>From: "Ulhas Joglekar" <[EMAIL PROTECTED]> >Reply-To: [EMAIL PROTECTED] > >3 February 2000 >Japan workers pressed to accept pay cuts >TOKYO: Japan is gearing up for its annual "shunto" spring labour >negotiations with employers seeking the first wage cuts in decades in >exchange for promises of job security. >With the traditional lifetime employment system starting to crumble and the >economy still in the doldrums after a prolonged recession, the focus of this >year's wage talks is whether workers will be able to win bigger paychecks -- >and keep their jobs. >Under a system introduced more than 40 years ago, management and labour >representatives hold collective shunto wage talks from mid-February until >March to seek unified wage hikes. >Japanese employers, under intense pressure to improve profitability and >competitiveness in a tough global marketplace, say they must move ahead with >drastic reforms and cut costs. >In a report released last month, the powerful Japan Federation of Employers' >Associations argued that wages paid by Japanese companies were the highest >in the world and hefty labour costs were impeding corporate growth. >"It's impossible to keep both employment and higher wages at the same time >under the current economic circumstances," said Hiroshi Okuda, head of the >federation. >"If employers were to set aside more costs for each employee, many of them >would have no option but to cut the number of workers, even against their >will," he said. >Many analysts believe that Japanese managers are so concerned about >corporate image that they will shy away from taking drastic measures to cut >a large number of jobs, thus possibly putting an end to the lifetime >employment system. >"Japanese companies will go through a gradual process of restructuring over >the next several years," said Kazutaka Kirishima, chief economist at the >Research Institute of Sumitomo Life Insurance. "They can't resort to drastic >means at once." >The Japanese Trade Union Confederation (Rengo), which represents eight >million workers from across most industries, is aiming for an average pay >raise of three percent for the year starting on April 1. >Last year, the average increase was a record low 2.21 percent, and >economists say it will probably go even lower to two percent this year. >Rengo says employers should improve their business strategies and streamline >costs without laying off employees. >Union leaders insist higher wage increases are vital to boosting the >flagging Japanese economy, by stimulating consumer spending and domestic >demand. >"To boost spending, we must win a pledge from the employers to increase >wages," said Rengo chief Etsuya Washio. >Nikkeiren's Okuda argued there was no direct link between wages and consumer >spending, a driving force in Japan's economy. Some economists disagree. >"If wages drop and job insecurity remains high, consumer spending will never >increase," Kirishima said. That could hamper Japan's tentative move towards >economic recovery after its worst recession since World War Two. >Kirishima said a small wage hike could in fact hurt growth by putting a new >damper on spending among people who for the first time in decades face the >threat of job losses. "It would have a significant psychological impact on >the economy," he said. >Japan's unemployment rate in December climbed 0.1 percentage point from >November to 4.6 percent, or 2.88 million workers. This halted a steady >improvement in employment conditions since the rate peaked at a record high >of 4.9 percent in June and July. >Rengo's Washio accused employers of trying to scrap the traditional practice >of paying workers according to a seniority-based formula rather than by >performance. >"There is a seniority-based wage system even among professional baseball >players," he said. "It is difficult to create clear standards to assess job >performance objectively." >In a rare and bold move to break with the tradition, electronics maker >Toshiba Corp said this week it would introduce a merit-based wage scale from >April. >This year's spring labour offensive is expected to reach a climax on March >15 and 24, when most major unions are expected to receive replies from >management on their wage demands.(Reuters) >For reprint rights: Times Syndication Service >|Disclaimer| >For comments and feedback send Email >Bennett, Coleman & Co. Ltd. 1999. > > __________________________________ KOMINFORM P.O. Box 66 00841 Helsinki - Finland +358-40-7177941, fax +358-9-7591081 e-mail [EMAIL PROTECTED] http://www.kominf.pp.fi ___________________________________ [EMAIL PROTECTED] Subscribe/unsubscribe messages mailto:[EMAIL PROTECTED] ___________________________________
