Recession hits Japan's part-time workers

In a country once famous for offering employees lifelong job security, Japan is struggling with rising unemployment as its recession deepens and top companies like Toyota and Sony cut costs.

From government leaders to antipoverty activists, many people worry that a burgeoning class of contingent (part-time or contract) workers – which came into existence only some 20 years ago – will bear the brunt of job losses.

More than 30,000 of them have lost or will lose their jobs from October to next March, a recent government survey shows.

Major automakers recently announced that they would slash the number of contingent employees due to slow sales. Toyota reports that its number will fall from 9,200 early this year to 3,000 by the end of next March. Mitsubishi Motors Corp. says it will not renew 1,100 contract staff from now until next March. Mazda Motor Corp. is eliminating 1,300 temporary jobs.

Meanwhile, Sony, the world's second-largest maker of consumer electronics, announced Tuesday it would cut 8,000 temporary and contract staff alongside 8,000 regular workers.

Employment situations "could become very serious. Those on contract will be kicked out of a company's dormitory once their term expires," says Ken Kikuchi, a labor union member. "Setting up hotlines, we got swamped with calls from those who have already lost a job or fear they could."

Japanese companies were once famous for their tradition of "lifetime employment" for new hires. High school and college graduates could find a job and keep it until they reached mandatory retirement.

In 1986, however, a law passed allowing companies to hire temporary workers. Further deregulation in 1999 increased the number of such contingent workers.

After a 2004 amendment expanded the types of businesses that could use contingent workers, including in manufacturing, their numbers rose to 17 million – more than one-third of the entire workforce. In 1990, by comparison, contingent employees made up 20 percent of all the workforce, at 8.7 million.

"Many companies benefited from the economic boom by holding down labor costs by increasing the use of contingent workers," says Takeo Kinoshita, a professor of labor issues at Showa Women's University. "Business leaders think they are fine as long as their company is profitable in the short run. They would not think about this country's future."

A Toyota public relations official, who asked not to be named, says that the company "has to protect the employment of regular workers." The company gave full-time jobs to 1,250 contingent employees during the fiscal year ending March 2007, he adds.

Not only do contingent employees tend to be the first ones cut, they also have less of a safety net to fall back on. "Unlike labor unions in the US, those in Japan are formed within a company to protect their regular employees," says Professor Kinoshita. "Nonregular employees are not under their umbrella."

In recent years, contingent workers have begun forming labor unions, which conduct collective negotiations on behalf of members.

In a country where few workers complain in face-to-face conversation, the Internet has become a helpful outlet for expressing worries and frustrations. When the Japanese Trade Union Confederation created a bulletin board for people to air their complaints, more than 126,000 visitors posted anonymous comments within two months.

"Kenji," a high school dropout, had been a low-paid contingent worker for more than 10 years until recently. "[No matter] how hard you work, you are in big trouble. I hear more people say 'It's better to be a criminal,' " he says.

"Whenever my ex-girlfriend and I started talking about marriage, she ended up asking me, 'Can you put food on the table?' " Kenji continues. "I no longer think about marriage and children, because it's just impossible."

The job cuts are likely to have a wider economic and social fallout. "As companies have produced a large stratum of people who can spend less, you could never turn the economy around," says Karin Amamiya, author of a book on destitute youth and advocate for the poor. "If the issue of unstable employment is left unsolved, we will see a great throng of the homeless on the streets."

The government has urged action to reduce unemployment, but faces criticism for not doing enough. On Monday, Prime Minister Taro Aso urged business leaders to secure employment and raise wages. An official at the Ministry of Health, Labor, and Wealth says the government encourages companies to hire workers full time, though its targets are nonbinding.

To prevent a further increase of working poor, some opposition lawmakers argue that the use of nonregular workers in the manufacturing industry should be banned. The government opposes such a change, arguing that some people still want temporary work.

According to Asahi, a major newspaper here, approval ratings for Mr. Aso's cabinet have fallen to 22 percent from 48 percent in September, when he took office.