The recent arrest of Tadao Koseki, former president of KSD, a mutual-aid society for small business, on bribery charges has turned the spotlight on problems involving foreigners working here as “trainees.” Koseki was also director of an agency called IMM Japan that takes care of trainees from Indonesia.
Investigators say he bribed a Liberal Democratic Party legislator to promote the KSD. In addition, he is said to have used a KSD affiliate to buy 150,000 music CDs (worth more than 100 million yen) by his favorite female singer and put his relatives on the boards of associated companies.
Problems involving Indonesian trainees, who come here through IMM Japan, were cited in a survey released last March by a private research group. Here are the key findings:
1. Most trainees were engaged in simple work, so they did not think they were receiving technical training.
2. Most trainees, including those in their second or third year of training, did overtime or worked on Sundays. However, the allowances and wages were held below prevailing standards on the grounds that they were trainees.
3. Trainees’ passports were kept in custody, and some of their wages were withheld under in-house savings plans. These moves were apparently aimed at restricting trainees’ activities outside the workplace.
Later in the same month, the Justice Ministry ordered IMM Japan to stop holding the passports and cancel the saving plans. In November, the Labor Ministry issued similar instructions.
The government set up, in 1991, the Japan International Training Cooperation Organization to provide guidance and advice concerning the entire training system. It appears, however, that this system is not working as it should, because most employers are small companies — those with fewer than 50 workers — that have little training expertise.
The training system, it seems, exists in name only, not only for IMM Japan but also for numerous similar agencies serving as hosts for trainees. The indications are that it is being used more or less as a means of securing cheap labor.
Nearly 50,000 trainees come to Japan each year through some 350 host agencies, despite a prolonged economic slump here. More than 10,000 of them receive a few years of extended “training.” These foreign workers are indispensable to small businesses, which have difficulty hiring people willing to do simple work.
Japan should stop receiving foreigners under the pretext of training. Instead, it should explicitly allow the entry of manual workers under bilateral agreements, providing that their number does not exceed a specified level.
The Health, Labor and Welfare Ministry is opposed to this idea. The importing of manual labor, it says, would divide the labor market into low-wage and high-wage sectors, making it difficult to raise worker productivity and delaying industrial structural reform.
However, Taiwan and Hong Kong, for example, have bilateral agreements with the Philippines to permit the entry of manual workers, including housemaids. There is no reason why Japan, by far the largest economy of Asia, cannot do the same.
Japan has a dual economic structure in which large companies work along with small businesses or subcontractors. This traditional structure, it should be remembered, was once cited as a major reason why Japanese industry became internationally competitive and why this nation achieved double-digit economic growth. The argument that imported labor would widen the gap does not wash.
Some industrial sectors, such as construction and waste disposal, involve work known as “three Ks” — work that is “kiken” (dangerous), “kitanai” (dirty) and “kitsui” (hard). People from developing countries should be allowed to take these jobs if they are willing to do so. That would benefit both workers and employers.
The government argues that an influx of manual workers would increase public spending in areas such as education, health care and housing. An extra financial burden should be accepted as a form of official development assistance.
Prime Minister Yoshiro Mori, during a recent visit to India, reportedly expressed a desire to have more computer-savvy Indians working in Japan to support its information-technology projects. Such a selfish policy of admitting only skilled workers would invite international criticism.
There are 1.5 million foreigners staying here for extended periods, compared with 7.3 million in Germany. So far, Japan has had little need for foreign labor, it is said, partly because cooperative labor-management relations made it easy to reassign workers or diversify their skills. Another reason given is that the practices of “service labor” (work without pay) and extended overtime reduce the need for extra workers.
However, the falling birthrate makes it certain that Japan’s population will begin to shrink. A U.N. population report released last year says the nation will have to take in 600,000 immigrants annually in order to keep its labor force at the 1995 level in the next 50 years. The need for foreign labor will increase even more if structural reform and economic expansion create labor shortages.
Japan should be ready for such developments. It should establish immigration and permanent-residence systems for foreign workers. In this sense, it is worth considering an “amnesty” for illegal residents — a measure taken in the United States and Western Europe. Allowing foreign students to settle here is also worth considering. Business leaders, including Hiroshi Okuda, head of Nikkeiren (Federation of Employers Associations), are in favor of receiving foreign workers, including manual workers.
The training system, if it is to be maintained, should be improved through tighter regulation of programs and working conditions. Also needed are humanitarian measures, such as allowing workers to return home temporarily or inviting their families to live with them here.
Japan’s traditional employment practices, such as lifetime employment and seniority wages, have changed radically since the collapse of the bubble economy. It is time that Japan started a serious debate on ways to open its closed labor market to foreign workers.
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