The Japan Labor Flash
No.46
Email Journal September 15, 2005
Statistical Reports
Recent Statistical Survey Reports
Current Topics
Results of Spring Wage Negotiations in Major Firms and Wage
Determination Methods Favored by Employers
Working Married Couples: Husbands Spend 1.6 Hrs and Wives 5.7 Hrs
on Housework and Child-Rearing
Public Policies
Ministry of Health, Labour and Welfare Requests General Account
Budget Allocation: 15.3 Billion yen to Make 250,000 Freeters
Regular Workers
National Personnel Authority Recommends Radical Reform of Salary
Structure: Monthly Salary of National Civil Servants to Drop by
0.36%
Public Policies
Nissan Creates a New Post of CIO Responsible for Pension Fund
Management
More Part-Timers Become Regular Employees in a Wider Range of
Industries
Public Policies
Psychological Disturbances Never Disappear
Statistical Reports
-Recent Statistical Survey Reports August 2005-
Features
Basic Survey on Schools (FY2005)
Report on Employment Service (July)
http://www.jil.go.jp/english/estatis/esaikin/2005/e2005-08.htm
Current Topics
-Results of Spring Wage Negotiations in Major Firms and Wage
Determination Methods Favored by Employers-
In late August, the Ministry of Health, Labour and Welfare announced
the 2005 "status of wage hike demands and settlements in spring joint
labor negotiations of major firms in the private sector." Data on
the amounts settled for were obtained for 251 firms out of all firms
capitalized at 1 billion yen or more with 1,000 or more employees
and their own labor union. These data show that the average pay
hike (weighted average including regular pay hike) was 5,422 yen,
a wage hike rate of 1.71 percent. The figure was higher by 74 yen,
or 0.04 percent, than the level marked last year.
Among unions surveyed, 78.6 percent had submitted their demands
by early March, and a high proportion, 85.5 percent, saw a settlement
between mid- and late March.
Around the same time, Nippon Keidanren (the Japan Business
Federation) published the results of a survey aimed at top-level
management concerning the 2005 spring labor-management negotiations.
When asked about the ideal wage determination method for the future,
a mere 9.3 percent of the management surveyed replied that regular
pay hikes should be placed at the center, and that the basic pay
hike should be carried out if necessary, whereas 45.3 percent (down
from 56.9 percent last year) replied that regular pay hikes should
be abolished and wages should be determined in accordance with
achievement and performance. On the other hand, the proportion of
firms which responded that wage determination should rely solely
on regular hikes and that achievement and performance should be
reflected in bonus payments, increased from 30.4 percent last year
to 36.0 percent. These survey results reflect a strong inclination
among corporate managers to adopt a merit-based wage determination
system.
-Working Married Couples: Husbands Spend 1.6 Hrs and Wives 5.7 Hrs
on Housework and Child-Rearing-
The Dai-Ichi Life Research Institute Inc. recently published the
findings of a survey on work and family life among double-income
married couples. The survey was aimed at 420 households in Tokyo
and Chiba prefecture in which both husbands and wives work and leave
their children at nurseries. The results show that the average
husband spends 1.6 hours per day on housework and child-rearing on
weekdays, while the average wife spends a considerably longer amount
of time, 5.7 hours. Hours spent by husbands on housework and child
-rearing show almost no variation, regardless of the employment
status (i.e., regular employees or part-time workers) of their wives.
Public Policies
-Ministry of Health, Labour and Welfare Requests General Account
Budget Allocation: 15.3 Billion yen to Make 250,000 Freeters Regular
Workers-
At the end of August, the Ministry of Health, Labour and Welfare
compiled an estimated budget request for fiscal year 2006. The request
for the general account budget allocation increased to 21.54 trillion
yen, 7.24 trillion yen over the allocation for this fiscal year.
The major budget allocation items are: (i) 3.35 trillion yen for
improvements in child care services, such as the "program to reduce
to zero the number of children on waiting lists for nurseries";
(ii) 13.7 billion yen for promoting a balance between work and family
life, for example, by granting subsidies to small and medium-sized
enterprises where workers for the first time can apply for child
-rearing leave or shorter working hours; (iii) 1.53 billion yen for
the promotion of independence among young people as persons with
regular occupations, for example, by establishing "support stations
for local youth" (provisional title) to help NEETs become independent;
(iv) 1.53 billion yen for promotion of a plan to shift 250,000 freeters
to regular employment; (v) 2.62 billion yen for employment measures
focusing on regions where the unemployment situation is severe;
(vi) 2.25 trillion yen for steady implementation of the revised
nursing care insurance system and promotion of related measures;
and (vii) 12 billion yen for promotion of measures to prevent suicide.
US$=\110 (September 15, 2005）
-National Personnel Authority Recommends Radical Reform of Salary
Structure: Monthly Salary of National Civil Servants to Drop by 0.36%-
On August 15, 2005, the National Personnel Authority (NPA)
recommended to the Diet and Cabinet that the government should reduce
monthly salaries of national civil servants for fiscal year 2005 by
1,389 yen (0.36 percent), but raise the term-end and diligence
allowances (annual bonus payments) by the equivalent of 0.05 percent
of a month's salary, to an amount equivalent to 4.45 months' salary.
In all, annual incomes will drop by 4,000 yen, or 0.1 percent,
on average.
At the same time, the NPA has proposed a gradual cut in basic
salaries of local civil servants, which currently exceed salaries
in the private sector, starting in fiscal year 2006, with the goal
of achieving a reduction of 4.8 percent over a five-year period.
It has also called for a "radical reform" of the wage structure
itself, which has kept its current form for 48 years, proposing
that the current seniority wage profile be revised by cutting wage
levels for middle-aged and older workers by 7 percent while
maintaining the current level for younger workers. It has also
recommended the adoption of an appraisal and promotion system
linked to performance.
Whether or not the recommendations are put into effect will be left
in the hands of the newly inaugurated Cabinet. Revision or otherwise
of the pay system for local civil servants is at the discretion of
individual municipal governments, but a backlash from the labor
unions, among other obstacles, may be expected.
See Public Policies of JLF No. 34
http://www.jil.go.jp/english/archives/emm/2005/34.html
Public Policies
-Nissan Creates a New Post of CIO Responsible for Pension Fund
Management-
Nissan Motor Co., Ltd. has created the new post of Chief Investment
Officer (CIO) to take charge of general pension fund management for
the group as a whole. By stationing an expert on pension fund
management within the company, Nissan aims to improve fund management,
which is likely to have an impact on the business performance of
the company itself.
The task assigned to the new CIO is to obtain the annual 3.0% yield
on pension funds, which is the prerequisite for the company's pension
scheme. The CIO will also be responsible for selecting fund management
companies to take charge of the selection and management of shares,
bonds and other investments. A substantial portion of his remuneration
will be determined in accordance with his performance in fund management.
In Japan, most firms leave the management of their pension fund to
a "pension fund" company because the latter organization, which
is
in charge of managing corporate pension premiums, is separate from
the company itself. However, taking into account the fact that poor
pension management can cause fluctuations in the company's profits,
Nissan has decided that corporate financing and pension financing
should be managed by a single unit. If the new CIO shows outstanding
performance in his new role, the new system will likely draw attention
from other companies.
(Nippon Keizai Shimbun, September)
-More Part-Timers Become Regular Employees in a Wider Range of
Industries-
Firms in various industries are actively promoting part-time
workers to regular employees, their aim being to pull in more
customers and restore profit levels by raising the morale of workers,
thus improving service quality. Behind this trend lies the fact that
firms are now obliged to prevent corporate misconduct and are
beginning to shift their emphasis from cost reduction to long-term
growth. Ringer Hut Co., Ltd., a food service business, will roughly
double the number of regular employees allocated to its branches by
February 2008, while McDonald's Japan will recruit 4,500 persons
(an increase of about 15 percent) as candidate branch managers,
regardless of whether they are newly graduated.
In September, Seiyu, a leading supermarket, has begun an executive
development program to train candidates for store superintendent
and manager positions. While there have been some cases in the
food-service industry where part-time workers were promoted to store
managers, it is rare among leading supermarkets. The training program
will target 350 workers, of whom approximately 100 are part-time.
By the end of this year, the number of part-timers qualified as
managers or higher is expected to be more than 1,000 (which is
equivalent to the total 3 percent of number of part-time workers).
(Nihon Keizai Shimbun, September)
Public Policies
-Psychological Disturbances Never Disappear-
If it is true that people's minds reflect the state of society,
it seems likely that there is something wrong with present-day Japan.
A survey, conducted for the first time in the last two years by
the Mental Health Research Institute of the Japan Productivity Center
for Socio-Economic Development and focusing on steps by labor unions
to deal with mental health problems, has revealed that mental health
among workers has worsened.
Continued on;
http://www.jil.go.jp/english/archives/emm/2005/no.46/46_si.html
