chapter  11
13 Pages

Institutional change in Japanese employment practices

Lifetime employment as fundamental continuity Two developments in Japanese employment practices have stood out since the turn of the century: the introduction of performance-related pay and the rise in non-regular employment. Both were mainly inspired by the ambition to reduce labour costs in response to the lost decade but structural developments such as the end of high economic growth and the ageing of the population would always have required an adaptation in employment practices. This shows in the fact that the tentative economic improvement after 2002 did little to alter the developments. Further alterations to the introduction of performance-related pay were minor and mainly implemented to increase flexibility and simplify execution. Moreover, the rise in non-regular employment has continued and even accelerated.