It has been suggested that the Asian economic crisis of the
late 1990s placed a strong pressure to change on the traditions and institutions
of East Asian countries. This ‘East Asian model of Capitalism’, which
emphasizes government intervention and long term relationships instead of
markets, has come to be regarded as a problem rather than a strength in the
modern globalized environment. Whilst this crisis certainly forced employment
relations in some East Asian countries to change drastically, the impact that
this disaster had on Japanese ER is much more divisive and ambiguous.
The main argument advocating that the Asian economic crisis
had a significant impact on Japanese employment relations is presented in
Bamber, Lansbury and Wailes’ 2011 book ‘International
and Comparative Employment Relations: Globalization and Change’. This
argument essentially suggests that several marked changes have occurred in the
Japanese employment system since this crisis and two specific examples include:
- Firms have experienced surplus labour that has restricted the recruitment of career employment to the strict minimum. Resultantly, young regular employees are often overworked with little paid leave.
- A growth in atypical employment and the subsequent erosion of long term career employment is evident.
However, there is also the opposing argument of Jung and
Cheon that is presented in their 2006 journal article entitled ‘Economic Crisis and Changes in Employment
Relations in Japan and Korea’ which suggests that the traditional traits of
East Asian (and specifically Japanese) employment relations are being
maintained and are not being significantly impacted. Whilst these authors
concede that issues such as long-term employment and seniority based pay are
changing to an extent due to strong pressures from globalisation and the economic
crisis of the 1990s, it is incorrect to suggest that the traditional components
of Japanese employment relations are changing drastically. Furthermore these
authors suggest that the Japanese employment relations model is not replicating
Western models such as the system implemented in the United States and that ER
changes are dependent on national context.
What are your thoughts on the impact of the Asian Economic Crisis of
the 1990s on the Japanese Employment Relations System? Has this crisis resulted
in significant changes or have the traditional components of the Japanese
system been maintained?
References-
- Bamber, GJ, Lansbury, RD & Wailes, N (2011) (Eds), International and comparative employment relations: globalisation and change, Allen & Unwin, Sydney. Chapter 10 and 11.
- Jung, E (2010), ‘Employment relations in Japan and Korea’ in Research Handbook of Comparative Employment Relations, Eds M Barry & A Wilkinson, Edward Elgar, Cheltenham, pp. 239-259 (unit reader).
- Jung, E & Cheon, B (2006), ‘Economic Crisis and Changes in Employment Relations in Japan and Korea’, Journal of Asian Survey, vol. 46, no. 3, pp. 457-476.
Really interesting contrast of the two authors opinions of ER in East Asia, after reading Jung's (2011) article he does claim that Japanese was less effected than Korea after the Asian Economic Crisis. He says that this is due to Japan's stability and different approach to ER and industrial relations as opposed to Korea who were in the development stage and had quite a confrontational approach to disputes and ER issues.
ReplyDeleteI feel like Japan is rebuilding thier employment relations systems and that lifetime employment and seniority pay are becoming innapropriate, which are the underlying pillars of thier ER model and culture. Lifetime employment however is still being maintained but seniorities effect on pay is becoming obsolete. In the end Japan are planning to remain separate from a Westernised ER model (Nakamura 2007 & Miyamoto 2009).