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Recession hits Japan's part-time workers

Sony said Tuesday it will let 16,000 employees go – half of them from its temporary staff.

By Takehiko KambayashiCorrespondent of The Christian Science Monitor / December 10, 2008

Jobs: More than 2,000 people rallied in Tokyo Dec. 4 to protest an amendment that they say doesn't do enough to limit part-time work.

Takehiko Kambayashi

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Tokyo

In a country once famous for offering employees lifelong job security, Japan is struggling with rising unemployment as its recession deepens and top companies like Toyota and Sony cut costs.

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From government leaders to antipoverty activists, many people worry that a burgeoning class of contingent (part-time or contract) workers – which came into existence only some 20 years ago – will bear the brunt of job losses.

More than 30,000 of them have lost or will lose their jobs from October to next March, a recent government survey shows.

Major automakers recently announced that they would slash the number of contingent employees due to slow sales. Toyota reports that its number will fall from 9,200 early this year to 3,000 by the end of next March. Mitsubishi Motors Corp. says it will not renew 1,100 contract staff from now until next March. Mazda Motor Corp. is eliminating 1,300 temporary jobs.

Meanwhile, Sony, the world's second-largest maker of consumer electronics, announced Tuesday it would cut 8,000 temporary and contract staff alongside 8,000 regular workers.

Employment situations "could become very serious. Those on contract will be kicked out of a company's dormitory once their term expires," says Ken Kikuchi, a labor union member. "Setting up hotlines, we got swamped with calls from those who have already lost a job or fear they could."

Japanese companies were once famous for their tradition of "lifetime employment" for new hires. High school and college graduates could find a job and keep it until they reached mandatory retirement.

In 1986, however, a law passed allowing companies to hire temporary workers. Further deregulation in 1999 increased the number of such contingent workers.

After a 2004 amendment expanded the types of businesses that could use contingent workers, including in manufacturing, their numbers rose to 17 million – more than one-third of the entire workforce. In 1990, by comparison, contingent employees made up 20 percent of all the workforce, at 8.7 million.

"Many companies benefited from the economic boom by holding down labor costs by increasing the use of contingent workers," says Takeo Kinoshita, a professor of labor issues at Showa Women's University. "Business leaders think they are fine as long as their company is profitable in the short run. They would not think about this country's future."

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