Jobu Kurieishon (Job Creation in Japan), by Genda Yūji. Tokyo: Nihon Keizai Shinbunsha, 2004, 368 pp., ¥3,780 (hardcover ISBN 4-532-13273-8)

Abstract

Changes in Japanese employment in the past decade can only be matched by the productivity of one Japanese economist, Genda Yūji, to write about them. Beginning with his Shigoto no Naka no Aimai-na Fuan (2001), Genda has produced a number of books analyzing the impact of economic downturn and risutora on Japanese employment relations. The 2001 book garnered for him two prestigious prizes—the Nikkei-Keizai Tosho Bunkashō and the Suntory Gakugeishō—and an English translation was recently published as A Nagging Sense of Job Insecurity: The New Reality Facing Japanese Youth (2005). Although only in his mid-40s, Genda has had a major impact through his research and writings on popular discourse and government policy regarding a host of employment woes that have plagued post-bubble Japan. The present volume is consistent with Genda’s general emphasis on the impact of economic recession and structural change on labor demand, especially in terms of how the latter has disproportionately affected Japan’s youth. In his characteristic way, Genda combines sophisticated analysis of quantitative data with a lucid writing style to reach not only academic economists but a broader reading audience as well. He focuses on the issue of how job creation and destruction take place, using this as a framework for understanding changes in Japanese employment during the ‘lost decade’ of the 1990s. The topic is generally studied as a technical one, given that job creation can come from an increase in jobs in existing firms or from an increase in the number of new firms, and similarly, job destruction can come from a decline in the number of jobs in existing firms or from firm bankruptcies. The complexity of the issues involved necessitates that any researcher trying to untangle the sources of job creation and loss be capable of handling data with sophisticated methods. Genda uses the firm as the unit of analysis to look at the mechanisms of how job creation and loss occurred. He posits two turning points in the 1990s. The first followed the bursting of the economic bubble in 1992, with a general contraction of employment opportunities being felt throughout the economy. More important in some ways for Genda’s argument is the second turning point, 1997, which ushered in particularly significant rates of job loss in the sector comprised of chūshō-kigyō (small firms) and in the construction industry. Genda devotes considerable attention to the small-firm sector as one of the traditional engines of job creation, a point to which I return below.