The curse of the salaryman

The May editions of Salaryman and Enterprising Japan are cutting-edge commuter fodder: profiles of star CEOs jostle with critiques of low interest rates, lampoons of office life and a guide to business buzzwords. Adverts peddle craft beers, high-tech watches and electric massage machines to Japan’s stressed but trendy white-collar drones.

The magazines, though, are from 1936 when moustaches were virtually required work attire and staplers were marketed as the killer business gadget.

But the modern salaryman — that globally recognised stereotype of overworked, group-thinking, duty-burdened Japan — is clearly recognisable in their yellowing pages. He has now been around for 100 years and his longevity, argue some, is a national disaster. The salaryman ideology served the country well in its boom years, but for a country facing zero growth “it is terrible”, says Haruo Shimada, president of the Chiba University of Commerce.

To Enterprising Japan readers, and for many decades after the second world war, the white collar salaryman was a glorious, indefatigable, all-conquering economic hero. His loyalty, labours and loves defined a nation that selected — first by expediency and later by habit — the company as the dominant institution. Corporate, social and family life in Japan spun in enthralled orbit around his work ethic, his expense account and the ideal of lifetime employment. Men wanted to be him; women wanted to marry him, bars wanted to serve him whisky till 2am and ambitious corporations wanted as many of him as they could grab.

But in 2016, the salaryman — unassertive, allergic to risk and with a growing list of corporate debacles to his name — has switched from asset to liability. To economists who see labour market reform as Japan’s only hope, it ranks among the country’s most insidious threats. The identity of a lot of Japanese men working in offices is tied to group think and respect for authority, says Koichi Nakano, a political scientist at Sophia University in Tokyo. “It is the very opposite of the creativity and original behaviour that the economy needs at this point,” Prof Nakano said.

To Prime Minister Shinzo Abe, struggling to give his “Abenomics” growth policies any long-term traction and declaring last month that his biggest challenge is “to reform the way Japan works”, the salaryman presents a potentially insurmountable roadblock, say scholars and financial analysts.

Surprisingly, there is agreement on the ground. “I guess you could say that we are non-creative at work and at home,” jokes Mr Ogawa, an unmarried 41-year old logistics company executive drinking in Tokyo’s Ikebukuro district with two recent recruits.

“We don’t seem to be growing the economy and we don’t seem to be increasing the population. But I won’t be negative. I have to encourage these two to work hard,” says Mr Ogawa, who asked that his first name not be used.

For Japan to grow at a pace that can support gross government debt at about 250 per cent of gross domestic product and offset a societal greying that will see one pensioner for every two workers by next decade, it needs innovation, productivity gains, better deployment of risk capital, greater promotion of women and more structural reform.

The permanently employed salaryman, embedded in a single company, representing a majority of the white collar workforce, ringfenced by corporate instinct and bound into seniority-based progress, will not only fail to deliver any of those, say experts, he will actively resist them.

What Japan primarily needs is a liquid job market with mid-career movement, says Mr Shimada. The salaryman, his basis for existing eroded, will ensure it does not get one.

“In the context of Abenomics, the concept and practices of the salaryman are very bad. Forty years ago, Japan’s aggregate productivity was one of the highest, now it is very low and the reason is that they are paid for their time. We know the problem, but we just cannot get out of these stringent traditions,” says Mr Shimada. “Abe faces huge resistance: he has done about a tenth of what he set out to do.”

Worth the sacrifice?

Criticism of the salaryman is increasingly overt, and is most potent coming from the salarymen themselves. There are two lines of attack. One is from an older generation that has scraped unhappily through successive rounds of restructuring and now questions whether a life of hard work, punishing late nights and what amounts to a pledge to neglect one’s family was really worth it. The other is from the incoming generation that likes the idea of stability, but sees the sacrifice as a terrifying anachronism.

“I did the whole recruitment process, so I knew this would happen, but I cannot really believe that I am a salaryman now. I know what the culture is, but I don’t know whether I can live in it,” says one of Mr Ogawa’s charges, lowering his voice while the boss visits the gents.

Perhaps the most searing condemnation of the salaryman, though, comes from Hiroshi Motomiya, a manga cartoon artist whose creation, Sarariman Kintaro, has been among the most cherished heroes of the commuter masses for 20 years. The weekly exploits of the white collar protagonist appear to lionise the salaryman.

“The salaryman is a slave,” counters Motomiya, who says he can unleash criticism in cartoons that he could never state in public, “and the salaryman system is destroying this country. There is lots of duty but no responsibility. They are inward-looking. They just dig in and then try to destroy anyone who stands out.”

Salaryman culture is increasingly the object of public scrutiny as corporate scandals erupt and labour disputes rise. In the scandals at Toshiba, Mitsubishi Motors and Asahi Kasei, where it emerged that data on accounts, emissions and building foundation piles were faked over many years, the failure of the salaryman was laid especially bare. His skewed loyalty to the company and fear of internal authority comes at the clear cost to the customer and to society says Katsumi Hara, a professor at Waseda University who has studied the history of the salaryman.

For many observers, Fukushima was the tragic consequence of a nation that had trusted its fate to the hands both of salarymen and the bureaucrats who have come to behave like them.

‘From fighter to sheep’

Even the Bank of Japan, with the monetary taps wide open and deflation still a challenge, may be losing faith in the salaryman as a source of consumption.

Since the mid-1990s, full-time employee wages have been virtually stagnant: average wages at 219 large firms in the Keidanren business lobby — the fortress of the salaryman — rose just 0.44 per cent between 1995 and last year. In a humiliating revelation last summer, Shinsei Bank, which tracks 40 years of data on the monthly “pocket money” given to salarymen by their wives, calculated that allowances have fallen to their lowest levels in 33 years.

Predictions of the end of the salaryman flare every time the economy surges or slumps, says Prof Hara. Within the past 15 years alone, he says, people have confidently declared the demise, rebirth and re-demise of the salaryman.

“The real focus should be on the way he has turned from what was once an independent-minded, entrepreneurial fighter into a sheep,” he says.

But even with their swagger long gone, they may prove hard to dislodge. Later this year, when Mr Abe has put the G7 summit and parliamentary upper house elections behind him, he is expected to have another crack at encouraging companies to adopt more productivity-based pay — a move that would potentially transform Japan’s labour market and force companies and society to evaluate work by something other than the hours worked.

Companies are able to get away with only using that metric, says Machiko Osawa, a specialist on labour economics at Japan’s Women’s University, because the whole national set-up — the expectation that women will not work so they can support families, the acceptance that employees are slaves to their employers — has been built around it.

“Productivity-based pay stands against the salaryman culture, and so does a liquid job market where people are able to walk away,” she says “Salarymen do see the inconsistencies but they can do nothing, so they are depressed and overworked. Organisations will keep their salaryman mentality in spite of government policy: only liquid job markets will make people less salaryman.”

Mr Abe tried this in 2015 but made little headway. Few think it will work this time. The trade unions and the business lobby are aligned against productivity-based pay and the combination is formidable.

Whatever reforms Mr Abe attempts, says Prof Osawa, the salaryman and his attempts to protect his position will be the nendosou — the claggiest layer of soil that snarls the plough and halts progress. Demographics have made it even more entrenched.

As the dynamic, entrepreneurial founders of the companies that rose from the ashes of the second world war have retired, they have left in charge a generation of “salaryman CEOs” — executives who have only worked for a single company and whose careers have often been a masterclass in risk avoidance. These are not shrewd investors or promoters of innovation, say analysts.

“There are some new companies in Japan that talk about diversity, innovation and new ideas, but in that context, the salaryman stands against those things. They follow orders, they don’t propose new ideas, they apply rules simply to avoid the mistake of not applying the rules. And they do that without once considering whether those rules have any meaning or impact on productivity,” says Prof Osawa.

Along with a few others, however, Prof Osawa does see some room for optimism, particularly where a decline in salaryman culture would give way to greater opportunities for Japan’s persistently under-promoted female workforce.

Long years of low wages and the momentum of Mr Abe’s “womenomics” rhetoric means that Japan is on the verge of transferring to a dual-income society. That leaves no room for the all-consuming salaryman life, and society will adapt to a new norm, she says.

Motomiya, doodling another picture of his hero Kintaro inside a book cover, is not convinced. “The future of a Japan made by and for the salaryman is going to face a lot of hazards,” he says.

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Outdated, but the salaryman system persists / From Ayako Saiki