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Determinants of Structural Adjustment and Employment Use in Japan: Firm Characteristics, Offshoring and Industrial Robotics

Author

Listed:
  • Timothy DESTEFANO
  • Sho HANEDA
  • Hyeog KWON

Abstract

The following paper examines the determinants of structural adjustment in Japan. Unlike many other developed economies, firms in Japan rely more on changes to employment composition than mass layoffs as a method of structural change. Examining the drivers of changes in employee composition in Japan is therefore of interest to policy makers and academics alike. This research uses a novel plant-level dataset, which contains considerable detail on the types of employees used by Japanese manufacturers between 2001 and 2014. The results find a number of countervailing factors that explain the use of certain employment types. Growth in the diffusion of robotics is linked to the use of fewer non-regular employees. This appears to be partially driven by the fact that these machines positively predict the dismissal of certain types of non-regular workers. Offshoring from Japan leads to the use of a higher proportion of non-regular to regular workers, potentially due to increased competition faced by plants from abroad. Plant productivity however leads to the use of more regular to non-regular workers. Finally, establishments which experienced job dismissals in the past are substituting away from regular to non-regular workers in the present.

Suggested Citation

  • Timothy DESTEFANO & Sho HANEDA & Hyeog KWON, 2019. "Determinants of Structural Adjustment and Employment Use in Japan: Firm Characteristics, Offshoring and Industrial Robotics," Discussion papers 19067, Research Institute of Economy, Trade and Industry (RIETI).
    • Handle: RePEc:eti:dpaper:19067
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    References listed on IDEAS

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    Cited by:

    1. Masayuki MORIKAWA, 2020. "Heterogeneous Relationships between Automation Technologies and Skilled Labor: Evidence from a Firm Survey," Discussion papers 20004, Research Institute of Economy, Trade and Industry (RIETI).
    2. Dekle, Robert, 2020. "Robots and industrial labor: Evidence from Japan," Journal of the Japanese and International Economies, Elsevier, vol. 58(C).

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