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A scene from the railroad extension work for the Kyushu Shinkansen (in Fukuoka Prefecture). Construction of a Shinkansen line begins with civil engineering work to build viaducts, tunnels, etc., followed by track construction to lay rails, with electrical system installation work culminating in the final stage of the whole process. The complete Kyushu Shinkansen line (Kagoshima Route) opened for operation in March 2011.
Japan's labor force was on a continuous decline after recording a historical high of 67.93 million people in 1998. It showed growth from 2005 due to the increased labor force participation rate of, mainly, the elderly. In 2008, however, the figure started declining again because of the employment climate worsening as a result of the economic downturn. The labor force is expected to shrink in the long run as the falling birthrate and the aging population change the population composition.
The labor force, defined as the sum of the employed and unemployed, numbered 65.90 million people in Japan in 2010, down 270,000 (0.4 percent) from the previous year and was the third consecutive year of decrease.
The 2010 labor force participation rate (rate of the labor force to the population aged 15 years and over) was 59.6 percent (down 0.3 percentage point from the previous year). Observed by gender, the rate was 71.6 percent for men (down 0.4 percentage point) and 48.5 percent for women (unchanged).
The female labor force participation rate by age group shows an M-shaped curve. This curve indicates that women leave the labor force when they get married or give birth to a child and then rejoin the labor force after their child has grown and the burden of child-rearing is reduced. A comparison with the data from twenty years ago (1990) shows that, in 2010, the 35-39 age group replaced the 30-34 age group to form the bottom of the M-shaped curve. The participation rate rose by 16.1 percentage points in the 30-34 age group and by 3.6 percentage points in the 35-39 age group, resulting in a noticeable change in the bottom of the curve: it has become flatter and more gradual.
The number of employed persons in Japan had declined continuously since 1998, but it began to rise in 2004 and continued rising for four years in a row. However, a downward trend set in once again in 2008, which led to a decrease of 260,000 in 2010, from 62.82 million (56.9 percent of the population aged 15 years and over) in the previous year to 62.56 million (56.6 percent).
In 2010, the primary industry accounted for 4.1 percent of employment; the secondary industry, 25.0 percent; and the tertiary industry, 70.9 percent.
As the Japan Standard Industrial Classification (JSIC) was revised in 2007, a strict comparison cannot be made between the figures for 2007 and later and those for 2006 and before. Nevertheless, there was an obvious decline in the number of employed persons in the secondary industry, particularly in manufacturing. The decline continued for thirteen consecutive years from 1993 to 2005. The figure turned upward in 2006, but has been declining again since 2008.
In the tertiary industry, employment increased from the previous year by 320,000 in the "medical, health care and welfare" sector and by 70,000 in the sector of "accommodations, eating and drinking services." Meanwhile, employment in "services, not elsewhere classified" and "compound services" decreased by 80,000 and 70,000, respectively.
Depending on the industrial sector, a difference was seen in the employment tendency between men and women. The percentage of female employment was highest in "medical, health care and welfare" (75.8 percent), followed by "accommodations, eating and drinking services" (60.5 percent) and "living-related and personal services and amusement services" (59.4 percent).
In terms of occupation, employment in the "craftsmen and manufacturing and construction workers" category declined for seven consecutive years since 1998, due to the overseas relocation of production sites and increased imports of manufactured goods. The figure once reversed to rise in 2005, but then began to fall again in 2008, marking a drop of 280,000 from the previous year in 2010. In contrast, the trend toward a service-oriented economy, the aging population, and improvements to the welfare services have contributed to a steady rise in the number of "protective service and other service workers" such as home-care workers. At the same time, the expansion of the information industry gave a steady boost to the number of "professional and technical workers."
In 2010, women were particularly prominent among "clerical and related workers" (60.5 percent) and "protective service and other service workers" (56.9 percent). On the other hand, the percentage of women was particularly low among "workers in transport and communication" and "managers and officials."
An observation of employment patterns in Japan shows that the ratio of regular staff members has been on a declining trend since the 1980s, while that of non-regular staff members, including part-time workers and agency-dispatched workers, has increased. The latter figure soared in younger age groups from the mid-1990s to the beginning of the 2000s. Although it went down in 2009 due to the deteriorating economy, it started going up again in 2010.
In 2010, there were 51.11 million employees (excluding company executives), of whom 17.55 million, or 34.3 percent, were non-regular staff members. The ratio of non-regular staff members among all male employees was 18.9 percent, while the corresponding ratio for females was 53.8 percent, revealing a large difference between the genders.
A breakdown of non-regular staff members by age group shows that among men, many young and elderly men are employed as non-regular staff members relative to other age groups. Among women, the older the age group is, the greater the non-regular staff ratio is.
Factors behind the rise in non-regular staff members include labor cost-cutting and the trend where seeking work-ready, pre-trained workers was preferred to developing human resources by hiring new graduates. As a result, there was a change in terms of employment patterns in that non-regular staff members increased, particularly among young people.
The employment rate of new graduates had been worsening as a result of the economic slowdown since 2008, but their employment picture improved slightly in 2011.
In 2010 the unemployed numbered 3.34 million persons, recording the first decrease in three years. The unemployment rate was 5.1 percent, the same as from the previous year. The unemployment rate recorded for May 2011 was 4.5 percent (a seasonally adjusted figure; the data for Iwate, Miyagi and Fukushima prefectures were excluded).
The ratio of job offers to job seekers marked 1.08 in July 2006 when it peaked out in recent years. It has been on a falling trend since then, marking 0.61 in May 2011 (a seasonally adjusted figure).
A breakdown by gender shows that the unemployment rate in 2010 was 5.4 percent among men, and 4.6 percent among women. The unemployment rate has been higher among men for thirteen consecutive years since 1998.
The unemployment rate was seen as notably higher in younger age groups than in other age groups, in men and women alike.
Analyzing the total number of unemployed in 2010 (3.34 million people), by reasons for job-seeking, the major reasons were: (i) involuntarily dismissed due to corporate or business circumstances, or reaching retirement age limit, 1.37 million persons; (ii) voluntarily left their jobs for personal or family reasons, 1.04 million persons; (iii) new job seekers due to the necessity to earn income, 0.46 million; and (iv) new job seekers just graduated from schools, 0.16 million.
In terms of the duration of unemployment, most were unemployed for "1 year or more" (1.21 million persons), followed by "less than 3 months" (0.94 million persons). The younger a job seeker is, the shorter the job-seeking period tends to be; on the other hand, the older a person, the longer the job-seeking period tends to be.
In 2010, the monthly average of total hours worked was 146.2 per regular employee (in establishments with five or more regular employees), up 1.4 percent from the previous year, and the first increase in four years. Multiplied by 12, this amounts to an annual average of 1,754 hours.
Of the total monthly hours worked, 136.2 were scheduled working hours, representing an increase of 0.7 percent from the previous year. Non-scheduled work such as overtime work averaged 10.0 hours per month, representing an increase of 9.0 percent. Working days averaged 19.0 days per month in 2010.
In 2010, the monthly average of total cash earnings for regular employees (in establishments with five or more regular employees) was 317,000 yen. This total amount includes 263,000 yen in "contractual cash earnings" (which include "scheduled cash earnings" plus "non-scheduled cash earnings" for working overtime, on holidays and late at night, as well as other allowances), and 54,000 yen in "special cash earnings" (which include summer and year-end bonuses, payments to celebrate employees' marriages, etc.).
Generally, the average earnings (scheduled cash earnings) in Japan go up with age until roughly the 40s to mid-50s are reached and then declines. This reflects one characteristic of Japan's seniority employment system in which salaries are determined mainly on the basis of employment duration. Into the 1990s, an increasing number of enterprises reviewed their salary system, resulting in more widespread introduction of a merit-based pay system placing emphasis on performance. However, there has been a trend in recent years, particularly among large enterprises, to value the practice of long-term employment once again and attach importance to job execution skills.
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