If Britain was once a nation of shop-keepers, postwar Japan was a nation of office workers: an egalitarian hive of hard-working, well-paid, white-collar drones, where prosperity was shared by all, not just an opportunistic, entrepreneurial few. Now, as the country’s sacred cows of jobs for life, seniority pay and secure pensions are steadily culled, Japan’s cherished ideal of social equality is also fading.
More than a million Japanese now receive state welfare assistance, and the unemployment rate, currently 5 per cent, hits a new high each month. The sacked “salarymen” have long stopped trying to hide their plight from friends and neighbours by dressing each day for the office and leaving home with their lunch boxes. They have joined the shushoku nanmin, the long-term unemployed.
“While the middle class in Japan is definitely larger than in most other countries, the sides to this block are much steeper,” says Charlie McJilton, a representative of Food Bank Japan, a non-governmental organisation formed last year to reach Tokyo’s hungry and homeless. “In other words – as many Japanese are finding out – once you fall off, it is virtually impossible to get back on because there is no safety net.” Those working in the voluntary sector in Osaka, Japan’s second city, estimate that the metropolitan area’s homeless number about 15,000, three times the official figure. As much as 80 per cent of them may have once worked in the construction industry which, after a government pledge to slash the extravagant level of public works spending, now faces further cutbacks.
Others remain within society only nominally. According to an official study published last month, two and a half million Japanese are “heavy” consumers of alcohol. Suicide attempts are on the rise. Calls from men in their thirties and forties to the Inochi no Denwa lifeline have almost doubled in the past year.
The very forces pushing some to the bottom of the heap, however, are raising others up. The process of unwinding Japan’s economic tangle, argues Brian Bremner, Tokyo correspondent for the US financial journal Business Week, “will create new winners and losers in the economy and, by extension, lead to more divergent income levels”.
Japan’s concentration of wealth – held by a class of super-rich aristocrats and zaibatsu families who controlled mono-polistic conglomerates – was exactly what US occupation forces sought to break up after the Second World War. Yet while living standards did indeed level out for the workers below, much of this tiny elite adapted and survived, swapping monopolies and titles for competitive capitalism and real estate. Zaibatsu names are still with us today: for example, Mitsubishi, Mitsui, Sumitomo, Nissan, Nomura.
Younger scions are joining the ranks of the privately wealthy through the sale or optioning of family companies, creating new millionaires, if no new wealth. And while the postwar generation that created such fortunes felt it patriotic to channel its money back into the nation through taxes and often crippling estate duty, the heirs disagree, and utilise funds and trusts to hold on to their cash.
Dynastic wealth accounts for a significant proportion of Japan’s billionaires – who are in number, according to Forbes Magazine‘s most recent listing, second only to those of the US. However, there is also an emerging entrepreneurial and hi-tech superclass. The techies’ wealth is volatile (14 dropped off the Forbes list this year), but others are building empires that look set to stay the distance. They include Tadashi Yanai, the founder of Fast Retailing, the parent company of the Gap-style, no-frills clothing chain Uniqlo, which is due to open 50 shops in the UK over the next year. The company balance sheet already stands at a cool $9.4bn, and Yanai’s personal portion, in the form of share options, amounts to $5bn.
Moreover, overseas firms, banks and trading houses, offering fat-cat salaries and bonuses for elite employees, are producing seven-figure salarymen. Even as home repossessions rise, luxury condo developments are booming. Mitsubishi Estate’s 33 Shiodome “sky houses” (priced from £1.25m upwards) sold out on the day of offering. Car wars rage between Toyota and BMW over top-of-the-range models, while £300-a-night hotels boast occupancy rates of more than 90 per cent.
In the meantime, “benefit realignment” is threatening to leave those who are dependent on welfare with less than ever before. There are already huge inequalities among Japan’s elderly – with some enjoying fat corporate pensions while others, such as ex-labourers and factory workers, have almost nothing – and these seem set to increase. It is a pattern familiar to many other countries, particularly Britain and the US. But few societies are being as profoundly reshaped by the growing gulf between rich and poor as Japan.
The Koizumi government’s crusade to clear up bad bank loans, a move applauded around the world, is forcing inefficient businesses to the wall. Yet it is often the smallest-scale ventures that pay the price: cottage industries, small factory work and local stores. While Sogo, the bankrupt department store chain, was hauled back on to its feet by investors and cautiously reopened for business last month, cottage crafts such as futon- or tatami-manufacture have no second chance. Redundancies are minimal compared to those brought about by the collapse of corporate giants, yet jobs are the least of the losses incurred: artisanship and local communities are vanishing irrevocably.