If I describe the current employment situation in Japan by one word, the increase of unemployment rate is getting escalated and intensified.
Let's see transition of unemployment rate in Japan. From 1960 to 1974, the rate was hovering around 1%. From 1975 to 1994, it was hovering around 2%. It seems that the rate increased in response to transition from highly-developing economic period to stable-growth period. But since 1991 when bubble economy collapsed, the speed of worsening economy has escalated. From 1995 to 1997, the rate reached 3%. Last year it reached 4.1% and rose to 4.6% this February.
Another characteristics is the increase of householders who lose their jobs. The average unemployment rate of households was 2.9% last year. This means that families lose sources of income. We understand that unemployment became serious enough to bring instability to family.
And also, non-voluntary unemployed, people who are forced to leave jobs by company, are increasing. The situation is serious particularly among middle-aged and elderly people(45|64 years old). The average unemployment period is also prolonged and reached 4.2 months. Any data shows seriousness of unemployment.
In the prolonged economic downturn, the amount sold of many Japanese companies remains at the same level or is decreasing. Facing zero growth, companies reduce fixed cost to revive productivity. By reexamining personnel expenses and excessive facilities, companies try to revive performance. Actually, many big companies reduced the number of persons drastically. In labor offensives this spring, many employers proposed "restraint of total personnel expenses." This means that companies try to restrain the total personnel expenses by reexamining welfare and wage system.
Because of this employment instability, people try to restrain consumption through the form of "defense of life." "Defense of life" causes companies which are suffering from decline of the amount sold to promote restructuring. Restructuring of companies creates anxiety of lifeccCompanies and consumers are trapped by "spiral of anxiety." Rational activities of consumers and companies bring decline to macroeconomics of Japan as a result. |
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