Labor Minister Akira Amari prioritized giving corporations’ “a chance to fight out” their business strategies through using dispatch workers to reduce labor costs.

“Employment flexibility” entered the Japanese business world lexicon in 1995. It was first used in a report by the Japan Federation of Employers’ Associations (Nikkeiren, merged with Keidanren in 2002) titled “Japanese-style Management in the New Era: Directions and Specific Measures to Take On.”

Following the 1985 Plaza Accord — in which finance ministers and central bank governors from Japan, the US, West Germany, France, and the UK agreed to a currency market intervention to depreciate the US dollar — the exchange rate between the Japanese yen and US dollar was 70 to 1. By 1995, Japan’s bubble economy had collapsed, and there was a growing sense of crisis that the 90s were becoming a “lost decade.”

Japanese corporations did not see a reversal of fortune even after the Nikkeiren report. In 1999, Keidanren released its “First Proposal for Strengthening the Competitiveness of Japanese Industry,” which included recommendations on employment.

“[Japanese] companies cannot be competitive globally if we handle business as usual, namely, if we try to achieve business transformation despite having more human resources than necessary in the company,” the proposal stated. “We need to respond to the current difficult situation in our employment practices as well.”

Labor minister Amari sided with corporations laying off workers

In 1999, Japan’s prime minister was the LDP’s Keizo Obuchi, and the minister of labor was Akira Amari. Amari would later go on to serve as minister of economy, trade and industry in Prime Minister Shinzo Abe’s cabinet, as well as LDP secretary-general in Prime Minister Fumio Kishida’s cabinet.

In 1999, policymakers again revised the Worker Dispatching Act in response to Keidanren’s suggestions. Prior to the revision, the law had stipulated 26 types of jobs that companies could fill with dispatch workers, including interpreting, research and development, and presenting. However, the amendment allowed companies to fill any type of job with dispatch workers, in principle. It specified “in principle” because, at the time, manufacturing and construction jobs and the like were exempted.

However, workers opposed the move and held frequent protests and sit-ins around the National Diet building.

It appeared the LDP government was on the side of corporations, not workers. On June 10, 1999, it made its stance clear in a session of the Diet upper house committee on labor and social affairs.

The National Diet Building. Photo by Makoto Watanabe.

In a question to Labor Minister Amari, Japanese Communist Party member Tadayoshi Ichida proposed prohibiting corporations from hiring dispatch workers for one year after laying off full-time employees as part of company restructuring, to prevent full-time employees from simply being replaced by non-regular workers.

Labor Minister Amari replied, “It is not appropriate to impose such a ban on a company implementing restructuring because the company would not be able to accurately respond to the needs of workers who wish to be dispatched to that company, and because it could hinder the restructuring of the company’s business.”

Ichida questioned whose side Amari was on — workers or corporations?

Amari: “Naturally, such companies must have the chance to fight it out through their business strategy, and the fact that certain means can be used effectively is of course part of a company’s logic, so there are such reasons for job-seekers and for companies…”

Ichida: “We are running out of time, so please be concise.”

Amari: “Certainly. I think it’s true that a ban [on dispatch workers] would be an obstacle for companies in terms of rebuilding their business.”

Top 50 companies by donations to the National Political Association (recipient of donations for the LDP) in 1999

	Company name	Total(JPY)
1	TOYOTA MOTOR	62,000,000
2	SHOKOKUSHA Publishing	50,000,000
3	Nippon Steel Corporation	30,000,000
4	TOSHIBA	29,640,000
5	Matsushita Electric Industrial	29,640,000
6	Honda Motor	26,400,000
7	NISSAN MOTOR	25,400,000
8	TOYO CONSTRUCTION	23,762,000
9	SUZUKI MOTOR	23,700,000
10	Sony	23,000,000
11	Hitachi	22,800,000
12	ITOCHU Corporation	22,400,000
13	MITSUI & CO.	22,400,000
14	Mitsubishi Corporation	22,400,000
15	OBAYASHI CORPORATION	22,277,000
16	TAISEI CORPORATION	22,277,000
17	Suntory	22,036,000
18	Nishimatsu Construction	21,061,000
19	TODA CORPORATION	19,861,000
20	Mitsubishi Motors	18,400,000
21	Mitsubishi Electric	18,200,000
22	TAKENAKA CORPORATION	17,977,000
23	Nippon Life Insurance Company	17,690,000
24	Kajima Corporation	16,327,000
25	Kumagai Gumi	16,325,000
26	Shimizu Corporation	16,277,000
27	KONOIKE CONSTRUCTION	16,082,000
28	SANKYO	15,810,000
29	Daihatsu Motor	15,500,000
30	Fuji Heavy Industries	15,500,000
31	Takeda Pharmaceutical Company	15,480,000
32	Sumitomo Corporation	15,200,000
33	Sumitomo Metal Industries	15,000,000
34	Kawasaki Steel Corporation	15,000,000
35	Kobe Steel	15,000,000
36	NKK	15,000,000
37	DAIHO CORPORATION	14,863,000
38	KANDENKO	14,850,000
39	Okumura Corporation	14,062,000
40	PENTA-OCEAN CONSTRUCTION	14,061,000
41	MAEDA CORPORATION	14,061,000
42	TOENEC CORPORATION	14,000,000
43	KINDEN CORPORATION	14,000,000
44	DENSO CORPORATION	13,700,000
45	Hino Motors	13,500,000
46	HAZAMA ANDO CORPORATION	13,462,000
47	IHI Corporation	13,290,000
48	MAZDA	13,000,000
49	Yamanouchi Pharmaceutical	12,650,000
50	Sumitomo Mitsui Construction	12,462,000

Note: Amounts do not include contributions by group companies or subsidiaries

(Originally published on September 28, 2024.)

Buying Policy: All articles