A longtime thorn for businesses and productivity in Japan and South Korea is set to prove a bulwark for those economies as the coronavirus threatens millions of jobs around the world.
Mass layoffs are frowned upon and labor laws make it hard for employers to fire workers in the two North Asian nations, helping keep jobless rates low. In February — even as virus cases spread — South Korea’s unemployment rate dropped to 3.3 percent while Japan’s is set to hold at 2.4 percent, according to economists surveyed ahead of data due Tuesday.
Although less than before, lifetime employment remains a hallmark of corporate cultures in both countries, with employees at the likes of Samsung Electronics Co., Sony Corp., Hyundai Motor Co. and Panasonic Corp. among beneficiaries. During the 2008-2009 financial crisis, both countries reported much lower jobless rates than the U.S. and eurozone, helping lay the groundwork for their economic recoveries.