While it is true that wage growth in Japan has been stalled for the past three decades, isn't it also true that an entire generation or more of Japanese has been able during those decades to finance the purchase of homes, cars and other goods and services at ultra-low interest rates, which have been the envy of consumers in most of the rest of the world, while also enjoying full employment and very low, or even negative, price inflation? I have often wondered whether said generation feels these circumstances have been a good thing, or a bad thing, for them and their families?
Thanks for reading, as always. Yes, you make a good point about the importance of measuring what is left after paying taxes, various expenses - taking into account the effect of inflation, etc. Perhaps the average Japanese household feels somewhat satisfied, but my gut feeling is that there is a lot of pent-up frustration about wages. Moreover, one would be hard pressed to conclude that the level of happiness is anywhere near that measured in Scandinavian countries, for example. Just think about how long the typical Japanese salaryman toils at the office. I suspect that there is a fair amount of envy among Japanese who are familiar with salary levels abroad. In addition, the substantial and unresolved gender gap in Japan is another related issue to consider. It's no wonder that Japan is facing a brain drain - especially of women - who are seeking not only higher wages but also a higher degree of respect for equal work by leaving the Japanese workforce and emigrating abroad.
Nov 7, 2023·edited Nov 7, 2023Liked by Mark Kennedy
I always enjoy reading you, Mark. Always a great read. Thank you.
Yes, the gender gap is inexcusable in this day and age. Also, I know from over-worked friends and relatives in Japan that some industries are barely able to continue operating because they are short of the right staff in the right numbers. Is Japan hoping to plug the gap with AI and robotics? What is preventing recruitment from overseas, low salaries or xenophobia - or both?! I guess it's not only low salaries which makes Japan an unattractive destination for expats. Most, if not all, expats in Japan can't obtain loans to buy homes and cars, right?
Thank you for your additional feedback and compliments. You've certainly hit a lot of hot buttons. Another big one for those with substantial assets is the oppressive nature of inheritance taxes. Even as someone with a permanent visa, I have come to terms with the fact that I will always be considered a "guest" in Japan. As such, I will simply have to abide by their rules. While there are certain aspects that are in dire need of reform, the positive facets of living in Japan outweigh the challenges.
Yes, as we watch with horror what is going on in The West, the positive facets of living in Japan grow more and more valuable. I just hope Japan can avoid contamination/damage from the giant mess The West is getting itself into 🤞🏻
Low wages apart, I think what makes Japanese companies unappealing is their infamous working environment (long working hours, sacrificing individual and family needs to the company, peer pressure to follow certain unwritten rules). Who wants to work under those conditions? Even in Japan, the younger generations are distancing themselves from those practices. 30% of new graduates are said to leave their company/change job within three years.
As far as I know, expats/immigrants can obtain loans in Japan as long as their can show a sound financial record.
Yes, I know what you mean about the infamous working environment. I've never worked in Japan; but I have a theory that the Japanese are still dealing with inter-generational trauma caused during the Edo period. As you say, the younger generation seem to have a changing mindset. However, rejecting the old ways is one thing. Embracing foreign employers and workplace culture is another. I guess the Japanese will develop a new culture of their own over time.
With regard to credit, what I've been told is that foreigners who don't have a "permanent" visa have great difficulty in obtaining anything other than a credit card.
Nov 7, 2023·edited Nov 7, 2023Liked by Mark Kennedy
My friends and relatives working in Japan tell me that many Japanese - quite understandably - find it difficult to adapt to foreigners' ways of working/culture and prefer to work for Japanese employers, even if the salaries paid by foreign employers are higher.
Yes, that is my impression, too. It certainly depends upon the corporate culture of each specific company, however. Some foreign companies are operated very much like a typical Japanese company.
a lifetime slaving away, 17 hrs/day, just to make one or two million.......if you don't karoshi first. crazy work culture here. so glad im not japanese.
Thanks for reading and for leaving a comment. Yes, these numbers do seem a little low, but there are, naturally, a range of options of potential careers in Japan. The "salaryman" track is not the only possibility.
I agree. While it is encouraging to see some relatively high-profile initiatives to promote entrepreneurship and startups, this is still a relatively narrow niche in Japan.
Thanks Mark. Interesting and rather troubling data. My preferred measuring sticks remains the average annual income that you can typically find in online sources: 6 million yen.
Yes, I agree, but, having run such a company for many years, foreign companies operating in Japan tend to be very aware of the market rate. While they may be more willing to pay a slight premium, it's probably not that much more at the end of the day.
While it is true that wage growth in Japan has been stalled for the past three decades, isn't it also true that an entire generation or more of Japanese has been able during those decades to finance the purchase of homes, cars and other goods and services at ultra-low interest rates, which have been the envy of consumers in most of the rest of the world, while also enjoying full employment and very low, or even negative, price inflation? I have often wondered whether said generation feels these circumstances have been a good thing, or a bad thing, for them and their families?
Thanks for reading, as always. Yes, you make a good point about the importance of measuring what is left after paying taxes, various expenses - taking into account the effect of inflation, etc. Perhaps the average Japanese household feels somewhat satisfied, but my gut feeling is that there is a lot of pent-up frustration about wages. Moreover, one would be hard pressed to conclude that the level of happiness is anywhere near that measured in Scandinavian countries, for example. Just think about how long the typical Japanese salaryman toils at the office. I suspect that there is a fair amount of envy among Japanese who are familiar with salary levels abroad. In addition, the substantial and unresolved gender gap in Japan is another related issue to consider. It's no wonder that Japan is facing a brain drain - especially of women - who are seeking not only higher wages but also a higher degree of respect for equal work by leaving the Japanese workforce and emigrating abroad.
I always enjoy reading you, Mark. Always a great read. Thank you.
Yes, the gender gap is inexcusable in this day and age. Also, I know from over-worked friends and relatives in Japan that some industries are barely able to continue operating because they are short of the right staff in the right numbers. Is Japan hoping to plug the gap with AI and robotics? What is preventing recruitment from overseas, low salaries or xenophobia - or both?! I guess it's not only low salaries which makes Japan an unattractive destination for expats. Most, if not all, expats in Japan can't obtain loans to buy homes and cars, right?
Thank you for your additional feedback and compliments. You've certainly hit a lot of hot buttons. Another big one for those with substantial assets is the oppressive nature of inheritance taxes. Even as someone with a permanent visa, I have come to terms with the fact that I will always be considered a "guest" in Japan. As such, I will simply have to abide by their rules. While there are certain aspects that are in dire need of reform, the positive facets of living in Japan outweigh the challenges.
Yes, as we watch with horror what is going on in The West, the positive facets of living in Japan grow more and more valuable. I just hope Japan can avoid contamination/damage from the giant mess The West is getting itself into 🤞🏻
Low wages apart, I think what makes Japanese companies unappealing is their infamous working environment (long working hours, sacrificing individual and family needs to the company, peer pressure to follow certain unwritten rules). Who wants to work under those conditions? Even in Japan, the younger generations are distancing themselves from those practices. 30% of new graduates are said to leave their company/change job within three years.
As far as I know, expats/immigrants can obtain loans in Japan as long as their can show a sound financial record.
Yes, I know what you mean about the infamous working environment. I've never worked in Japan; but I have a theory that the Japanese are still dealing with inter-generational trauma caused during the Edo period. As you say, the younger generation seem to have a changing mindset. However, rejecting the old ways is one thing. Embracing foreign employers and workplace culture is another. I guess the Japanese will develop a new culture of their own over time.
With regard to credit, what I've been told is that foreigners who don't have a "permanent" visa have great difficulty in obtaining anything other than a credit card.
We're aligned. Thanks for reading and adding a comment.
Seems like this would push more Japanese to work for gaishikei, ne?
My friends and relatives working in Japan tell me that many Japanese - quite understandably - find it difficult to adapt to foreigners' ways of working/culture and prefer to work for Japanese employers, even if the salaries paid by foreign employers are higher.
Yes, that is my impression, too. It certainly depends upon the corporate culture of each specific company, however. Some foreign companies are operated very much like a typical Japanese company.
a lifetime slaving away, 17 hrs/day, just to make one or two million.......if you don't karoshi first. crazy work culture here. so glad im not japanese.
Thanks for reading and for leaving a comment. Yes, these numbers do seem a little low, but there are, naturally, a range of options of potential careers in Japan. The "salaryman" track is not the only possibility.
youre quite right. fortunately, im gaijin, so my first option is entrepeneurship.
I agree. While it is encouraging to see some relatively high-profile initiatives to promote entrepreneurship and startups, this is still a relatively narrow niche in Japan.
Thanks Mark. Interesting and rather troubling data. My preferred measuring sticks remains the average annual income that you can typically find in online sources: 6 million yen.
Yes, I agree, but, having run such a company for many years, foreign companies operating in Japan tend to be very aware of the market rate. While they may be more willing to pay a slight premium, it's probably not that much more at the end of the day.