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Economic inequality has rapidly increased in many countries in recent years. However, there are few reports of a significant increase in wage inequality in Japan. Thus, this study focuses on employment status as a factor contributing to the rising wage inequality in Japan and clarifies the impacts of the increase in non-standard employment and changes in the wage structure due to employment status on recent changes in wage inequality by distinguishing between wage structure and composition effects, while also considering factors other than employment status. We used decomposition methods to individual data from the Employment Status Survey (1997, 2007, and 2017) separately for men and women to estimate the factors contributing to changes in wage inequality. The study found that the quantitative expansion of non-standard employment since the late 1990s and the increase in the earning power of female non-standard employees have changed wage inequality. For men, an increase in the number of low-wage workers (non-standard workers) expanded the left end of the wage distribution, which resulted in increasing inequality. For women, wage inequality increased because of the composition effect of non-standard employment and decreased because of changes in the wage structure by employment status. Since non-standard employment lowered the wage level in the middle of the distribution for women, an increase in non-standard employment widened the gap in the middle to upper levels of the wage distribution. However, compared to 1997, the effect of lowering wage levels because of non-standard employment weakened in 2007, and wage inequality decreased. This change can be attributed to the qualitative shift from non-standard employment to the core labor force.

Keywords: Recentered influence function (RIF) regressions, Oaxaca-Blinder (OB) decomposition, changes in wage inequality

Many industrialized countries have experienced increasing wage inequality and the erosion of collective bargaining systems since the 1980s. Although several studies have revealed how unions affected trends in wage inequality in western countries, little is known about their effects in Japan. This study examines whether and how unions affected trends in Japanese wage inequality for male employees between 1985 and 2015. Using data from the Social Stratification and Mobility Survey (SSM) conducted in 1985 and 2015, we conducted Recentered Influence Function (RIF) regressions on the natural logarithm of wages and an extension of the Oaxaca-Blinder decomposition method that can be applied to various distributional measures. We found that unions compressed the wage distribution in 1985, but not in 2015. Unions also contributed to the changes in wage distribution over this period, and composition effects linked to unions (the impact of de-unionization) increased wage inequality. On the other hand, the effects of unions’ wage structure reduced inequality at the low end of the distribution. In 1985, union membership increased wages at the low-end and middle-end of the distribution and lowered wages at the top-end of the distribution, effectively widening the wage distribution at the low end-and equalizing the wage distribution at the top-end. However, in 2015, unions could no longer impact wages. Although this wage structure effect contributed to reducing wage inequality at the low-end, this study concluded that the impact of de-unionization on increasing wage inequality was more robust than the unions’ wage structure effect.

Keywords: Unconditional quantile regressions, Oaxaca-Blinder (OB) decomposition, erosion of the Spring Wage Negotiations (Shunto)

This paper analyzes the characteristics of clients, their support needs, and their evaluation of support services, using data from a questionnaire survey and an interview survey targeting clients of the Toyonaka City Self-Reliance Support for Needy Persons. The analysis revealed the following two points. First, the clients had diverse backgrounds and were impoverished during the COVID-19 pandemic, and they relied on “government and local counseling agencies and support staff” instead of family and friends. Second, the clients with complex problems perceived the experience of acquiring a “dependable person” other than family and friends (“institutional weak ties”) as a “safety net”. Additionally, this experience encouraged the clients to keep moving forward, even if their problems were not resolved. This result indicates that “accompanied support” is practiced at the counter of the Toyonaka City Self-Reliance Support for Needy Persons, and that this leads to clients’ high evaluation of support services.

*Note
The purpose of Self-Reliance Support for Needy Persons, which has been launched in 2015, is to promote self-reliance by providing support according to individual circumstances to those who are economically impoverished and may not be able to maintain a minimum standard of living.
Municipalities are the main implementers of the system, and there are two types of support services: the consultation support for the needy (mandatory service), which provides comprehensive consultation and support to a wide range of needy persons with complex problems, and each support service (optional service), which provides support according to the situation of each person. Various types of support are provided based on the support plan for needy persons formulated by the consultation support organization.

This article provides an overview of Japanese labor studies conducted since the 2000s; it particularly focuses on studies dealing with women’s work and non-standard employment. By reviewing these studies, the article aims to show how the Japanese employment system creates and maintains economic disparities between men and women and between different employment statuses. First, a review of the literature on women’s labor indicates that the Japanese employment system is discriminatory toward women. Specifically, the article finds that Japan’s long-term employment and seniority-based systems are preventing women from developing their careers. Next, the article reviews research on non-standard employment with a focus on disparities between standard and non-standard workers and explains how differences in human resource development policies have created and maintained large discrepancies between employment statuses. Therefore, the study concludes that the established Japanese employment system causes large disparities between men and women, and in employment statuses.