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Japan's `Real' Jobless Rate Could Soon Exceed US Level

Surplus staff and discouraged workers are not counted

UNEMPLOYMENT is on the rise in Japan. Some even suggest that Japan's ``real'' jobless rate could soon surpass that of the United States, if the economic recovery does not take hold.

The official unemployment rate has risen from 2.2 percent a year ago, to 2.9 percent in February. By European or US standards this is enviably low. Yet experts agree that the actual rate is significantly higher.

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Part of the discrepancy is because Japanese statistics are less accurate than those of other industrial nations, explains Marilyn Saso, economics professor at Tokyo's Temple University and a member of the Economist Intelligence Unit, a research division of the Economist magazine.

``One example is the popularity of family businesses in Japan,'' Professor Saso says. ``These businesses hire relatives who do not contribute to output but are not officially unemployed.''

Government figures also do not take into account surplus staff, unemployed foreigners, and some unemployed women. If these people were included, Japan's official unemployment rate could double.

There are now only 65 job offers for every 100 job seekers in Japan. Meanwhile, 60 percent of companies are making moves to reduce their work force, a Kyodo News Service survey found.

Some of Japan's biggest companies are affected. The national telephone operator, Nippon Telephone and Telegraph, has cut 44,000 jobs since 1990. A spokesman says the company has used ``a voluntary retirement program and a recruitment freeze'' to avoid outright layoffs.

Toyota, the nation's largest automaker, is also being forced to restructure its work force. Hiring has been reduced and part-time employment completely done away with. In 1992, the company had 2,700 part-time workers. Today it has none.

Even as they cut workers, few Japanese companies are prepared to make mass redundancies. Such reluctance has its origins in Japan's employment traditions. Although a decreasing number of companies favor lifetime employment, most still tacitly promise stable, long-term jobs.

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``There is no layoff system and it is generally very difficult to dismiss personnel,'' according to Shinji Fukuzawa and Tomoko Ina, co-authors of the book, ``Nippon: the Land and its People.''

A company's employment record is vital to its reputation. ``Firms who break their promises cannot recruit first-class workers in the future,'' claims a recent graduate from the prestigious Waseda University in Tokyo. ``I will not work for a firm with a reputation for layoffs, like Pioneer.''

The electronics giant has been singled out by wary graduates since it abruptly laid off 35 middle managers last year.

Since dismissing personnel is risky, only the most vulnerable workers are usually laid off. Rodo Bengodan, a lawyers group specializing in labor disputes, reports that part-time workers, foreigners, and workers at small companies lose their jobs most frequently.

Small companies, which have suffered most from the recession, do not have high-profile reputations to protect. Unskilled workers in these vulnerable firms are bearing the brunt of direct dismissals.

One worker at a small food wholesaler, who only gave his name as Takahiro, says he was fired as soon as the recession hit in early 1992. Unemployed workers such as Takahiro are generally included in government surveys. Since foreigners who are not married to Japanese citizens must leave Japan once their employment is terminated, they cannot be classified as jobless.

With little recognition of their situation, many foreign workers are insecure about their future. A Chinese national, who has been working at a Yokohama construction firm for five years, confesses: ``I'm worried.''

Traditional preferences for male workers also are surfacing. The government research institute, Japan Productivity Center in Tokyo, found that 51 percent of companies only hire men for career positions. Many women are forced into part-time jobs. ``My friends and I still do not have full-time work, although we've been looking for over six months,'' reports a female graduate from secretarial college. ``Most of my male friends have got jobs.''

In 1993 alone, female unemployment rose 20.5 percent to 3.2 percent.

Saso, author of a study called ``Women in the Japanese Workplace,'' argues that the figure would be even higher, except that many women have stopped hunting for jobs. The number of women in the work force has fallen by 0.8 percent over the past year, creating an invisible pool of ``discouraged workers.''

Despite these adjustments, firms remain burdened by surplus workers, dubbed madogiwa-zoku (those who sit by the window). Labor Ministry officials estimate that Japanese companies have about 400,000 madogiwa-zoku. Private economists put the number at 1 million.

Sumitomo Life Research Institute has reportedly calculated that if such idle workers are included, Japan's total unemployment rate is nearer 6.3 percent. This estimate does not take into account foreigners, ``discouraged workers,'' or underemployed workers in family businesses.

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