A new middle class is rising in Japan. As demographic destiny forces a rise in both the quantity and quality of jobs created, Japan is poised to succeed where most other advanced economies will fail: the next generation of Japanese will be better off than their parents. Japan's proud corporate culture will evolve to embrace both, the traditional focus on 'Kaizen' incrementalism as well as the disruptive innovation demanded by investors seeking to fund high-risk, high-return ideas & projects.
thank you for your note -- for starters I tremendously enjoyed "Japan 1941" by Eri Hotta ; "Embracing Defeat" by John Dower clearly sets the stage ; "How the conservatives rule Japan" by Nathaniel Thayer a classic must-read ; and always full of insights Nakae Chosen"s "a discourse by three drunkards on government" ; let me know your recommendations ; many cheers ;-j
What you are assuming is that an increase in vacancies equals a rise in wages. That is not happening due to a number of factors, but it's mostly cultural, and unlikely to change. The Japanese economy is wholly uncompetitive for global talent. The systemic problem is: Low wages, a government policy of 25 year lows in the yen, high taxes, a requirement for most employers to locate staff in Tokyo (last week named the 5th most expensive city in the world), a requirement for Japanese language skills, and a corporate system that rewards tenure and not talent. Japan's future is at best a near-shore factory for talent for 1st world economies in Asia and ANZ. Japan is a 2nd world economy now and rapidly on its way to the status of the Philippines or Thailand.
Thanks for the insights Jesper. I was curious, the “full-time” folks you wrote about, does that include both permanent and full-time contract based employees? I would like to distribute to my colleagues, potentially also on my Linkedin with a link to your newsletter, if that is fine.
thank you for your note -- for starters I tremendously enjoyed "Japan 1941" by Eri Hotta ; "Embracing Defeat" by John Dower clearly sets the stage ; "How the conservatives rule Japan" by Nathaniel Thayer a classic must-read ; and always full of insights Nakae Chosen"s "a discourse by three drunkards on government" ; let me know your recommendations ; many cheers ;-j
What are your thoughts on the IMF's note on Structural Barriers to Wage Income Growth in Japan (https://www.imf.org/en/Publications/selected-issues-papers/Issues/2023/05/18/Structural-Barriers-to-Wage-Income-Growth-in-Japan-Japan-533515)? They argue that an additional boost to labour participation and incomes is constrained by the tax structure and disincentives for spouses to work beyond certain thresholds due to the income on both taxation and social benefits?
Do you recommend any books on Japan's elites / government?
What is your viewpoint regarding how Japan could tap its large segment of under-utilized (at the workplace) potential workers, women?
What you are assuming is that an increase in vacancies equals a rise in wages. That is not happening due to a number of factors, but it's mostly cultural, and unlikely to change. The Japanese economy is wholly uncompetitive for global talent. The systemic problem is: Low wages, a government policy of 25 year lows in the yen, high taxes, a requirement for most employers to locate staff in Tokyo (last week named the 5th most expensive city in the world), a requirement for Japanese language skills, and a corporate system that rewards tenure and not talent. Japan's future is at best a near-shore factory for talent for 1st world economies in Asia and ANZ. Japan is a 2nd world economy now and rapidly on its way to the status of the Philippines or Thailand.
Thanks for the insights Jesper. I was curious, the “full-time” folks you wrote about, does that include both permanent and full-time contract based employees? I would like to distribute to my colleagues, potentially also on my Linkedin with a link to your newsletter, if that is fine.
Great article! Agreed, labor is key and is improving nicely!