Japanese Companies Plan to Fire 30,000 Temp Workers by March

By Toru Fujioka and Jason Clenfield

Nov. 28 (Bloomberg) -- Japanese companies plan to fire more than 30,000 temporary and part-time workers before the end of the business year as the recession deepens.

Companies will lay off at least 30,067 non-permanent workers in the six months to March 31, according to a survey released by the Labor Ministry today in Tokyo.

Japanese manufacturers plan the sharpest production cuts in 35 years in response to a global recession, a report showed today. The reductions have led to a spate of lay offs, the brunt of which have fallen on the easy-to-fire temporary workers that companies hired to augment their workforces during the expansion of the past six years.

“You're very, very reluctant to cut into the core of your workforce,” said Richard Jerram, chief economist at Macquarie Securities Ltd. in Tokyo. “You do want to cut costs. So you cut advertising -- and that business has been horrible. You cut temporary workers. You cut anything you can, apart from cutting into the bone.”

Some 19,500 temporary workers in the manufacturing sector will lose their jobs in the next six months, the labor ministry said. About 4,100 of those layoffs will occur in Aichi Prefecture, where Toyota Motor Corp. has its headquarters and some factories. The automaker said last week it will halve its temporary workforce to 3,000 by the end of the fiscal year.

Job cuts to part-time staff have been announced in the past month by Mitsubishi Motors Corp., Daimler AG's Mitsubishi Fuso Truck & Bus Corp., Isuzu Motors Ltd., Mazda Motor Corp. and Toyota.

Aso's Concern

Prime Minister Taro Aso yesterday asked ruling-party lawmakers to find ways to protect contract employees' jobs and help unemployed people find work, the Nikkei newspaper reported.

Speaking after a report showed that one in five job applicants will be unable to find work, Economic and Fiscal Policy Minister Kaoru Yosano said today the labor market “is an issue the government and the ruling coalition should be worried about.”

Non-regular employees made up a record 34.5 percent of the workforce last quarter, the labor ministry said. In 1990, only 20 percent of workers held those jobs.

The increased hiring of part-time employees has made it easier for companies to shed workers when business is slow and helped cut costs for salaries and benefits.

It's also raised anxiety for non-regular employees whose jobs are insecure and whose wages are on average about 40 percent lower than their full-time counterparts, according to Atsushi Seike, a labor economist at Tokyo's Keio University and a member of the government's labor policy council.

To contact the reporters on this story: Toru Fujioka in Tokyo at tfujioka1@bloomberg.netJason Clenfield in Tokyo at jclenfield@bloomberg.net