Bonuses, overtime, recruitment all down in Japan

Bonuses, overtime, recruitment all down in Japan

TOKYO (UPI): More indications of weakness in the Japanese economy emerged Thursday with bonuses, overtime and recruitment all pointing towards continued business stagnation.

A survey by the job information agency Mainichi Communications Inc. of 2,760 companies revealed that only 13 percent plan to increase their intake of new college graduates with liberal arts degrees in 1995.

The survey found 15.4 percent of companies plan to increase their hiring of science and technology majors.

Both figures are about 11 percent lower than those found the year before and suggest a greater conservatism on personnel matters.

A separate survey by the Ministry of Labor found income has suffered as well, with winter bonuses in Japan dropping for the first time on record last year. For manufacturing companies, the decline was 1.1 percent and for wholesalers, retailers and food service businesses 2.1 percent.

The ministry found that overtime hours worked in February had slipped 9.4 percent from a year before.

Faced with declining profits, many Japanese companies have resorted to intermediary steps in recent years, short of firing workers. These have included reducing payrolls through attrition and fewer new workers, limiting salary increases, slashing overtime and cutting bonuses.

Because overtime and bonuses are important for an employee's total income in many companies, however, their reduction is likely to adversely affect disposable income and private consumption.

Consumption in Japan makes up well over 50 percent of gross national product.