The global economy continues to develop in the midst of trends toward movements to more open and market-oriented economies, and as such, competition and the division labor is progressing rapidly. In line with these developments, Japan is being urged by global trading partners to modify its industrial structure. Additionally, in accordance with higher income levels achieved in Japan, a strong tendency towards diversity in terms of individual needs and sense of values is gradually becoming apparent. However, if current economic conditions are examined, no remarkable improvements in business activity or employment conditions after the recession of the early 90's is evident while recent downward economic pressure from devastating deflation effects continue, giving rise to employment as a major topic of discussion. Accordingly, up to this point, various systems which have supported development of the Japanese economy have continually been raised for review and, with respect to labor issues, further active debates regarding good methods of work, employment and compensation are in the process of being opened and extended.
At RIALS, in order to clarify conditions for a "new work style" that is based on fact, the "New Working Style Committee" was initiated in January 1994. Here, "new work style" incorporates the scenario in which workers are, for their own interests, able to freely express desires to the company with respect to personal careers and particular areas of work. Furthermore, a system with a high degree of realization of personal hopes and desires regarding individual career paths, as actual career path reflects, to a high degree, personal career aspirations. In other words, the committee defines the new working style as a system in which a high degree of freedom exists for the individual as to personal job and career choices. This committee, with this in outlook, and with the assistance of RENGO affiliates trade unions, distributed a systematic questionnaire regarding to employees' career establishment. the questionnaire covered issues surrounding recruiting, company changes, placement, job rotation, and temporary and permanent transfers. Questionnaires were distributed to trade unions, corporate officials, as well as to employees.
The following is a summary of the report based on the survey and discussions of the above committee.
I. Recruiting and Job Changes
A wider range of employment choices and career aims for individuals
1. During the recruiting process, to what degree are personal ability and career aims of individuals properly considered by the company? From the data a common complaint among new hires is evident, namely that as job seekers they did not receive adequate information on or a thoroughly satisfying explanation of the following item during the recruiting process:
a system for wage increases, career path and the promotional system, and job rank upon entering the company .
2. Under current recruiting practices in Japan, recruiting for specific job categories, specific job courses, specific enterprise locations, as well as year-round recruiting and placement, is not widespread, and it is in fact extremely rare that an enterprise attempt to hire for specific position vacancies consistently throughout a year. It follows then, that choices remain very limited for potential employees as to office location, job category and course, as well as the time of year when it is possible to gain employment at a given company.
3. Finally, when mid-career job changes do occur, whether or not the candidate's knowledge and skill set are properly evaluated by the recruiting company is of the essence in the external labor market. However, the question as to the degree to which skills and abilities acquired at a previous firm are important and directly transferable to the position in the new firm, over half of the respondents replied that experience and skills gained at the previous company were only slightly related to new duties. Furthermore, among all respondents, those over 55 years of age who responded as such climbed to nearly 80% .
II. Placement and Job Rotation
A Minority of Generalists; A Majority of Specialists--From Unilateral Company Control to "Bilateral Agreements"
1. Concerning the prospects for establishing a career path in one company, our survey results show that the percentage of employees who spend the bulk of their time in one job category at their present company is indeed significant. Moreover, considering employees inside single job categories, it is evident that over 50% have developed extraordinarily specialized skills in one particular function in that category. Thus, it becomes clear that the ideal way to establish a career in a company is not to switch between job categories, but rather to experience various job responsibilities inside a particular job category and to refine a narrow range of particular skills in one job function within that category. If we define, then, a generalist as a talented professional who has acquired a great deal of experience in several job categories, very few actually exist and as such, the overwhelming majority of employees remain specialists in their field.
2. A considerable number of workers feel that original job placement upon entering the enterprise as well as company and human resource department recommendations were important factors determining the longest stay in one job category. Regarding initial placement, many times the decision by company officials occurs without taking into consideration the wishes of the employee. Furthermore, although employees generally enjoy the opportunity to present their job transfer demands to management after a few years at the company, in reality these hopes rarely reach fruition. It is clear, then, that initial job placement (under the discretion of management) and the category of work in the initial placement are principal factors in career determination. The question remains, however, whether this type of career establishment is satisfying to individual employees. In fact, a large number of employees indicated a preference for a wider range of job experiences rather than becoming a specialist in one job category at the company's behest. Indeed, strong evidence from our survey illustrates the desire of employees to extend the range of their job experiences to a much larger degree than has occurred in the past.
3. Under the assumption that all employees hold an equal degree of latent ability and put forth the same degree of personal effort, differences amongst employees as to the degree to which one is able to fully demonstrate the extent of one's ability is dependent mainly upon the office in which one works and conditions thereof. According to the question whether an employee is able to recognize coworkers with varying lengths of service with the company who may be working in an environment where they cannot fully demonstrate their ability and know-how, approximately 20% responded that there were "some" while "a few" formed a plurality of all answers and climbed to 55% . In addition, when employees were asked their general level of career and job satisfaction on various points, satisfaction with a supervisor's direction and leadership was relatively low compared with related items in that category as those who expressed some kind of dissatisfaction with their supervisor's leadership and direction exceeded 60%. This therefore clarifies the fact that bilateral agreements in the workplace, rather than unilateral company decisions, are necessary to facilitate employee satisfaction at the enterprise.
Furthermore, as employees are generally limited to one job category while the career path inside that category is largely undefined or vague, clear discussion between union and management will not only increase job satisfaction, but will also facilitate increased ability for each employee in each job category.
III. Temporary and Permanent Transfers
Information on transfer conditions is limited to oral explanations - more clarity is required
1. Many companies are expected to increase the number of both permanent and temporary transfers in order to deal with their surplus workers and their aging work force amidst the current change in industry structure and general progress in restructuring efforts. As for the destination of temporary transferees, at this time approximately 90% of companies send personnel to one of three types of companies: direct subsidiaries, related companies with capital affiliation, and related companies with no capital affiliation. However, over half of the companies reported a need to explore destinations other then the aforementioned. This tendency is quite noticeable in the manufacturing, finance, insurance, and real estate sectors, which have been particularly affected by the current recession as well as the highly valued yen and hollowing-out effects.
2. It is very clear from the data that oral explanations from the company regarding conditions of transfer remain insufficient. Information pertaining to length of time of the transfer, details of the company to which one will transfer, job content, title of the new post, rank in the company, and salary explanations remain extremely vague to transferees .
Quite a large number of companies report that in the first place their is no standard or rule, especially for managers, regarding length and conditions of transfer and moreover, that oral explanations of these conditions are the norm. As for union employees, except for working conditions and salary, explanations of the details of transfer are also generally relayed only orally.
According to research on permanent transfers conducted by the union, although rules for salary determination and other working conditions are in place, companies which have standard systems and rules for handling issues such as selection of suitable employees for transfer, job security after the transfer, preparation time prior to transfer, appropriate training, pension considerations, and housing are indeed rather rare. Also, even though employees are not faced with layoff in the event of their temporary or permanent transfer, the transfer is necessarily accompanied by various changes in job responsibilities and environment which gives rise to the need for the establishment of standard rules for appropriate training along with a clear explanation of transfer conditions well in advance of the departure date.
IV. Career Paths and Total Compensation, Salary, and Employment Conditions
1. Image of Career Paths
A new career path "image" is shown as the following:
During the first ten years of a worker's career, he/she is subject to typical Japanese-style personnel management in which the seniority-based management of job rotation and promotion (hereafter referred to as the "seniority system"), under centralized control of the corporate human resources department, is highly respected and through which, annual salary increases are firmly maintained, thus preserving the beneficial elements of the Japanese system such as the establishment of a wide range of experts and corporate latitude in selecting from a large labor pool employees whose skills and abilities match a particular job. However, after a worker reaches his/her 30's, corporations prepare and provide the following three job course "menus" from which the worker is able to choose.
Menu 1--"the low risk-low return" case: The low risk-low return scenario maintains typical Japanese-style control elements which dominate the first ten years employment at the company such as the seniority system, the regular salary increase system, and long-term employment stability. The greatest merit of this scenario to the employee is long-term employment stability (i.e. low risk) although returns (e.g. salary increases, major promotions) are low, as they are measured.
Menu 2-"the moderate risk-moderate return" case: The points of comparison are similar to those in the low risk case and as such, risks and returns differ only by degree. In other words, while long term employment is generally ensured, exceptions to this rule occasionally do occur.
Menu 3-"the high risk-high return" case: This case is, literally, "the path to manager" or "the manager course" and as such, annual salary (*which is fixed) rises considerably after the first ten years of employment on the "manager track", but after which annual salary increases are dependent upon performance. If things go well, the employee may reach eminence by attaining an executive position. On the other hand, those in the "managerial track" can expect salary reductions if performance is less than adequate by company standards or in the case of complete failure, termination may occur as job security is not guaranteed.
* (Note: Generally, after reaching manager level, annual salary is fixed regardless of the number of hours worked. Before becoming a manager (even white collar employees) pay is based on salary and overtime work (i.e. overtime is usually paid).
2. Merits for Employees and Trade Unions
Firstly, the career path model was designed to correspond to the diversity of employment and employee attitudes toward compensation, salary, and career path as well as to expand possibilities for employees with respect to methods for choosing individual careers and jobs, employment conditions, and methods of work. Secondly, the scope of union activity covers employees represented by the shaded portions in the figures, namely all employees below the age of "30 +X" (as shown in figure 9) as well as those above the age of "30 +X" in the low risk-low return and moderate risk-moderate return groups. Next, in the low return case, salary increases are based mainly on seniority and as such, base pay increases regularly while in contrast, under the moderate return scenario, ability and performance are weighted relatively heavily in salary increase determination, thereby allowing the possibility in which an employee receives no annual pay increase. Finally, the model suggests that the preferred path in terms of job security is membership in the low risk-low return group, which is in fact occupied mainly by technicians and manual laborers. Long term job security is important for this group as skill must be developed and specialized techniques must be transferred to others while maintaining typical "Japanese groupism" in the workplace-leading eventually to increased morale among employees. As for the moderate risk-moderate return group, long term employment is generally secure although flows of workers to temporary and/or permanent transfers or job changes is inevitable. For high risk-high return members, employment is not secured and as such, this group containing manager candidates or managers or executives themselves should be considered first when issues of labor movement are discussed or enacted. To these ends it is then desirable to prepare "menus" regarding working conditions, including working hours and work locations, as well as for individual employees to choose work methods according to the menu.
V. Future Issues Facing Trade Unions and the "New Method of Working"
Toward more active labor management consultations and regulations
As individual control at the firm expands and career diversity progresses, decisions on specific topics within the scope of discussion of career management (In Japan, this means management of job rotation and promotion) are reached through negotiation and consequent adjustments between individual employees and the company. However, as discussion regarding new systems or new rules for negotiation and adjustment cannot be carried out well between an individual employee and the firm, negotiation and adjustment between corporations and employee expands the importance of mechanisms such as collective bargaining and consultations.
In that sense, regarding important topics such as recruiting, job changes, placement, job rotation, promotion, and temporary and permanent transfers, which employees experience at every stage of their career, effort between unions and enterprises towards establishment of reasonable rules must be made. Furthermore, realization of the "new method of working" must be taken as a fundamental premise. To secure the effectiveness of collective bargaining and to plan the activation of consultation between unions and enterprises, it is imperative that corporations be aware of the detailed needs of rank and file union members and plan to meet these needs though the practical negotiation and consultation route without discussing only issues regarding "standard" or "average" cases, i.e. a system must be put in place which meets individual needs--this is accomplished through research on individual desires and needs.