Japan's big businesses once had a reputation for not firing workers even in hard times. Not anymore. Now major corporations are going full blast to restructure, with older workers bearing the brunt of the austerity drive. The lifetime employment system, once touted as a symbol of corporate Japan, is now in danger of collapse. So is the seniority-based wage system that forms the other main pillar of Japan's employment system. Now an increasing number of companies are introducing a merit-based annual pay system and are trying to cancel automatic annual wage hikes that have been taken for granted for decades.
All this, of course, is causing much suffering to millions of white-collar workers who have pledged lifelong allegiance to their companies. A tragic demonstration of this occurred in mid-March at the head office of Bridgestone Corp., a top tire maker, where an angry employee committed suicide by disembowelment in protest against restructuring. In a statement addressed to the president, the worker said he "has loved Bridgestone so much and will continue to love it so."
Japanese companies often discharge employees more harshly than U.S. firms. In America, workers are laid off on the basis of seniority. During a business slump young workers are the first to go, but older workers are rehired first if things begin to improve. In Japan, older employees are let go first, without regard for seniority, and have little or no chance of being rehired even if business starts picking up.