The dark side of Karoshi — Japan’s culture of overwork could be dragging down its economy

We previously talked about Japan’s current economic outlook on this blog. While Abenomics seems to provide a sustainable path to solving some of Japan’s current economic problems, it appears other difficulties are being if not neglected, picked up gingerly at best. Karoshi, the Japanese word for job-related death, describes the practise of working until total physical and psychological exhaustion, culminating in a fatal stress-related disease or suicide in an alarming number of cases. In this post we will try to connect some figures to the losses in the Japanese economy connected with Karoshi.

With awe and sometimes a questionable voyeuristic tendency, western newspapers and online bloggers gaze at a Japanese phenomenon that to them seems very puzzling: Japanese employees working up to 100 extra hours per month, taking rarely any days of vacation and working several weekends in a row — often without payment. From a western point of view, with all our focus on the individual, on the achievement of personal goals and talk about work-life balance, this seems like the worst nightmares of a trade unionist come to grotesque life. To top it off, many Japanese employees divulge their pride in working long hours and in totally committing to their company’s goals. A good many of them might even consider doing anything less to be an embarrassment to their self-esteem.

Harmony is everything

This difference in work culture between East and West must astonish. Yet it is deeply rooted in Japanese culture and individual upbringing to attribute an extremely high value to the respective group to which one belongs . About two thirds of pupils in the Japanese education system learn in so-called Jukus or “cram schools”. In these private tuition schools they work many hours after school in order to be able to pass the difficult entrance exams to the next level of school — even when entering kindergarten. Besides that, there are voluntary Gasshuku studying groups that seek to create a sense of community by strengthening learning from each other. In this ideal of education with Confucian roots, not the gifts of the individual count, but his genuine effort for the group.

When students enter professional life, in broad parts of the economy the very same is expected of them: to fit perfectly into the group, to respect given authorities and seniority all the time and to value the interests of the firm at the highest level. Many companies in turn do their share to accommodate their devoted employees: Your son wants to go to Australia to improve his English? We’ll pay for that. You are in need of day care for your elder parents? No problem. If you don’t perform well, you will be placed in a less demanding position within the company. Of course you are expected to participate from time to time in company sporting events, take part in Nomikai, the ritualistic after-work get together with lots of alcohol and once a year spend a weekend with your family and your co-workers at the company cottage. Readers may now not be in any way considering damage done to economic performance by a work culture, which strongly values effort over productivity and results. To some this might seem like a harmonic, maybe even serene model of professional life.

Seppuku culture

But there is a dark side to it as well. Following the cultural tradition of Tatemae (things that should be) and Honne (things that really are), ideals of sincere effort in order to belong to a caring group and valuing the group’s interests above everything else develop a tragic pull when influenced by modern capitalism. Total commitment then may very well mean real, total commitment: never going home before your superior has left the building even if it is already late at night. Beginning your trip to work at five in the morning and trying to get the last train to commute back home. Taking no more than five, maybe eight days of vacation a year. Working long hours — and whole weekends — while faking the time sheet in order to make them fit to existing labour law. Reports indicate, this practices not only happen in SMB’s, but also in big companies like Mitsubishi or foreign-owned firms like McDonalds. About 22.7% of people in a 2016 survey stated they worked at least 80 hours of overtime a month, implying every fourth employee currently has a serious health hazard due to overworking. Thousands of people, many of them in their twenties or thirties, die every year of stress-related diseases like heart failure, heart attack, or stroke. When considering the estimated number of unknown and hushed up cases, stress-related suicides may be comparable.

“I want to die.”…
“I’m physically and mentally shattered.”…
“It’s 4 o’clock. My body is trembling … I just can’t do this. I’m gonna die. I’m so tired”.

Posts on Twitter of 24-year-old Matsuri Takahashi, preceding her suicide at Christmas day 2017 after several months with over 100 hours of overtime

Some figures

The amount of suffering for the families affected by Karoshi is not quantifiable. The damage done to the Japanese health care system on the other hand might be roughly outlined: according to the OECD, Japan’s total health spending accounted for 11.2 percent of its GDP in 2015, ranking third out of 35 OECD members. By 2035, health care’s share of GDP is expected to roughly double under the influence of demographic change. The burden to pay falls on the state, which bears the costs of about two-thirds of the medical bills.

While Japan still has the longest company affiliation in the world, on the other hand about 40 % of the workforce is now being employed as temps. The pressure amongst these precariously employed to perform in a race to demonstrate one’s commitment is difficult to imagine: temps are being payed about 30 % less and through their massive employment they finance the general avoidance of culturally ill-reputed job-cuts. Since Japan is also facing massive demographic effects with the fastest ageing population of the world, the country’s blatant problems with adopting and asserting any sufficient employment laws becomes even more problematic.

In March 2017, Shinzo Abe talked about a breakthrough in the prevention of Karoshi: His government had negotiated an agreement with labour unions and employers’ associations to limit the amount of allowed monthly overtime at “under 100 hours”. The “great and historical reform” (quote government spokesman) further intends to limit the yearly long hours at 720 maximum, which would imply 60 hours per month on average. Before, only the weekly standard working time of 40 hours had been legally fixed — any amounts of overtime were protected though a loophole.

Abe’s initiative for his workforce reform presumably has not grown out of empathy alone; his “Abenomics” program needs a populace capable of consumption too. Since February 2017 the initiative “Premium Friday” promotes finishing work early at the last Friday of the month in order to go shopping. The expected increase in consumption as result of the initiative is estimated to boost GDP by JPY63.5 billion ($570 million) a year. By now it seems clear it isn’t working: only 3.7 percent of Tokyo area employees left early to profit from the launch offerings and the interest to leave early remains very low so far.

The future of Abenomics is seen to increasingly depend on the success of labor reforms: “There are still doubts about whether we can change our culture, lifestyles, and long-established labor practices,” Abe said in late March. “But I’m confident that the year 2017 will be remembered by future generations as a starting point for Japan’s labor reforms.”

Ways to consolidation

It shows that the future of Japan’s economy cannot depend solely on half-hearted governmental incentives which do not really tackle forces originating in people’s upbringing, public culture and individual self-esteem. There are no miracles to hope for coming from the economic sector either: While some companies resort to shutting off the lights in their facilities at 10 p.m., others have started to pay incentives for employees coming to work between 5 and 8 a.m. All of this circular misery happens in a context of remarkable unproductivity: in GDP per hour, Japan was ranked 20th in the world by the OECD and lowest of the G7 countries.

Considering the above mentioned circumstances, Shinzo Abe’s concern for the Japanese work culture comes as no surprise. Low private consumption, relatively low productivity, quickly ageing populace, rising costs for healthcare and social security and a restrictive immigration policy footed on an ideology of cultural identity create a vicious cycle. All of these problems are directly or indirectly connected with the organized and culturally enforced abuse or self-abuse of Japanese employees. These employees are going to become an increasingly rare means of economic survival in the future, especially as the Japanese seem to muster a stubborn defence of culturally untenable positions. If the change of work culture, rooted in an ancient system of valuing the needs of the group higher than one’s own, doesn’t come faster and soon, healthcare excesses and economic losses will inevitably follow — as well as thousands of further personal tragedies.

Japan needs to understand its cultural heritage within the context of its time. To achieve that, it wouldn’t need to let go of its traditions, but get to know their potential for adaptation to the realities of today. A modern philosophy of Bushido might come to reason, that more individuality, less working time and a stronger focus on private life may serve the aims of one’s group much better than total commitment coupled with a manifold loss of self.

After all, the following lines can be read in the context of Karoshi as well as in a different one, which promotes facing reality for what it is:

Bushido is realized in the presence of death. In the case of having to choose between life and death you should choose death. There is no other reasoning. … We all want to live. And in large part we make our logic according to what we like. But not having attained our aim and continuing to live is cowardice. … This is the substance of the Way of the Samurai. If by setting one’s heart right every morning and evening, one is able to live as though his body were already dead, he gains freedom in the Way.

Hagakure, Samurai code of honor



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Global & European Dynamics

Global & European Dynamics

Our mission on this blog is to shed light on Europe’s role in the world economy.