One of the difficulties of managing Japan's 1990s economic crisis was their cultural reliance on lifetime employment. In Japan, workers devote their lives to their employer, as the company is more important than family. In return for their loyalty, workers are essentially guaranteed employment for life.
Japan ramped up temporary worker hiring in the 1990s and this employment shift was credited with helping to pull Japan out of their decade plus spiral. While helping the economy, it caused other problems. There's been a growing income divide that had been unheard of in Japan previously. (Temporary workers are paid 30-40% less than their counterparts). This divide started to cull a second class citizen mentality. Yet, many young Japanese expressed a preference for temporary work as it allowed them to dodge the responsibilities of full-time employees, such as working late each night.
Except, now that the economy is contracting again the temporary workers are the first to go.
At 3.7% Japan's unemployment rate is low compared to the U.S. rate of 6.7%. Both countries are expecting more layoffs in the upcoming months.
http://www.bloomberg.com/apps/news?pid=20601101&sid=ab4g.SY6x5dA&refer=japan
http://www.bls.gov/news.release/empsit.nr0.htm
Showing posts with label unemployment. Show all posts
Showing posts with label unemployment. Show all posts
Friday, December 5, 2008
Friday, November 7, 2008
It's not the bottom
Asian markets closed mixed today as they waited for new economic data from the US. That data arrived and it's not good. The unemployment rate is 6.5%, a 14 year high. Add that to terrible October retail sales reports and I'm guessing Monday is not going to dawn on the up side.
Additionally, the New York Times reported today that China's "three engines of growth - exports, investment and consumption - have all slowed down." Not only are real estate and related industries down, but due to poor orders from retailers, factories are laying off workers. The Chinese economy is still expanding, but at a rate of 5.8 percent instead of last year's 11 percent.
The Chinese government, always wary of the restless unemployed, is putting together an economic stimulus package including infrastructure, exporters and aid to real estate, stock markets.
In Japan, Toyota Motors Thursday announcement that they had cut their annual profit forecast in half made a big impact. The Nikkei fell 3.5 percent.
Sources: http://www.nytimes.com/2008/11/07/business/worldbusiness/07yuan.html
http://www.nytimes.com/2008/11/08/business/08markets.html
Additionally, the New York Times reported today that China's "three engines of growth - exports, investment and consumption - have all slowed down." Not only are real estate and related industries down, but due to poor orders from retailers, factories are laying off workers. The Chinese economy is still expanding, but at a rate of 5.8 percent instead of last year's 11 percent.
The Chinese government, always wary of the restless unemployed, is putting together an economic stimulus package including infrastructure, exporters and aid to real estate, stock markets.
In Japan, Toyota Motors Thursday announcement that they had cut their annual profit forecast in half made a big impact. The Nikkei fell 3.5 percent.
Sources: http://www.nytimes.com/2008/11/07/business/worldbusiness/07yuan.html
http://www.nytimes.com/2008/11/08/business/08markets.html
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