Recession breaks Japan's social contract Employers renege on student job offers


TOKYO -- For most of this century, millions of Japanese parents have devoted their lives to pushing children toward a single practically sacred goal: university graduation and the lifetime job it assured.

But this month, in yet another manifestation of the Japanese recession's impact on long-held standards and expectations, the arrangement is coming undone in places:

Financially strapped companies are reneging on job offers their recruiters made only a few months ago to students nearing graduation.

The news has reached the public piecemeal. No one yet knows how many graduating seniors will be affected.

But a national state of shock seems to be setting in as the mounting instances force a numbing realization: After decades of families' scrimping to pay for cram schools, tutors and private high schools, the brass ring is being jerked away from their children just as they seemed to have it in their grasp.

In important ways, the development strikes more deeply than the recent spate of companies acknowledging imminent reductions in their work forces.

"This really breaks the most fundamental clauses of postwar Japan's social contract," said Scott Foster, a senior research analyst for Merrill Lynch who has spent more than a decade in Japan.

"For Japanese, this is much more shocking than the companies that are trying to force out a handful of older managers," he added.

"Those older guys had their chance for 20 or 25 years, and they weren't getting the job done.

"The Japanese system puts a huge burden on families to get their kids ready to serve the employer, and this totally breaks faith with parents who accepted the burden and with students who met all the requirements."

Japan's highly structured recruiting and job-seeking season for this month's graduates ended last fall, Mr. Foster pointed out.

"Now nobody's hiring until next year, and these kids are marked for life as the ones who got the rug yanked," he said.

By yesterday, television newscasts and newspaper front pages were well beyond the point of treating it as a series of isolated instances.

"If there is anything we have been asked to believe in, it is the connection between education and success," one grim-faced television newscaster said last night. "Now, some companies are destroying that belief."

Companies that renege on job offers could destroy the incentive that keeps parents striving, and with it the education system that produces Japan's world-beating math and science test scores, he said, echoing comments in newspapers and magazines.

If that happened, Japan's ability to compete in international trade would be jeopardized, he said.

Japanese parents' commitment to getting daughters and sons into colleges -- with the corporate job as the ultimate goal -- has been the subject of books and television documentaries in the United States and elsewhere for years.

A typical Japanese junior high student rushes home from school and, several times a week, changes clothes, gulps a meal or snack and then rushes off to cram school.

Sunday morning subway trains are used mainly by children going to and from cram school.

Many argue that, for better or for worse, the real key to the country's spectacular test scores is not its regular schools but this multibillion-dollar-a-year system of private cram schools, which parents use to give their children an edge on admission tests at every step from elementary school to college.

Ironically, the issue of reneging on job pledges first surfaced late in January when Eastman Kodak (Japan), Ltd., a subsidiary of the U.S. photographic film company, withdrew job offers to eight seniors.

Kodak coupled its announcement with an apology, but the news drew widespread criticism.

Japanese commentators accused the foreign firm of failing to understand the country's sense of morality.

Several articles warned that Kodak would never again be able to hire self-respecting Japanese graduates.

Then, a few cases at a time, it became clear that scores of mid-sized Japanese companies had been very quietly doing the same thing well before Kodak made its announcement.

By last week, a survey by private universities and junior colleges in the Tokyo region found that 55 companies had told at least 81 students that their job offers were canceled.

Outraged university officials took a step rarely seen in Japan. They published the names of 14 of the companies.

This week, the Labor Ministry said that a preliminary survey found that at least 14 firms had revoked oral promises to 211 high school and college graduates by Feb. 26.

That rushed survey covered 10 of Japan's 47 prefectures. Officials who made it public said they were sure that a more thorough study would uncover much higher numbers.

On Wednesday, the rising public outcries forced the ministry to assign a task force to try to figure out how widespread the practice is becoming.

The ministry also handed the task force a draft of a regulation that would require companies to report to the government any time they cancel a job offer, cancel recruitment requisitions on file with high schools or colleges, or reduce the number of employees in their hiring plans.

Under Japan's unique recruiting system, companies maintain formal and informal relationships with schools and universities to assure a steady supply of able graduates.

That has been useful to the companies in a labor market in which the problem usually has been a shortage of workers, not of jobs.

Companies announce their recruiting targets as far as a year in advance.

This year, with corporate profits fading and some firms facing debilitating losses, most companies are announcing sharply reduced hiring quotas for next year.

Recruiting takes place mainly at the end of the junior year, with job offers generally made by fall of the senior year.

By April, graduation time, every graduate has known for months where he or she will start work in May.

Companies take on new employees in annual "classes," put them through additional months of in-house training, and count on the bonds that form among newly arriving classmates as a cornerstone of the Japanese employee's legendary loyalty to the corporation.

Copyright © 2019, The Baltimore Sun, a Baltimore Sun Media Group publication | Place an Ad