Japan invented the term karoshi — death from overwork — 50 years ago following a string of employee tragedies. Corporate Japan is now aiming to confound stereotypes with plans for four-day working weeks.
This should be good for overworked employees. But it may lead to higher labour costs for companies that can least afford it.
Hitachi is the latest conglomerate to implement a system that allows employees a flexible work schedule of only four days a week. Panasonic and NEC announced similar plans earlier this year.
Companies hope to disrupt conservative work cultures amid an ever-worsening worker shortage and rising labour costs. They are promoting shorter working weeks as a perk that should also increase productivity. The government endorsed four-day weeks as an official policy last year.
The urgency is real. Japan’s working-age population sank to just over 75mn in 2020, down 14 per cent since 1995. Many companies have eliminated retirement age limits of 65. Electronics retailer Nojima scrapped its retirement threshold of 80 last year. Employee retention costs are rising. Japan’s labour cost index hit a record high this year.
Despite its gruelling working hours, Japan has consistently come last in labour productivity among G7 countries for the past five decades.
A shorter, more focused, working week is not a guaranteed fix. One of the main issues hurting corporate sales efficiency is a lack of clearly defined responsibilities, McKinsey researchers have found. Harmony within organisations is prioritised over individualism.
For now, companies are filling gaps in the ranks of their workforces with part-time workers. That has raised payroll costs. In Japan, as in the rest of the world, local part-time wages have risen sharply recently.
Flexible working is most problematic for small companies, where the absence of a single employee can halt production or damage service levels.
But the bigger problem may be low levels of adoption among traditionally minded Japanese employees whose work is central to their identities. Government campaigns intended to inveigle the Japanese into taking more time off have fallen flat in the past.
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