”The the pillars supporting the economic growth. However, one

”The
labour and management relationship itself is from the first a
relationship between one group of human beings and another group of
human beings. ” (Nakayama 1974, 121)
Japan’s
management is best known for three of its practices : lifetime
employment, seniority wage system, and its enterprise unions.
According to the 2010 Basic Survey on Labour Union, there are about
26.000 labour unions in Japan, with about 10 million peole being
affiliated to one. After reaching a record high of 55.8% in 1949, the
percentage of unionization stayed in the low 30% from the 1950s to
the 1970s, and after the oil crisis of 1973 and the belt-tightening
that followed, the increase of regular employees was curbed,
resulting in the rate to fall from 1975 to 2008. In 2009, partly due
to the growing unionization of part-time workers, the rate increased
slightly. The history of labour and management relations is
filled with turmoil, as Japan experienced a period of intense labour
and management disputes after World War II. These constant
confrontations eventually turned into collaboration during Japan’s
high economic growth period, and became one of the pillars supporting
the economic growth. However, one can wonder : has confrontation
or collaboration been more significant in Japan’s history of
industrial relations ? To answer this question, we will study
Japan’s labour and management relations throughout its history, to
explain how today’s labour and management relations are the result of
both rejecting and inheriting labour and management relations from
the period of high economic growth.

The
labour and management relationship, which is one of the most basic
social relationships in industrial society, appeared with the arrival
of the industrial sector. After World War II, Japan and Japanese
society fell into a state of despair and ruin. Its industries were at
about 30% of the prewar level, and people were starving. As a
consequence, the Labour Union Law was instituted in 1945, giving
official recognition to the formation of unions and their activities.
As workers were desperate and living in extreme poverty, they
developed intense labour movements, whose slogans were
”democratization of the workplace”, ”wage hikes”, or ”no
firings”, to protect themselves. At the time, management had
difficulties carrying out their activities, as a result of the
authorities of the Occupation Forces, who had ordered the dismanting
of the zaibatsu (financial
combines), or the purging of financiers from public offices. Under
those circumstances, labour and management both laid out their
claims, which resulted in intense disputes. In 1949, the Dodge Line1
was implemented, which resulted in a reduction in government workers,
mass dismissals in public corporations overseeing the railroad,
telegraph, telephone and postal services. As a result, about 490.000
workers were targeted by job reductions, and a great number of
workers lost their jobs because of bankruptcies in small and
medium-sized companies : this resulted in workers organizing
labour unions and going on strikes, and in 1949 the rate of labour
union organization reached its record of 55.8%. In 1950, the
Korean War started, which resulted in special procurements that
helped the revival of the Japanese economy. As austerity had been
forced upon them for so long, Japanese consumers were finally able to
purchase their lives’ necessities, to the point that it resulted in a
”consumption boom”, and in 1954, per capita consumption surpassed
the prewar level. However, this growth in consumption did not calm
labour and management disputes, and it was a time of one strike after
another (1951 Mitsukoshi Strike, 1952 Japan Federation of Coal Mine
Workers’ Unions Strikes ; All Japan Workers Union Strike ;
1953 Nissan Strike, Toyota Strike, Mitsui Miike Strike ; 1954
Amagasaki Seiko Strike, Omi Kenshi Strike, Nikko Muroran Strike), as
corporate profit begun to rise due to the business recovery, but
standard of living did not reach the halfway point of the prewar
level (Economic Stabilization Agency 1949, 44-45), and because of
massive dismissals due to rationalization. These disputes inflicted
great damage upon both corporations and workers, and had a huge
effect on economy. However, those conflicts were also the reason of
the birth of the labour and management relations of the high economic
growth period. Though the Japanese economy had recovered to
the prewar level by the mid-1950s, Japan’s per capita GNP was only
11% of the United States’, and it was behind developed countries.
Additionally, in 1974, Japan’s average export amount was 76% of its
import amount, its trade balance continued to record a current
deficit and as the country was not competitive in international
markets, it was put in an inferior position. At that point, economic
development was the most important task for Japan, but it was not in
the postwar period anymore, therefore it could not hope for the same
economic development that during the postwar reconstruction. For this
reason, modernization was the most important task. However, as labour
and management were always in dispute, they hindered the
modernization. In that sense, those long lasting conflicts were
damaging the economy, which is why both sides decided to look for a
way out, and in 1955 the Japan Productivity Center was established,
as well as the ”Three Guiding Principles of the Productivity
Movement”. Influenced by Commercial Service Officer Haroldson
of the U.S Embassy, the Japan Association of Corporate Executives
started to accept the ”productivity improvement movement”, and in
1954, four economic organizations (Keidanren, Nikkeiren,
The Japan Association of
Corporate Executives and the Japan Chamber of Commerce and Industry)
created the Japan-U.S Productivity Enhancement Committee, which later
became the Japan Productivity Center, a private sector organization
composed of people from labour and management, as well as academy
experts. The Three Guiding Principles of the Productivity
Movement were created : First of all, productivity improvement
ultimately increases employment. However, regarding excess personnel
arising transitionally, from the point of view of the national
economy, the government and the private sector shall cooperate to
devise appropriate measures, such as through as much as is possible
personnel redistribution and other ways to prevent the loss of
employment. Secondly, regarding specific methods to achieve
productivity improvment, labor and management shall cooperate to
study and discuss this, based on the circumstances of the individual
corporations. Finally, the various fruits of productivity improvement
shall be distributed fairly to managers, workers and consumers,
according to the actual conditions of the national economy. Those
principles became the model for the labour and management
relationship during the high economic growth period. Corporations
and workers have different goals : productivity improvement and
the securing of employment usually are incompatible, which results in
conflicts. However, both management and labour understood that
corporations grow through enlarging their business, which makes
possible the securing of employment by workers, and wages rise as a
result of fair distribution, therefore corporate growth also works to
improve the life of labour. This means that for workers to protect
their employment and improve their lives, the prosperity of their
corporation is necessary. From this realization started a
collaboration, as to reach their goals, labour and management created
a collaborative relationship built by using their conflict as an
opportunity to grow. It was a relationship where both labour and
management persisted in carrying their objectives and sought their
own growth, and tried to seek further growth in the long-term :
it was a collaborative relationship that included conflict and stood
upon it. At the time, productivity was a popular national movement,
and Japan did not have international competitiveness. Therefore,
labour and management understood that their continuous disputes were
an obstacle to modernization and despite different positions, they
both sought the growth of the Japanese economy. Industry based unions
therefore aggressively promoted the productivity improvement movement
and carried out educational activities to have to movement penetrate
into enterprise unions, and devoted themselves to improve workers’
lives by striving for industry cultivation and promoting the growth
of corporations. Those labour and management relations had a
great effect. For instance, the wages determined through the Spring
Labour Negociations were an important index, both for labour union
members and for small and medium-sized corporations, as well as non
organized workers. Business expansion was indispensable for a
corporation to maintain jobs, and market share expansion became the
priority. As Japan did could not compete internationally, the only
place Japanese corporation could expand was the domestic market, with
market creation. In order to achieve this, a fair distribution of the
pie was necessary, which would secure employment, wage hikes and life
improvement sought by workers. At that point, corporations and
workers stopped fighting for the pie at hand and aimed to expand the
pie itself, and placed priority on medium and long-term profits
rather than short-term, which led to intense competition and Japan’s
economic growth. Though there are still some disputes and
strikes, comparative studies of labour and management relations in
various foreign countries have been carried out such as those by
Abegglen (1958) and Dore (1973), and they found that labour and
management disputes in Japan are fewer in number particularly
compared to western countries, and unions and employers have formed
relatively cooperative relationships. Furthermore, the number of
labour strikes during the high economic growth period in 1965 there
were 3051 cases of strike, and 4551 strikes in 1970. However, there
were far fewer recently, with only 708 cases of strikes in 2005, and
612 cases in 2011. Moreover, the number of employees involved in
strikes has also declined with the high economic growth period :
there were 8.975.000 employees in 1965, 9.137.000 in 1970, it then
dropped to 646.000 in 2005, to be at 58.000 involved workers in 2011.
However, though there is far fewer strikes now compared to during the
high economic growth period, it doesn’t necessarily mean that
relations are satisfactory. Indeed, Japan is currently one of the
world’s leading economic powers, which is a very different
environment from the one during the high economic growth period. This
means that as the situation changes, so do social issues. Indeed,
there is currently a variety of problems at present, such as the
implementation of great numbers of early retirements as a result of
streamlining through rationalization, an unemployment rate not
dropping below 4% even in periods of prosperity, and real wages
falling after 1997. Furthermore, labour and management changed, and
today they are estranged labour and management relations, where the
results of the improvement of a corporation’s productivity are not
always returned to the workers, and corporate growth does not
automatically lead to an improvement in workers’ lives. We can
explain the fall in strikes with the fact that strikes are an
effective means of negociating when the economy is good, but they
actually please management if the corporate performance is poor.
Indeed, the decline in strikes is partly due to the fact that
relationships of trust between labour and management have improved,
and it has become possible to reach an agreement without resorting to
force in the form of a strike, but it can also be because of the
stagnation of the economy.

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Labour
and management relations were built by going through the intense
disputes of the postwar period. Indeed, tired from the fighting, both
eventually came to place priority on job stability and better working
conditions to protect the livelihood of workers, over ideologies that
sought political reforms. Through these disputes, pre-modern labor
management and violations of human rights seen in labour and
management were eliminated, leading to further democratization sought
by workers after the war. As a result, workers developed corporate
loyalty and awareness of the development of the corporation where
they were employed. Furthermore, although those disputes were each
corporation’s internal problem, they eventually started to spread
nationwide, as the social problems they were highlighting went beyond
the framework of one corporation. This made people realize that
corporations and labour unions were necessary players, which led
corporations and labour unions to become aware that they were social
institutions, and therefore they acted accordingly striving for the
developmentof the Japanese economy, as expected of them by national
consensus. Therefore, we can draw several conclusions. First of
all, in Japan’s labour and management relations’ case,
collaboration doesn’t come without confrontation : several years
of confrontations were necessary to come to agreements that resulted
in Japan’s growth, as both labour and management had to learn from
their past disputes to understand that their goals were linked to
each other. However, we can therefore think that all in all,
confrontation has been more significant in postwar Japan’s history
of industrial relations, as it was confrontation that gave the
impulse to seek a way out of the disputes, and led Japan to the
incredible economic recovery it is known for.