Analysis of the Labour Economy

Transcription

1 Analysis of the Labour Economy 21 (White Paper on the Labour Economy 21) -Measures for Labour Productivity and Employment/Labour Issues- [Summary] September 21 Ministry of Health, Labour and Welfare

2 Analysis of the Labour Economy 21 (White Paper on the Labour Economy 21) - Measures for Labour Productivity and Employment/Labour Issues - [Outline]

3 Outline of the Analysis of the Labour Economy 21 Electricity, gas, and water Information and Communication Metals General machinery Chemical Transportation equipment Chemical Finance/ Insurance Finance/ Insurance Electric equipment Metals Information and Communication Other manufacturing Construction Wholesale/ retail trade Electric equipment Electricity, gas, and water Transport/ warehousing Transportation equipment Eating and drinking services, accommodations General machinery Wholesale/ retail trade Construction Other manufacturing Real estate Transport/ warehousing Eating and drinking services, accommodations Real estate The white paper was analyzed under the title Measures for Labour Productivity and Employment/Labour Issues for the purpose of maintaining and enhancing the economic vitality by overcoming the supply limitation, i.e. the shrinking labour force as a result of the decline in birthrate and demographic aging, and by enabling continued increase in wages. Chapter 1: Trends and features of the labour economy Employment conditions are steadily improving: the FY21 average unemployment rate was 3.%, the lowest rate in 17 years, and the FY 21 average ratio of active job openings to active job applicants was 1.11, the highest ratio in 23 years. Furthermore, employment of regular workers increased, and the number of workers involuntarily working as non-regular workers decreased. As a result of the shunto (annual spring wage offensive) of 21, agreed amount and the wage increase rate both increased compared to the previous year. In addition, small and medium-sized companies tended to increase wages. Chapter 2: Challenges for the sustainable growth of the Japanese economy In order to sustain a virtuous economic cycle, increase in wages is important for stimulating consumption. For this reason, measures for enhancing labour productivity are indispensable. When compared with the labour productivity levels of European and North American countries, Japan has a comparable growth rate though the level has dropped. When Japan s labour productivity levels by industry are compared with those of the U.S., the levels in Japan are lower mainly in the non-manufacturing industries, possibly due to the considerably smaller information technology (IT) capital investments made in Japan compared to those made in the U.S. Furthermore, while IT investments simultaneously accompany investments in brand equity, organizational structure, and human capital that contribute to growth, it is our challenge that such investments made in Japan are also extremely small. ((Time(s)) Fig. 1 Transition of the unemployment rate and the ratio of active job openings to active job applicants [July 26] 1.8 [July 26] Ratio of active job.6 openings to active job applicants Active job openings-toapplicants ratio for regular employees (July 2). [August 2].2 [November 2].2 [March 21] 1.1 Unemployment rate (right axis) [March 21].71 (March 21) , 6, 6,328 Agreed amount 妥結額 (right axis) ( 右目盛 ) Japan Business Federation (Large-scale 経団連 ( 大手 businesses) ) 6, MHLW 厚生労働省 (Yen) Japanese Trade Union Confederation 連合 (RENGO) 7, ,711, Fig.3 [2-26] Japan s labour productivity level by industry (U.S. = 1).63.3 Fig. 2 Results of wage increase.6.3 Fig. [2 26] Japan s IT capital investment by industry (U.S. = 1) Horizontal axis: Labour input by industry / Vertical axis: Man-hour(s) (Fig. 3 & ) , 7, 6,,, 3, 2, 1,.1 i

4 Employment rate of females of the child-rearing generation Labour productivity (log-transformed value) Labour productivity (log-transformed value) Definitely want to work at a large company A large company is desirable if the work matches my career interests A small or medium-sized company is okay if the work is satisfying Want to work at a small or medium-sized company Extreme fluctuation in work amount / Frequently arising sudden and unforeseen duties Staff shortage Duties that must be performed by working overtime due to the nature of the work or customers circumstances To produce products or results of satisfactory quality Lack of ability and skills Chapter 3: For the realization of more effective work styles In order to encourage labour participation, work styles must be reviewed; e.g. correction of long working hours. Reasons for the occurrence of overtime work given by both employers and workers include fluctuation in the amount of work, staff shortage, and customer service duties. In addition, while many employers responded as overtime being caused by workers lack of ability and skills, many workers responded that they want to produce satisfactory products/results based on their own standards. Various efforts made by companies that worked on reducing overtime work and succeeded in overtime reduction include work condition reality check, alerting, reviewing of details and distribution of duties, and appeals from top executives. Such companies tend to regard themselves as having higher labour productivity in comparison with those of industry peers. (According to the responses given in company interviews, the positive effects of reduction in work hours were fatigue reduction and self-improvement.) Chapter : Desirable state of local economies in the face of population decline Regional economy vitalization is crucial to the economic growth of our country. Private final consumption expenditure contributes significantly to the growth of local economies. Accordingly, we must encourage labour participation by females and seniors, and also improve labour productivity since it is the prerequisite for raising income levels. Regional labour productivity tends to improve when population, businesses, as well as human resources (e.g. people who have received higher education at universities or junior colleges, and people who work on self-development) concentrate in the region. To enhance this human resource group, improvements in the employment situation and attractive employment opportunities are needed. Regional economic growth can be supported through efforts to secure workers in the era of population decline by encouraging females of the child-rearing generation to work; this can be done by providing sufficient day-care center capacity and suppressing long working hours to create an environment that enables the balancing of work and childrearing. Fig. Causes of overtime work (workers and employers) Workers 7 Employers 生か業じら務や のす突繁い発閑か的がらな激業し務いが (Yen / man hour) 8.8 人手不足だから で都仕き合事な上のい 性仕所質事定やが外顧あで客るなのかいらと y =.111x (6.8) (2.73) R² =.7 仕自上分げがた納い得かでらきるまで 能力 技術不足のため Fig. 7 Relationship between human resource concentration and labour productivity (Yen / man hour) Fig. 6 Assessment of labour productivity by companies with and without overtime reduction (in comparison with industry peers) (Number of graduates of higher education institutes/km2) (Number of people who work on self-development/km 2 ) Density of graduates of higher education institutes (log-transformed value) Density of people who work on self-development (log-transformed value) 絶対に大手がよい 63. 企で自業き分がるのよのやいでりあたれいば仕大事手が であやもれりよばがい中い堅の あ中る小仕企事業で Low or Rather low Cannot specify / Do not know 21.6 High or Rather 短を ( 変 high Reduced Not changed 縮含よくわさ (including む分ら Not れ ) clear ) かなたらい (Whether or not overtime was reduced) な Fig.8 Job いexpectations of university students (Class of 21) Fig. Relationship between employment rate of females belonging to the child-rearing generation and day-care center capacity rate / rate of workers working long hours y =.113x (7.136) (11.83) R² =.3 8. 中堅 中小企業がよい y = -2.7x (-8.2) (1.36) R² = Ratio of workers of the child-rearing generation working ii long hours

5 Analysis of the Labour Economy 21 (White Paper on the Labour Economy 21) - Measures for Labour Productivity and Employment/Labour Issues - [Overview]

6 Chapter 1 Trends and features of the labour economy - Trends of employment, unemployment, etc. - Employment conditions are steadily improving: the FY21 average unemployment rate was 3.%, the lowest rate in 17 years, and the FY 21 average ratio of active job openings to active job applicants was 1.11, the highest ratio in 23 years. Furthermore, the active job openings-to-applicants ratio for regular employees reached a record high in December 21 at.71. Employment of regular workers increased, and the number of workers involuntarily working as non-regular workers consecutively decreased for four consecutive quarters. Transition of the unemployment rate and the ratio of active job openings to active job applicants (Time(s)) [July 26] 1.8 [July 26] Ratio of active job.6 openings to active job applicants Active job openings-toapplicants ratio for regular employees (July 2). [August 2].2 Unemployment rate (right axis) [March 21] 1.1 [March 21].71 [December 21].71 (March 21) [November 2] to 3-17 years old -2 Total of to all ages years old Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Source: Prepared based on Report on Employment Service, Ministry of Health, Labour and Welfare (MHLW), Labour Force Survey, Statistics Bureau, Ministry of Internal Affairs and Communications (MIC) (left figure), and Labour Force Survey (detailed tabulation), Statistics Bureau, MIC (right figure). (Year/period) Difference from the same period last year (1, persons) [Male] Non-regular staffs and employees Transition of the number of employees [Female] Non-regular staffs 77 and employees [Male] [Female] Regular staffs and employees Regular staffs and employees Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Ⅱ Ⅲ Ⅳ Ⅰ Difference from the same period last year (1, persons) [Total of male and female] (Year/period) Transition of the number of workers involuntarily 6 years old working as non-regular workers and over -7 1 to 2 years old

7 Chapter 1 Trends and features of the labour economy - Trend of wages - Nominal wages in FY 21 increased for the first time in four years mainly due to the increase in special wages and scheduled wages of full-time workers. As a result of the shunto(annual spring wage offensive), agreed amount and the wage increase rate both increased compared to those of the previous year. In addition, wage increases were observed also in small and medium-sized companies. Hourly wages of part-time workers also increased. Consequently, the wage gap between part-time workers and fulltime workers has narrowed Transition of the total sum of cash earnings Contribution of the special wages of full-time workers Contribution of the non-scheduled wages of full-time workers Contribution of the scheduled wages of full-time workers Contribution of the ratio of part-time workers Percentage change from the previous year of the total sum of cash earnings of all workers Contribution of the total sum of cash earnings of part-time workers (FY) 7, 6, 6,328 Agreed amount 妥結額 (right axis) ( 右目盛 ) Japan Business 経団連 Federation ( 大手 ) (Large-scale businesses) 6, MHLW 厚生労働省 7,367 Japanese Trade Union Confederation 連合 6, (RENGO) Source: Prepared based on Monthly Labour Survey, MHLW (left and lower right figures), Situation of Demands and Conclusions of Negotiations for Wage Increase in Major Private Companies (Springtime), MHLW, Settlement Results of the Labour-Management Negotiations in the Springtime in Large-Scale Businesses (weighted average) (final results), Japan Business Federation, and Results of Final Responses to the Policy for Spring Struggle for a Better Life, Japanese Trade Union Confederation (upper right figure) Results of wage increase, , 7, 6,,, 3, 2, 1, (Hourly wage of full-time workers = 1) (Yen) Transition of the hourly wage of part-time workers 1,8 Ratio of the hourly wage of part-time workers to the 1,7 hourly wage of full-time workers 3 1,6 1, 2 1, 1 1,3 Hourly wage of part-time workers (right axis) 1,2 1,

8 Chapter 2 Challenges for the sustainable growth of the Japanese economy - Wage stagnation in the midst of deflation and the causes (1) - While real wages are increasing in the midst of increasing real labour productivity in the euro area and in the U.S., in Japan, real wages are stagnating in the midst of increasing real labour productivity. (1 = 1) 1 Japan International comparison of real wages and real labour productivity Euro area U.S. (1 = 1) (1 = 1) Real labour productivity per person Real wage per employee Source: Prepared based on OECD.Stat

9 Chapter 2 Challenges for the sustainable growth of the Japanese economy - Wage stagnation in the midst of deflation and the causes (2) - While the proportion of operating income in the added value of companies has been increasing, the proportion of labour cost (labour share) has decreased, especially from 2 through 2; the labour share of large companies has been showing a downward trend. This has been one of the causes of wage stagnation. The worsening of terms of trade caused by the drop in export prices has cancelled out the upward pressure on wages caused by the increase in labour productivity. This has been another cause of wage stagnation Proportions in added value Labour cost 7 6 Labour share of large companies Analysis of factors of real wage increase rate Increase rate of real labour productivity Labour productivity Labour share was increased by the collapse of Lehman Brothers Operating profits Depreciation cost y = -.28x (-3.) (8.7) -1. R² = Labour share Terms of trade Labour share dropped sharply from 2 through 2. The worsening of terms of trade has been putting a continuous downward pressure on wages Source: Prepared based on Financial Statements Statistics of Corporations by Industry (quarterly journal), Ministry of Finance (left and central figures). Estimated based on Monthly Labour Survey, MHLW, Labour Force Survey, MIC, and National Accounts, Cabinet Office (right figure).

10 Chapter 2 Challenges for the sustainable growth of the Japanese economy - Wage stagnation in the midst of deflation and the causes (3) - Increase in non-regular workers such as part-time workers with comparatively lower wages puts downward pressure on the average wage. In light of the fact that almost % of the group of non-regular workers such as part-time workers that joined the workforce in the past 1 years consisted of seniors aged 6 and over and females aged under 6, wages were analyzed by factors of changes in the wages of full-time workers and part-time workers as well as factors of the rise in the ratio of part-time workers by age group. Looking at the average of five years from 21, the rise in the ratio of part-time workers of those social strata accounts for.37% (3.3% of the downward pressure caused by the ratio of part-time workers) of the downward pressure on wages. Analysis of factors of the increase in non-regular workers such as part-time workers (2 21) (Increase in 21 compared to 2, Total 1. Unit: 1, persons) (3.8 million persons) Analysis of factors of wages by age group Male aged 6 and over (1.21 million persons, 3.%) Female aged 6 and over (1.2 million persons, 31.2%) Female aged less than 6 (1.1 million persons, 27.6%) Male aged less than 6 (.3million persons, 1.8%) Male and female aged 6 and over (2.million persons, 61.6%) -. Female aged less than 6 (1.1 million persons, 27.6%) -1. aged 6 and over (female) Source: Prepared based on Labour Force Survey (detailed tabulation), Statistics Bureau, MIC (left figure). Calculated based on Basic Survey on Wage Structure, MHLW (right figure) Total level of contribution of the ratio of part-time workers -.% -.6% (78.%) -.7% (7.%) -.2% -.32% (6.2%) -.37% -.% -.3% (3.3%) Proportion of the level of contribution of persons aged 6 and over and females aged under 6 in the entire ratio of part-time workers Ratio パート比率要因 of part-time 6 workers 歳未満 ( 男 ) パート比率要因 Ratio of part-time 6 workers 歳未満 ( 女 ) パート比率要因 Ratio of part-time 6 workers 歳以上 ( 男 ) aged under 6 (male) aged under 6 (female) aged 6 and over (male) パート比率要因 Ratio of part-time 6 workers 歳以上 ( 女 ) 一般労働者賃金要因 Wages of full-time workers パート賃金要因 Wages of part-time workers

11 Chapter 2 Challenges for the sustainable growth of the Japanese economy - Sustaining a virtuous economic cycle by expanding demand - Until 1, there was a high correlation between compensation of employees (wages/salary) and final consumption expenditure of households which accounts for approximately 6% of the GDP in Japan. However, social benefits such as pension benefits have been underpinning household income since 18. In order to stimulate consumption, it is important that corporate profits are distributed to wages. According to the consumption function estimation results, a 1% increase in scheduled wages increases macro-level personal consumption by.%. On the other hand, a 1% increase in non-scheduled wages or special wages increases macro-level personal consumption only by.% and.13%, respectively. Constant wage increases such as an increase in scheduled wages by a base pay raise have a greater impact on consumption stimulation. (trillion yen) 3 3 Relationship between private consumption and employee compensation & social benefits Final consumption expenditure of households Compensation of employees + social benefits.7.6 Impact of 1% wage increase on macro-level private consumption (elasticity). 2 Social benefits Compensation of employees (wages/salary) 所定内給与 Non-scheduled Scheduled wages 所定外給与 Special 特別給与 wages wages Source: Prepared based on National Accounts, Cabinet Office (left figure). Estimated based on Monthly Labour Survey, MHLW, Labour Force Survey, Statistics Bureau, MIC, and National Accounts, Cabinet Office (right figure). 6

12 Chapter 2 Challenges for the sustainable growth of the Japanese economy - Challenges for improving productivity in Japan (1) - Increase in labour productivity is indispensable for maintaining and enhancing the economic vitality by overcoming the supply limitation, i.e. the shrinking labour force as a result of the decline in birthrate and demographic aging, and for enabling continued increase in wages. When compared with the labour productivity levels of European countries and the U.S., Japan has a comparable growth rate though the level has dropped. 6. Increase rate of real labour productivity ($) 7 Level of labour productivity フランス France ドイツ Germany 日本 Japan France フランス Germany ドイツ Japan 日本 英国 U.K. U.S. 米国 1 U.K. 英国 U.S. 米国 Source: Prepared based on OECD.Stat. (Note) The following issues accompany the purchasing power parity technique employed for comparing the levels of labour productivity in different countries: problems with the selection of products and services used for the calculation, and the problem that same products and services have differing qualities depending on countries. 7

13 Electricity, gas and water Information and communications Metal Chemical Finance and insurance Electric equipment Other manufacturing Wholesale and retail trade Transportation equipment Eating and drinking services, accommodations General machinery Construction Transport and warehousing Real estate General machinery Chemical Transportation equipment Finance and insurance Metal Information and communications Construction Electric equipment Electricity, gas and water Transport and warehousing Wholesale and retail trade Other manufacturing Real estate Eating and drinking services, accommodations 2. Chapter 2 Challenges for the sustainable growth of the Japanese economy - Challenges for improving productivity in Japan (2) - When labour productivity levels are compared between Japan and the U.S. across industries, levels are lower in Japan mainly in the non-manufacturing industries. When the levels of IT capital investment as an investment element are compared between Japan and the U.S., investment in this area is lower in Japan in almost all industries. It has been pointed out that reluctance for corporate restructuring has slowed down the introduction of IT in Japan; in order to improve labour productivity, it is important to actively invest in the IT sector. [Average value for 2-26] Japan s labour productivity levels by industry (U.S. = 1) 2% % 6% 8% [Average value for 2-26] Japan s IT capital investment by industry (U.S. = 1) 2. 2% % 6% 8% Source: Prepared based on GGDC (Groningen Growth and Development Center) data. Horizontal axis: Labour input by industry/ Vertical axis: Man-hour(s) 8

14 Korea (28) 国 (28) Canada (28) Czech Republic Belgium Slovenia Sweden France Australia Japan (28) 本 (28) Denmark Austria Portugal Italy Germany U.S. U.K. Finland Netherlands Spain Luxembourg Ireland Chapter 2 Challenges for the sustainable growth of the Japanese economy - Challenges for improving productivity in Japan (3) - According to the analysis of factors of labour productivity in light of intangible assets (1. computerized information such as software, 2. innovative property such as R&D, and 3. economic competencies, i.e. investments in brand equity, organizational structure, and human capital), which is gaining increasing attention in relation to recent productivity analyses, while the contribution of intangible assets to the increase of productivity is large in other countries, that of Japan is small. When capital investments are compared internationally, in Japan, the proportions of investments in tangible assets such as buildings, machinery, and equipment are higher, while the proportions of investments in intangible assets are lower; especially, the proportions of investments in economic competencies are considerably lower Analysis of factors of labour productivity in light of intangible assets (Average values for 1-27) TFP 変化率 growth rate 無形資産の寄与度 Level of contribution of intangible assets 労働の質 Labour quality 有形資産の寄与度 Level of contribution of tangible assets Labour quality (.) Japan 日本 U.S. 米国 U.K. 英国 Germany ドイツ France フランススウェーデン Sweden International comparison of capital investments (%:Proportion of capital investment in added value) 3 Tangible 有形資産 assets 韓 カチナェダコ共和国 (28) ベルギー スロベニア スウェーデン フランス オーストラリア 日 Innovative 革新的資産 property デンマーク オーストリア ポルトガル イタリア ドイツ 米国 英国 Computerized information 情報化資産 Economic 経済的競争能力 competencies Source: Investments in Intangible Assets by Industries and Economic Growth in Japan, Miyagawa and Hisa (213) (left figure) Supporting investment in knowledge capital, growth and innovation OECD (213) (right figure) (Note) Total factor productivity (TFP) is regarded as the portion (residual error) of production increase which cannot be measured by the increase in investments of production elements such as capital and labour, and is understood to reflect innovation, management efficiency, etc. As for labour quality, on the basis that the level of wages reflects the fluctuation in labour productivity, workers are grouped according to attributes such as education level and age, and based on the growth accounting perspective, it is regarded that the labour quality has risen when there is an increase in the proportion of the group with higher total wages. フィンランド オランダ スペイン ルクセンブルク アイルランド

15 Chapter 2 Challenges for the sustainable growth of the Japanese economy - Challenges for improving productivity in Japan () - Looking at the investments in intangible assets in Japan, the U.S., and Germany, when economic competencies are analyzed in terms of investments in brand equity and organizational structure and investments by firms in human capital, investments by firms in human capital have dropped sharply in Japan; the proportion of investments in this category is approximately 1% of those of the U.S. and Germany. Though it must be noted that on-the-job training costs are not included in investments by firms in human capital since this item is estimated based on off-the-job training costs, the drop in the proportion of investments in human capital raises concerns about the fact that human capital is not being accumulated for the future. Investments in intangible assets (Trillion Japanese yen) 3 Japan ブランド資産 組織改編企業が行う人的資本投資革新的資産 Innovative property 情報化資産 Brand equity and organizational structure Investments by firms in human capital Computerized information (1 billion U.S. dollars) U.S. (1 billion euros) Germany Source: Prepared based on INTAN-Invest database and JIP database. 1

16 IT capital stock (Log-transformed value) Chapter 2 Challenges for the sustainable growth of the Japanese economy - Challenges for improving productivity in Japan () - Percentage of specialists/professionals Looking at the relationship between added value growth rates by industry and intangible assets, IT capital, as well as the percentage of specialists/technicians in order to examine whether or not there is a difference in added value growth rates when intangible assets such as investments in brand equity, organizational structure, and human capital are combined with other investment elements, there are more industries with higher added value growth rates in the industry groups with higher-thanaverage intangible asset stocks and IT capital stocks. Furthermore, there are more industries with higher added value growth rates in the industry groups with higher-than-average intangible asset stocks and percentages of specialists/technicians. As demonstrated by these data, industry growth is enhanced by simultaneously increasing investments in intangible assets as well as the above mentioned investment elements. 1 Real added value growth rate by intangible asset stock and IT capital stock Real added value growth rate by intangible asset stock and percentage of specialists/professionals 17 A large number of industry 3 groups with positive growth rates are observed Intangible asset stock (log-transformed value) Intangible asset stock (log-transformed value) - Source: Prepared based on Japan Industrial Productivity (JIP) Data base, The Research Institute of Economy, Trade and Industry. (Note): The size of the bubbles represents the size of growth rates. Bubbles of industries with positive growth rates are shown in dark colors. 11

17 Total of the Industries Mining and Quarrying of stone and gravel Construction Manufacturing Electricity, gas, heat supply and water Information and communications Transport and postal activities Wholesale and retail trade Finance and insurance Real estate and goods rental and leasing Scientific research, professional and technical services Eating and drinking services, accommodations Living-related and personal services and amusement services Education, learning support Medical, health care and welfare Services, N.E.C Government, except elsewhere classified Chapter 3 For the realization of more effective work styles - Current work styles in Japan - While the total actual working hours of workers has decreased mainly due to the increase in the ratio of part-time workers, the total actual working hours of full-time workers has not changed significantly. When examined by industries, the percentage of workers working 6 hours or longer per week is high in Eating and drinking services, accommodations, transport and postal activities, as well as living-related and personal services and amusement services. When examined by age groups, the percentage of regular male staff/employees working 6 hours or longer per week is high in age groups from 2 to 産業計 Percentage of workers working 6 hours or longer per week by industry (regular).7 鉱業, 採石業, 砂利採取業 16.6 建設業 8. 製造業.3 電気 ガス 熱供給 水道業 11. 情報通信業 28.3 運輸業, 郵便業 17.1 卸売業, 小売業 11. 金融業, 保険業 16.8 不動産業, 物品賃貸業 13.3 学術研究, 専門 技術サービス業 32.1 宿泊業, 飲食サービス業 22.3 生活関連サービス業, 娯楽業 1.2 教育, 学習支援業 6. 医療, 福祉 サービス業 ( 他に分類されないもの ) 公務 ( 他に分類されるものを除く ) to years old Transition of the percentage of regular staff/employees working 6 hours or longer per week (male) Total of all ages 2 to 2 years old 3 to 3 years old 3 to 3 years old to years old 2 to2 years old to years old to years old Source: Prepared based on Basic Statistical Survey on Employment Structure (212), Statistics Bureau, MIC (left figure). Prepared based on Basic Statistical Survey on Employment Structure, Statistics Bureau, MIC (right figure). 12

18 人手不足だから業務の繁閑が激しいから 突発的な業務が生じやすいから仕事の性質や顧客の都合上 所定外でないとできない仕事があるから急な方針変更や曖昧な指示 プロセスの多い決裁手続き 長時間におよぶ会議など 仕事の進め方にムダがあるから組織間や従業員間で業務配分にムラがあるから求められている成果が明確でないから自分が納得できるまで仕上げたいから仕事が面白いから納期やノルマが厳しいから営業時間が長いから残業手当や休日手当を稼ぎたいから残業が昇進 昇格など人事上で評価される慣行 風土があるから成果 業績主義化や仕事の個別化等で 職場に助け合いの雰囲気がないから職場に帰りにくい雰囲気があるから自分の能力や技術が足りないからその他 Causes of overtime work (workers / by annual income) Less than 3 million yen 3 to million yen to 8 million yen 8 million yen and over 人員が不足しているから雇用の初期費用が高いから業務の繁閑が激しいから 突発的な業務が生じやすいから仕事の性質や顧客の都合上 所定外でないとできない仕事があるから仕事の進め方にムダがあるから組織間や従業員間の業務配分にムラがあるから個々の仕事に求める成果が明確でないから納期やノルマが厳しいから営業時間が長いから ( 従業員が ) 残業手当や休日手当を稼ぎたいから ( 従業員が ) 人事評価を気にしているから成果 業績主義化や業務の個別化等で 職場に助け合いの雰囲気がないから職場に帰りにくい雰囲気があるから能力 技術不足で時間がかかってしまう従業員がいるからその他 Causes of overtime work (employers) According to a survey of workers and employers, the percentage of respondents that gave the following reasons for the occurrence of overtime work was high in both groups: fluctuation in the amount of work, the frequent arising sudden and unforeseen duties, and staff shortage. In addition, a high percentage of workers responded that overtime work occurs because they want to produce satisfactory products/results based on their own standards. Meanwhile, only a low percentage of workers responded that they work overtime to earn overtime and holiday/day-off allowances. High percentage of employers responded that overtime work is caused because work is performed inefficiently or because there are duties that must be performed by working overtime due to customers circumstances. Also, many employers responded that employees who take time to perform work because of lack of ability and skills are the cause of overtime work. Chapter 3 For the realization of more effective work styles - Current circumstances and challenges of work styles in terms of worker s and employer s perspectives (1) - Source: Prepared based on Survey on Work Hours and Work Style Needs (21), Japan Institute for Labour Policy and Training (upper figure). Prepared based on Survey on Work Hours Management and Efficient Work Styles (21), Japan Institute for Labour Policy and Training (lower figure). 13 Insufficient number of staff Extreme fluctuation in work amount, frequently arising sudden and unforeseen duties Duties that must be performed by working overtime due to the nature of work or customers circumstances Inefficiently performed work due to sudden policy changes, ambiguous instructions, final decision-making process with too many steps, long meetings, etc. Unevenly distributed work among employees and the organization Unclearly specified expected results To produce products/results of satisfactory quality Work is interesting Tough delivery schedules and quota Long operating hours To earn overtime and holiday/day-off allowances Company culture/custom that recognizes overtime as an item of personnel evaluation for advancement in rank, position, etc. No atmosphere of cooperation at workplace due to emphasis on outcome/performance and individualization of work Workplace atmosphere makes it difficult to leave earlier than others My own lack of ability and skills Others Lack of workers High initial costs of hiring Extreme fluctuation in work amount, frequently arising sudden and unforeseen duties Duties that must be performed by working overtime due to the nature of work or customers circumstances Work is performed inefficiently Unevenly distributed work among employees and the organization Unclearly specified expected results of individual duties Tough delivery schedules and quota Long operating hours (For employees) to earn overtime and holiday/dayoff allowances Personnel evaluation is in the mind (of employees) No atmosphere of cooperation at workplace due to emphasis on outcome/performance and individualization of work Workplace atmosphere makes it difficult to leave earlier than others Employees who take time to perform work because of lack of ability and skills Others

19 Chapter 3 For the realization of more effective work styles - Current circumstances and challenges of work styles in terms of worker s and employer s perspectives (2) - According to the survey of employers, a high percentage of them do not include overtime work in the personnel evaluation items for advancement in rank or position. IT utilization is regarded as a tool for efficient work styles; nearly 2% of employers responded that the total actual working hours decreased by IT utilization. In order to reduce overtime work which is caused by heteronomous factors, it is important to distribute staff efficiently based on analyses of fluctuation in demand, and to build business models that are less likely to be affected by outside factors. Meanwhile, IT utilization and good communication between superiors and subordinates are important for performing work efficiently. Personnel evaluation of overtime work (employer) (Unit: %) Evaluate positively (including if Evaluate anything ),.1 negatively (including if anything ),.7 Advancement in rank or position of employees who worked overtime (employer) (Unit: %) (Rank or position of employees who worked overtime has) advanced, Change in the total actual working hours due to increased IT utilization 7.1 Not evaluate (Length of overtime work is unrelated with personnel evaluation), 8.7 Cannot tell for sure, 37. Cannot tell for sure, 68.6 Not advanced, Increased 増えた Not 変わらない changed Decreased 減った (Total actual working hours of the entire company) Source: Prepared based on Survey on Work Hours Management and Efficient Work Styles (21), Japan Institute for Labour Policy and Training. 1

20 Work conditions (e.g. actual work hours) reality check Establishment of No Overtime Day Forced lights off, forced shutdown of all PCs Calls to finish work using company announcing system etc. Calls from top executives and awareness enhancement activities based on management strategies Introduction of advance overtime work report system Alerting and advising of long-hour workers and their supervisors Appropriate staffing Review of details and distribution of duties Utilization of non-regular employees and outsourcing Training and awareness enhancement activities for executives regarding work hour management and health maintenance Training and awareness enhancement activities for non-executives regarding work hour management and health maintenance Granting of compensation day-off for day-off/holiday work Evaluation by committee etc. Others Chapter 3 For the realization of more effective work styles - Aiming at creating a virtuous cycle for workers and employers by improving work styles (1) - Many companies that were successful in reducing overtime work took the following approaches: work condition reality check, alerting and advising workers working long hours and their superiors, and reviewing details and distribution of duties. Such companies tended to regard their company as having higher labour productivity in comparison with those of industry peers. Hence, reduction of overtime work is meaningful not only for workers but for companies as well. According to the responses given in company interviews, the positive effects of reduction in work hours included fatigue reduction, increased motivation, and self-improvement Approaches taken by companies that successfully reduced overtime work の実設ノ一強終社経経の所に長把態定ー斉制業内営営導定対時握 ( 残実電消の放戦ト入外す間業際源灯呼送略ッ労る労デのオ び等化プ働注働ー P 労フ掛の C ににか働のけよよらの意者事喚るるのや時意呼前起そ間識び届やの等啓掛出助上 ) 発け制言司等や 2. 適正な人員確保 見仕外非管労非労代休直事部正理働管働休日しの委社職時理時の労内託員向間職間付働容化のけ管向管与に 分の活の理け理対担推用研やのやすの進や修健研健る 意康修康識確 意確啓保識保発にに係啓係る発る 17.1 委員会等による検討 1. その他 Assessment of labour productivity by companies with and without overtime reduction (comparison with industry peers) Source: Prepared based on Survey on Work Hours Management and Efficient Work Styles (21), Japan Institute for Labour Policy and Training Reduced 短縮された Not をchanged ( よ変含くわ (including む Not 分らclear ) ) かならいない (Whether or not overtime work was reduced) Low or Rather low Cannot specify / Do not know High or Rather high

21 Chapter 3 For the realization of more effective work styles - Aiming at creating a virtuous cycle for workers and employers by improving work styles (2) - In order to maintain/enhance production activities while reducing work hours, labour productivity must be enhanced and labour input must be increased. A high percentage of companies that implement educational training regards themselves as having higher labour productivity in comparison with those of industry peers, and state that their sales (over the past three years) have increased. It is important to provide diverse work styles that meet the needs of workers who wish to work more hours and potential workers who are unemployed due to being unable to find jobs because of work conditions, such as work hours and work schedules, so that they can participate in labour in ways that suit their desired work conditions Implementation of educational training and labour productivity Low Rather low Implementation of educational training and transition of sales over the past three years Dropped sharply (1% and over) Decreased (more than % and less than 1% ) Nearly flat (increase/ decrease of less Cannot specify than %) 3 / Do not know 3 Increased sharply.1% (1% and over) % 2 Rather high Increased 1 23.% 1.2% 1 (more than % and less than 1% ) Implemented 取 Not implemented 取取取 High Implemented Not implemented りりりり組組組組んんんん (Educational training activities) (Educational で training activities) でででいいいいるなるないい Source: Prepared based on Survey on Work Hours Management and Efficient Work Styles (21), Japan Institute for Labour Policy and Training. 16

22 Number of excess new residents (below zero: number of excess departed residents) Number of excess new residents (below zero: number of excess departed residents) Number of excess new residents (below zero: number of excess departed residents) Chapter Desirable state of local economies in the face of population decline - Demographic trends and labour supply limitations - Population inflow to the Tokyo-area has been increasing since 211. Young age groups of both males and females tend to concentrate in the Tokyo-area due to the concentration of universities and large companies. (1, persons) Osaka-area Nagoya-area Tokyo-area Population inflow to the three metropolitan areas (1, persons) Population inflow to the three metropolitan areas (male, 21) Tokyo-area Nagoya-area Osaka-area (1, persons) 3. (Age) (Age) Source: Internal Migration in Japan Derived from the Basic Resident Registers, Statistics Bureau, MIC Tokyo-area: Saitama-ken, Chiba-ken, Tokyo-to, Kanagawa-ken Nagoya-area: Gifu-ken, Aichi-ken, Mie-ken Osaka-area: Kyoto-fu, Osaka-fu, Hyogo-ken, Nara-ken Population inflow to the three metropolitan areas (female, 21) Tokyo-area Osaka-area Nagoya-area

23 Average annual income of full-time workers (log-transformed value) Chapter Desirable state of local economies in the face of population decline - Challenges for creating a virtuous economic cycle in regions (1) - Ratio of net inflow among prefectures related to employment Labour productivity (log-transformed value) The average annual income, i.e. the wage standard, tends to be higher in regions with higher labour productivity. Accordingly, there is a trend of employment-related population flow to areas with higher wage standards. Levels of labour productivity are higher in areas with higher concentration of population and higher population density. Efforts to increase labour productivity are crucial for the growth of local economies. (Yen) 1.7 Relationship of labour productivity and the average annual income of full-time workers Relationship of the average annual income of full-time workers and employment-related population flow among prefectures 1. (Yen/man hour) 8.8 Relationship of population density and labour productivity 1.6 y =.127x -.12 (.27) R² = y =.8x (13.186) (16.2) R² = (Yen/man hour) Labour productivity (log-transformed value) y =.1x (.772) R² = Young generations 若年層 All generations 全体 Difference between the national average of the average annual income of full-time workers, excluding effects of educational levels etc y =.126x (6.711) (7.1) R² = (Population / km 2 ) Population density (log-transformed value) Source: Estimated based on Monthly Labour Survey (regional), Basic Survey on Wage Structure, MHLW, Prefectural Accounts, Cabinet Office, Retail Price Survey (Structural Survey), Basic Statistical Survey on Employment Structure (212), Population Estimates, and Regional Statistics Database, Statistics Bureau, MIC. 18

24 Labour productivity (log-transformed value) Chapter Desirable state of local economies in the face of population decline - Challenges for creating a virtuous economic cycle in regions (2) - Definitely want to work at a large company A large company is desirable if the work matches my career interests A small or medium-sized company is okay if the work is satisfying Want to work at a small or mediumsized company Others (want to become a government official, want to return to home town, etc.) Want to start up my own company There are correlations between improvements in labour productivity and the concentration of population, businesses, as well as human resources (e.g. people who have received higher education at universities or junior colleges, and people who work on self-development); it is important to effectively utilize these concentration benefits. In order to enhance this human resource group, improvements in the employment situation and attractive employment opportunities are needed. (Yen/man-hour) 8.8 Relationship between labour productivity and concentration of graduates of higher education institutes (Yen/man-hour) Job expectations of university students 8.7 Class 2 年卒 of Class 21 年卒 of 21 Class 21 年卒 of y =.111x (6.8) (2.73) R² = (Number of graduates of higher education institutes/km 2 ) Density of graduates of higher education institutes (log-transformed value) (Number of people who work on self-development/km 2 ) 絶対に大手がよい いる自の分でのあやれりばた大い手仕企事業ががでよき ばや中り堅が い中の小あ企る業仕で事もでよあいれ 中堅 中小企業がよい 望そなのど他 ( ) 公務員 U ターン志 自分で会社を起こしたい Source: Estimated based on Monthly Labour Survey (regional), MHLW, Prefectural Accounts, Cabinet Office, Population Census (21), Basic Statistical Survey on Employment Structure (212), Regional Statistics Database, Statistics Bureau, MIC (left figure) (central figure). Mynavi s Survey on Job Expectations of University Students, Mynavi Corporation (right figure) 1

25 Employment rate of females of the childrearing generation Chapter Desirable state of local economies in the face of population decline - Challenges for creating a virtuous economic cycle in regions (3) - Employment rate of females of the childrearing generation Employment rate of females of the childrearing generation Employment rate of females of the childrearing generation Employment rate of females of the childrearing generation In the era of population decline, it is important to make efforts to motivate people who do not have the experience of participating in the labour market to work and to encourage labour participation. A large number of women who want to work are not searching for jobs due to bearing and raising of children. In order to encourage females of the child-rearing generation to work, sufficient day-care center capacity must be provided and long working hours must be suppressed to create an environment that enables the balancing of work and child-rearing Relationship between the employment rate of females of the child-rearing generation and the ratio of day-care center capacity y =.722x (8.763) (1.633) R² = Ratio of day-care center capacity Relationship between the employment rate of females of the child-rearing generation and the ratio of them living with parents y =.7773x +.2 (.3) (23.6) R² = Ratio of females of the child-rearing generation living with parents Relationship between the employment rate of females of the child-rearing generation and the ratio of workers of the childrearing generation working long hours y = -2.7x (-8.2) (1.36) R² = Ratio of workers of the child-rearing generation working long hours Source: Estimated based on Report on Circumstances Related to Day-Care Centers, MHLW, Basic Statistical Survey on Employment Structure (212), Survey on Time Use and Leisure Activities (211), and Population Estimates, Statistics Bureau, MIC Relationship between the employment rate and the commute time of females of the child-rearing generation y = -.6x (-.138) (16.738) R² = Commute time of females of the child-rearing generation (min.) Relationship between the employment rate of females of the child-rearing generation and the amount of housework and child-rearing tasks performed by males of the child-rearing generation in dual-income households y =.61x (3.7) (6.6) R² = Amount of housework and child-rearing tasks performed by males of the child-rearing generation in dual-income households 2