Putting workers and even the nation's economy in harm's way
Major Japanese electronics makers now have their restructuring plans
ready to be implemented through massive job cuts. Akahata of August 31
analyzed these corporate strategies.
Those major electronics manufacturers have announced their restructuring
plans not because they are at the verge of business failure or because they
are in a slump. They are all high-tech blue-chip companies which have led
the so-called "IT revolution."
Fujitsu Ltd., touting the IT industry as a sector that shows the most
promise, has actively carried out restructuring.
How self-seeking it is for large corporations to pursue their "growth" at
the cost of the workers!
The reason these companies have given for their restructuring is the
recent slump in their computer-chip business. But the slump was caused by
over-investment in IT business, for which the management is to blame. The
downturn was triggered by the burst of the "IT bubble" in the United States
and the drop in consumption of personal computers and mobile phones.
Japanese work 500 hours longer than Germans
Corporate executives often cite "redundancy" as a major cause of the
problem, saying: "We cannot afford to keep redundant workers." In the
current economic recession, major electronics manufacturers have already cut
a large umber of jobs.
In the workplace, a smaller workforce is compelled to work longer hours.
Members of the Japanese Electrical Electronic & Information Union
(Denki-rengo) on the average work 2,129 hours a year. Unpaid overtime work
is prevalent. Japanese electronics workers are forced to work 500 hours
longer than their German counterparts.
Huge internal reserve of profits
Major electronic companies have always made hefty profits through
restructuring by using an economic recession as the pretext. They have thus
accumulated huge amounts of profits as internal reserves.
Look at the recent consolidated financial reports of corporate groups.
Hitachi Ltd. keeps more than three trillion yen and Toshiba more than 1.5
trillion yen in internal reserves.
Each corporation is aiming for higher profits. Fujitsu says it is seeking
to establish a corporate setup which can pay even with zero growth. Toshiba
has a goal of making 237 billion yen in profits for the current fiscal year
ending in March 2002. To achieve these goals, their restructuring plans
include abandonment of subcontractors as well as the workers.
Expanded production abroad
Japan's electronic makers' strategy is also focusing on increasing
production abroad. The Yomiuri Shimbun of August 28 quoted Okamura Tadashi,
Toshiba president, as saying: "As we move more production abroad in order to
cut costs and increase our competitiveness, our domestic production will
have to be reduced."
The total number of employees abroad of Japanese electronics companies is
over three million, which accounts for more than 50 percent of those
companies' employees. Obviously, expansion of production abroad will hit
hard subcontractors and local economies in Japan and result in Japan's
Even business leaders criticize corporations for relinquishing their social
"After us the deluge" explains all that the large corporations are doing
in quest for profits, relinquishing their social responsibility. Even some
government officials and business leaders are criticizing large corporations
for their irresponsibility.
Finance Minister Shiokawa Masajuro at a news conference on August 28
warned the major electronics companies, saying, "Corporate ethics are
declining. Corporations have a social responsibility to help maintain
stability of the people's living conditions."
Okuda Hiroshi, Japan Federation of Employers' Associations president at a
top executive seminar in August 2000 said, "Top corporate management does
not deserve to be called 'management' if it does not care for the well-being
of their employees or try to fulfill their social responsibility or does not
contribute to the overall economic and national interests.
Corporate restructuring which puts corporate profit above everything else
will only hold down workers' earnings and discourage people from spending
The Nihon Keizai business daily reported on August 29 that the
corporations saved more than four trillion yen last year in their lowered
payment of wages.
Massive corporate restructuring in the downturn of the economy will only
contribute to increasing the already serious unemployment rate, which has
reached a five percent level. That's absolutely not the way for economic