Wave of Layoffs Dashes Japanese Myth of Job for Life

Free-market reforms including deregulation in 2004 has allowed the manufacturing industry to use temporary staff in their plant.

Temporary workers like Toshie Helena Oguihara were a driving force behind Japan's economic recovery in recent years, but when the recession returned they found themselves first in the firing line. Japanese companies have announced thousands of lay-offs among contract or temporary employees in recent weeks in response to the economic crisis.

The wave of job cuts has shattered the myth that a job is for life in Asia's largest economy, which traditionally prided itself on a middle-class lifestyle.

When auto plants slowed their assembly lines due to slumping demand, Oguihara -- a 50-year-old Japanese-Brazilian -- was among those out of a job. The small subcontractor plant producing air-conditioning compressors for Japan's leading automaker, Toyota Motor Corp., no longer needed her. "I was fired because I was a Brazilian, and a temporary employee, even though I had been a hard worker for the past three years," said Oguihara, one of some 300,000 Japanese Brazilians in Japan who are allowed to stay longer than most unskilled foreign workers because of their ancestral ties. "I may have to return to Brazil if I can't find a new job," Oguihara lamented. She has been in Japan for most of the time since 1997, working for auto plants scattered around Toyota city in central Japan -- home to mighty Toyota and a number of smaller subcontractors.

Many other Japanese Brazilians, including her cousin who has worked at a plant for the electronics titan Sony, have also lost their jobs amid the recession, leaving them with the problem of finding somewhere to live and education for their children who are used to living in Japan, she said.

It's not just foreigners losing their jobs. Japanese temporary workers -- who make up an increasingly large share of the workforce following the deregulation of the labor market in recent years -- have also been affected.

Japanese have traditionally seen themselves as a equitable, middle-class society thanks to life-time employment and a narrow gap between the rich and the poor. But critics say those days are gone, largely because of free-market reforms including deregulation in 2004 that allowed the manufacturing industry to use temporary staff in their plants.

Today, roughly one in three workers in Japan are non-regular employees, including temporary workers who generally receive lower wages than permanent workers -- a group often described as "the working poor." Many workers find themselves with nowhere to live when they lose their jobs -- and with it the cheap company dormitory they were living in, said Yoshimitsu Wada, a trade union leader for temporary workers. "Can this country have this kind of cruel society?" Wada said.

Some temporary workers began fighting against company managers with demonstrations and lawsuits, but legal battles are tough for workers to win, said Wada. "We eventually need to reform a labor law," he said.

In one novel solution, the small city of Kitsuki in southern Japan has offered jobs and even cabins at campsites to the 1,100 contract workers axed locally by a subsidiary of office equipment and camera maker Canon Inc.

But the problem keeps growing. The latest government survey out last week said that more than 85,000 temporary workers have lost or know they will lose their jobs by next March.

"Japan's deregulation has gone too far," said Toshiaki Tachibanaki, professor of economics at Doshisha University. "It has changed the employment structure in favor of corporate management, which in turn stirred anxiety among the public over their everyday lives," he said.

Prime Minister Taro Aso's government in November submitted a revision to the law on temporary workers to parliament to tighten the rules. The opposition bloc is also seeking tougher regulations. "Now, the problem of a free-market model is under scrutiny even in the United States. It's time to review the past policy in Japan, too," Tachibanaki said.

Copyright Agence France-Presse, 2008

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