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No Spring Strikes During Depression

Posted January. 08, 2003 22:59,   


Amid the deepening depression that hit the economy hard, major labor unions in Japan are giving up one by one the request for a wage increase with this year`s spring strikes ahead. The labor unions of each industry said that they would not propose the rate of pay increase common to the industries, suggesting a start of change in the ways of the traditional strikes.

The lalor union of Toyota, the biggest automaker in Japan, has decided Jan. 7 that it will give up the request for a wage increase except for the amount of regular increase. In return, the union plans to demand 60,000 yen (600,000 won) a year for each worker in the form of a reward for an improved productivity. The move by the labor union of Toyota of which annual ordinary income exceeds 1 trillion yen, is expected to have a great influence on the wage negotiation of other companies.

Previously, the Confederation of Japan Automobile Workers` Unions (JAW) that had been leading the spring strikes announced for the first time that it will not demand a wage increase same to the industries and leave it to each company. Unions of major industries such as shipbuilding, electricity, and steel have given up their requests.

Unions of individual companies also abandoned their demand for a pay increase. For instance, the NTT union, the largest in the private sector, announced at the end of last year that it would put off the demand considering the difficulties in management due to the sluggish telecommunication business.

In contrast, as Nissan Motor Co., Ltd. shows a clear sign of recovery thanks to the bold restructuring by President Carlos Ghosn who previously worked for Renault, the labor union agreed to demand the raise of basic pay by 1,000 yen (10,000 won). It is, however, a rare case considering the reality of the industries.

It is notable that, this year, labor unions voluntarily decided the wage freeze, while last year, it was started at the request of the management. According to the survey conducted by the Japan Business Federation, 91% of 200 major companies froze the wage and 41% froze the regular pay increase last year.

It seems that the labor unions plan to focus on job security instead of an unnecessary struggle to raise the wage due to the worsening corporate management amid the economic slowdown. The Ministry of Public Management, Home Affairs, Posts and Telecommunications revealed that the unemployment rate last year reached 5.5%, all-time high. The labor unions are concerned that the rate will reach the level of 7% if the banks will speed up the disposal of bad loans.

Young-Ee Lee yes202@donga.com