Abe labor reforms may boost Japan's 'disposable' workers, crimp wages

Wed Dec 18, 2013 4:21pm EST
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By Tetsushi Kajimoto

TOKYO (Reuters) - Yumiko Kajiwara is a cheerful 46-year-old who has had several part-time jobs, including sorting clothes, cosmetics and cellphone parts at a Tokyo warehouse. She also represents a challenge to Prime Minister Shinzo Abe.

Kajiwara is part of a big and growing pool of part-time, temporary and other "non-regular" workers left out of the stability and security of Japan's storied lifetime employment system.

After losing a steady job two decades ago when the small electronics firm she worked for went bust, she says she has "job-hopped from workplace to workplace, having to take jobs as a temp, part-timer or contract worker at best."

"All the while, I've wanted to become a regular employee, but I couldn't afford to choose jobs as daily living takes priority."

Abe, in office a year, has found little traction so far with plans to unclog Japan's sclerotic labor market. But now his government wants to ease rules, which could make it easier for companies to replace regular "salarymen" with temporary contracted workers.

Businesses and many economists say a freer flow of labor - where easier firing allows easier hiring - would make for more robust and durable growth, one of Abe's main goals for the world's third-biggest economy.

But this would also likely accelerate the growth of what some call the "disposable" workforce at the expense of regular salaried workers. That in turn runs directly counter to the main aim of "Abenomics": breaking 15 years of deflation by creating a virtual circle of rising wages, consumer spending and prices.

WAGE SLIP   Continued...

Job seekers listen to presentations by company employees during a job fair held for fresh graduates in Tokyo December 7, 2013. REUTERS/Yuya Shino