Japanese Work Style Reformation and its impact on Large Japanese Companies

Abstract

The labor shortage in Japan will be 6.4 million by 2030 due to a continuously declining birth rate and inadequate job opportunities for homemakers, retirees, and foreigners. The shortage will destroy the sustainability of the Japanese economy without prompt action. The Japanese government revised labor laws to let Japanese companies solve the future labor shortage. In 2020, large Japanese companies started following the revised laws. This paper analyzed the Japanese companies' reactions to the enforcement. Based on the analyses, we developed five suggestions that may be challenging but possible for Japanese companies to maintain competitive advantages and operational sustainability.