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An insurance company employee performs telework while taking care of her son and daughter at home during temporary closure of school due to the spread of COVID-19 infection in Tokyo on 4 March 2020. (Photo: Reuters/The Yomiuri Shimbun)

Authors: Machiko Osawa, Japan Women’s University and Jeff Kingston, Temple University

Telework is not a panacea for what ails the Japanese economy, but there are signs that the COVID-19 pandemic has shaken up corporate Japan as it sheds the hallowed hanko (personal seal used in lieu of signatures), leaves behind the fax and embraces remote work. But telework is also accentuating digital divides between larger and smaller firms, regular and non-regular workers, men and women, and urban and rural areas.

A March 2022 government report that draws on a survey of 40,000 workers provides the most comprehensive data on telework in Japan. According to this report, the overall rate of telework increased from 13.3 per cent of employees in 2016 to 27.3 per cent in 2021. In Tokyo alone rates surged from 16.9 per cent in 2016 to 42.1 per cent by 2021. At large firms of over 1000 employees, 40.1 per cent of workers engaged in telework compared to 19.2 per cent in 2016. For workers at smaller firms with 300–999 employees, the rate rose from 14.7 per cent to 29.1 per cent.

These are massive shifts in the employment paradigm in just five years.

Although survey methods and definitions vary, levels of telework in the OECD are mostly higher than in Japan. Australia, France and the United Kingdom reported a peak telework rate of 47 per cent, marginally higher than Tokyo. In Italy and Brazil less than 20 per cent of the workforce was working remotely as of 2021. Cross-nationally, industries involving physical production like health and social services, construction, transport and hospitality tend to have lower rates of telework, while higher rates are observed in digitalised sectors such as information and communication, financial and professional services.

Remote work is rippling across corporate Japan and …continue reading

    

Passengers seen inside a Meguro Line subway train during the rush hours. (Photo: Reuters/Stanislav Kogiku)

Author: Hiroshi Ono, Hitotsubashi University

Working in Japan is full of inflexibilities. Flexible work arrangements, such as remote work and flexible work hours, remain low compared to other OECD countries. Digitalisation has been slow to launch and, even controlling for the state of Japan’s digital infrastructure, flexible work arrangements remain low. The problem is not just because of the poor state of digitalisation, but the ingrained work culture.

The Prime Minister’s Office launched the Work Style Reform Action Plan in 2016, which helped build momentum towards creating a more flexible work culture, promoting work–life balance and improving overall productivity in the workplace. The number of employers offering flexible work practices, such as remote work and flexible work, has risen since its launch. But the core aspects of the inflexible work culture remain.

Inflexibility may be rooted in collectivism. Yamagishi and associates argue that the tolerance for ‘free-riders’ is lower in collectivist societies such as Japan. Mechanisms to monitor and sanction behaviours, like micromanagement, are often present in such societies. If the prevailing norm is to work for fixed hours at the office, working flexible hours or working remotely may be viewed as a deviation from the norm. Flexible work disturbs group harmony and signals an inability to conform. If some workers in a particular division can work flexibly but others cannot, the whole division may be forced to forego the flexible work option.

Work culture in Japan is still input-based. A key reason that Japanese workers continue to work long hours at the office is because it is viewed favourably, as an act of hard work and commitment. Input measures, such as work hours and tenure, …continue reading

    

A changing of the yen guard for everything except Japan’s tallest mountain.

For nearly 40 years, people in Japan have been happy when they see Yukichi Fukuzawa’s face. Not necissarily because of any personal affection for the esteemed educator, linguist, and entrepreneur, but because since 1984, Fukuzawa has appeared on the 10,000-yen bill, the highest-value piece of paper currency in Japan.

Fukuzawa’s stint as the poster/bill boy for monetary gains is going to be coming to a close, though. As of this month the Japanese government has stopped printing new Fukuzawa bills. That fate is also shared by the other current “Series E” banknotes, the 5,000-yen bill with author Ichiyo Higuchi and 1,000-yen bill with scientist Hideyo Noguchi.

▼ The Series E bills went into circulation in 2004, which is also when Noguchi and Higuchi made their on-yen debuts.

The current group’s departure makes way for their replacements on the upcoming Series F bills: economist Eiichi Shibusawa (10,000-yen bill), educator Umeko Tsuda (5,000 yen), and scientist Shibasaburo Kitazato (1,000 yen).

▼ Preview images of the new bills include red “sample” (見本) markings

The backs of the bills will be changing too. Currently, they feature the phoenix from the roof of Kyoto’s Byodoin Temple, irises, and Mt. Fuji with sakura cherry blossoms.

The new bills will instead bear illustrations of Tokyo Station circa 1914, wisteria, and a reproduction of ukiyo-e woodblock artist Hokusai’s Great Wave off Kanagawa.

Mt. Fuji is still visible in the horizon in Great Wave off Kanagawa, thus keeping its streak of appearing on …continue reading

    

Japanese couple with umbrellas in the botanic garden, Kansai region, Kyoto, Japan. (Photo: Reuters)

Author: Naohiro Yashiro, Showa Women’s University

The decline and ageing of the Japanese population over the last 20 years have been severe. According to the Japanese National Census, the population aged between 15 to 64 years declined by 11 million, while those aged 65 and above increased by 14 million. The shrinking working-age population is discouraging private investment due to projected pessimistic domestic market growth.

The declining population is a natural consequence of the smaller number of people who can become parents. Due to the declining total fertility rate (TFR), the average number of children per woman dropped from 2.1 in the early 1970s to 1.3 in 2021. This is far below the level needed to maintain a sustainable population.

The government is encouraging higher birth rates by increasing benefits for families raising children. But this supporting policy alone is not enough. The Sixteenth Japanese National Fertility Survey, published by the National Institute of Population and Social Security in September 2022, reveals key information about Japanese families.

The fertility rate of married couples declined from 2.2 in 1971 to 1.9 in 2021. As children born to unmarried couples account for just 2 per cent of children in Japan, the primary factor for the falling TFR is the continuously declining marriage ratio. Yet there are few policies in place to reverse this trend.

Low and unstable incomes makes it more difficult for young people to get married and have children. But the survey results show that those who chose not to marry due to economic difficulties are a minority. The main reasons for both men and women are non-economic, such as being unable to meet a suitable person.

The survey indicated that over 80 per cent of single young men and women were willing to marry. As the desire …continue reading

    

Banknotes of Japanese yen are seen in this illustration picture, 22 September 2022 (Photo: Reuters/Florence Lo).

Author: Takeshi Tashiro, Peterson Institute for International Economics

A peculiar characteristic of the Japanese economy is continued low inflation despite the current global inflationary period. Though Japan’s headline inflation rose to 3 per cent in September 2022, it is minor compared to 8 per cent in the United States and 10 per cent in the United Kingdom. The Bank of Japan views the current inflation as temporary and maintains its expansionary monetary policy.

There are questions about why Japan has experienced far lower inflation than the rest of the developed world for so long. Two macroeconomic puzzles haunt Japan — very low exchange rate depreciation pass-through to inflation and weak wage growth.

The first puzzle is that a weaker yen has far less impact on inflation and the economy than macroeconomic analysis predicts. The Bank of Japan kept its policy rate negative while other developed-world central banks raised interest rates to combat inflation, causing the yen to fall by 30 per cent against the US dollar. In September 2022, the yen dropped to a 24-year low, leading the government to intervene to prop up the currency for the first time since 1998.

Currency depreciation should cause inflation by driving up the price of imports. Yet the weakness of the yen in the absence of high inflation demonstrates the low impact of depreciation. In September 2022, the yen-based import price index rose 48 per cent, but the consumer price increased only modestly. Similarly, during other episodes of currency depreciation — such as when Abenomics was in effect — domestic inflation did not rise.

Low wage growth is another puzzle. Despite a 2.6 per cent unemployment rate in September 2022, wages have not kept pace with inflation. Commodity price increases triggered a wage-price spiral in other places. In the …continue reading

    

Australian Prime Minister Anthony Albanese greets Japanese Prime Minister Fumio Kishida in Perth, Australia, 22 October 2022 (Photo: Sharon Smith/Reuters).

Authors: Donald R Rothwell, ANU and Mai Sato, Monash University

Throughout 2022, Australia–Japan military cooperation has been the subject of renewed focus. On 22 October, during Japanese Prime Minister Fumio Kishida’s visit to Perth, the two countries announced several new initiatives, including a renewed bilateral Joint Declaration on Security Cooperation. Both Australian Prime Minister Anthony Albanese and Kishida highlighted the January 2022 Reciprocal Access Agreement (RAA) as symbolic of the growing defence cooperation between Australia and Japan.

The RAA is a treaty-level agreement between Australia and Japan that reflects the outcome of negotiations that started in 2014. A significant stumbling block in those negotiations was Japan’s use of the death penalty and Australia’s opposition to it. That remains an issue for the Albanese government, which inherited the RAA from the Morrison government, and is currently under review by the Australian Parliament’s Joint Standing Committee on Treaties.

The RAA is a form of ‘Status of Forces Agreement’ that allows for the exchange of military forces and an associated civilian component of the visiting force. It seeks to resolve international and domestic legal issues that arise when military forces are exchanged and engaged in ongoing cooperation, such as joint military exercises.

A core aspect of these agreements are the legal mechanisms established for the application of the laws of the visiting forces while in the receiving state, and the application of laws of the receiving state. Immunities enjoyed by visiting forces must be balanced against the need to ensure that the conduct of visiting forces is subject to legal regulation, particularly local criminal laws.

The general approach of the RAA is that visiting forces remain subject to the law of the sending state while within the receiving …continue reading

    

Japanese Prime Minister Fumio Kishida speaks virtually at the opening ceremony of the two-day Tokyo International Conference on African Development, Tunis, Tunisia, 27 August 2022 (Photo: Reuters/Kyodo).

Authors: Brittany Morreale, USAF and Purnendra Jain, NUS

The African continent has emerged as a new geostrategic playground for Asian aid donors. The Forum on China–Africa Cooperation in November 2021 and the Tokyo International Conference on African Development (TICAD) in August 2022 marked the eighth occurrence of China and Japan’s respective high-level African conferences.

At the geostrategic level, Japan and China’s investments in Africa offer insight into the shifting balance of power toward Asia in the 21st century. But a deeper analysis reveals the uniqueness of the TICAD process and Japan’s partnerships with African states. Japan’s core development principles of ownership, partnership and human security set its African development partnerships apart.

As the curtain fell on TICAD 8, held in Tunisia in August 2022, Japan’s deepening commitment to African states stood out against a backdrop of international and domestic turmoil. Japanese Prime Minister Fumio Kishida’s US$30 billion commitment to public–private investment signalled continuity in Japan’s 30-year partnership even as developing nations continue to toil with the most acute socioeconomic impacts of the COVID-19 pandemic and the war in Ukraine.

While the challenges of 2022 take a new form, the Japan–Africa partnership has stood the test of time.

Japan launched the TICAD conference in 1993, marking the first Asia–Africa forum of its kind. Achieving the esteemed status of top global aid donor from 1989 to 2000, Tokyo showcased a new brand of international leadership built around the TICAD model. TICAD elevated Japan’s unique development philosophy and served as a paradigm for emerging Asian powers — most notably China, India and South Korea — to engage with African states.

In 2022, the Japan–Africa partnership exists within an increasingly crowded and contested ecosystem of development agendas. Alongside China’s Belt and Road Initiative, India’s …continue reading

    

Employees work on the semiconductor chip production line of Jiangsu Azure Corp in Huaian, Jiangsu province, China, 25 March 2022 (Photo: Reuters/China Daily).

Author: Editorial Board, ANU

As if the stakes in the ongoing US–China geopolitical competition weren’t high enough already, on 7 October the United States banned the transfer of key microchip technologies to Chinese entities.

With the chip ban the United States has signalled — despite the Biden administration’s denials — that it is committed to a strategy of containment not only in military, but now also in economic terms. This begins with thwarting China’s ambitions to dominate the development and production of high-end computing chips that will be central to strategically important industries like AI.

The chip ban may well achieve its intended effects in the short run: China’s chip manufacturing industry is still very dependent on US-developed hardware and software, and the local chip industry is in crisis as firms are cut off from key materials and personnel.

The longer-term effects of the policy are much less certain. China will continue to specialise where it can. Cutting China off from US technology gives Beijing extra incentive to keep throwing money at its own chip R&D, with a view to building an isolated tech supply chain that is even more geared towards state — and especially military — goals. What’s certain is that the chip ban will be disruptive far beyond the semiconductor industry, as global tech supply chains come to be driven less by the economics of comparative advantage than by the geopolitics of the world’s two biggest economies.

US National Security Advisor Jake Sullivan has described these strategies as surrounding a small yard with a high fence. Extraterritorial unilateral sanctions that hurt American tech firms, allies and partner economies are locking others into a larger American yard that may not look so attractive.

In tech just as in other industries, it’s pointless to try and build supply chains delinked from China — most of …continue reading

    

Girls Chintai wants to help customers make the right chintai choice.

There’s a company in Tokyo called Girls Chintai. Chintai means “rental” in Japanese, so you might think that Girls Chintai is an escort service, but chintai here is referring to apartments, and Girls Chintai is a real estate agency.

So why “Girls?” Because…

#ルームツアー #roomtour #内見 #内見動画 #物件紹介 pic.twitter.com/cn63eQenBV

— girls賃貸|デート感覚で理想のお部屋探しを叶える (@GirlsRealestate) October 20, 2022

Girls Chintai’s staff is made up of fashionable young ladies, who accompany clients on their visits to apartments they’re thinking about renting while creating a “date-like atmosphere.”

▼ Riri Sakino, one of Girls Chintai’s agents

The company’s website asks:

Have you ever had these kinds of problems?
● “I wish the person showing me apartments were a beautiful woman.”
● “On my day off, I want to look for an apartment, but I also want to go on a date.”
● “I don’t know what sort of apartment women want a guy to have.”

In keeping with that third point, Girls Chintai seems to focus on smaller apartments, of the size a working adult might be living alone in, but also having a romantic partner come over, and possibly spend the night, if and when he finds one. However, the company says that it welcomes both male and female customers.

▼ Some of Girls Chintai’s recent videos have a Halloween cosplay theme.

pic.twitter.com/Exy0pQInB6

— girls賃貸|デート感覚で理想のお部屋探しを叶える (@GirlsRealestate) October 25, 2022

In Japan, it’s common in Japan to have a real estate agent guiding you around on apartment tours. Japanese landlords generally don’t handle leasing themselves, and instead register their property with one or more agencies. So when you’re looking …continue reading

    

Passersby walk on the street at Shibuya shopping and amusement district, Tokyo, Japan, 28 July 2022 (Photo: Reuters/Issei Kato).

Author: Noriko Tsuya, Keio University

After hovering around zero growth in the late 2000s, Japan’s population has been shrinking since 2010, with the decline accelerating in recent years. Breaking its own record every year for the last 10 years, the country experienced another record population loss of 644,000 in 2020–2021. The population is projected to shrink well into the middle of this century, dropping to an estimated 88 million in 2065 — a 30 per cent decline in 45 years.

Japan’s rapid population shrinkage is primarily caused by persistently low fertility. Japan’s fertility rate has been declining since the mid-1970s, reaching a total fertility rate (TFR) of around 1.3 children per woman in the early 2000s. Japan’s TFR hit a low of 1.26 in 2005, but there was a modest recovery to a TFR of around 1.4 in the 2010s.

There is little out-of-wedlock childbearing in Japan. Childbirths outside of marriage have constituted around 2 per cent of all births since the 1950s. The decline in Japan’s fertility rate is mainly due to fewer young women getting married.

While the proportion of never-married women at their peak reproductive age of 25‒34 had been stable until the mid-1970s, the proportion of single women aged 25–29 jumped from 21 per cent in 1975 to 66 per cent in 2020. The corresponding proportion of women aged 30–34 saw an even more dramatic jump from 8 per cent to 39 per cent.

Young Japanese women are increasingly reluctant to marry and have children in part due to the rapid improvement of their economic opportunities. Women’s participation in four-year college degrees began to rise rapidly in the late-1980s and reached 51 per cent in 2020. The employment rate of young …continue reading