outliers than the usual mean.

As we will see in detail, full-time workers, as defined thus far, can include a part of non-regular workers, depending on the definition of the latter.

According to Ogura (2002), atypical workers sometimes include the self-employed. Since the Labour Froce Survey targets employed persons, we use the word “employee” and “worker” interchangeably in this section.

See “General Survey on Diversified Types of Employment 2014” by Ministry of Health, Labour and Welfare.

It should be noted that not all types of non-regular workers are included in this category.

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Title: Overview
Authors: Akiomi Kitagawa
Souichi Ohta
Hiroshi Teruyama
Publisher: Springer Singapore
Book: The Changing Japanese Labor Market
Print ISBN: 978-981-10-7157-7

Electronic ISBN: 978-981-10-7158-4

Copyright Year: 2018
DOI: https://doi.org/10.1007/978-981-10-7158-4_1