Ogura Junpei is looking for a job after graduating from Japan’s Keio University. But he isn't interested in a career with one of the traditional job-for-life Japanese companies. Instead, Ogura-san has found more challenging work and better pay at a consulting firm and a foreign investment bank. "I’m not just looking for a job," explains Ogura-san, "but a place where I find it worthwhile to work."

Japan’s well-known psychological contract -- lifetime employment, steady advancement, and seniority-based pay increases -- is starting to fall apart. One reason is that Japan’s recent recession forced Honda, Sony, NEC, and other major corporations to introduce performance-based relationships that weakened job security guarantees. The other reason is that many younger Japanese employees want challenging work and better pay now, not after waiting a decade or more. "I’m suffocating from the rigid seniority system in my office," complains a young electronics engineer with a major Japanese company.

Not every young Japanese employee is abandoning the lifetime employment relationship. "Lifelong employment is suitable to the Japanese character," explains Kentaro Takahashi, a 23-year old engineering graduate. "From long ago, people donated their whole lives to the company. So we should give our full support to our new firm."

Still, restructuring in traditional Japanese firms and performance-based rewards in start-up and foreign businesses are changing the psychological contract. For example, hundreds of job seekers recently attended one of Japan’s first international job fairs where more than 50 foreign firms were recruiting. "The young urban Japan is already voting for change with their careers," says Kenneth Courtis, strategist and chief economist at Deutsche Bank Group in Tokyo.

Sources: M. Zielenziger, "The Fading Salary Man," National Post, April 5, 2000, p. C15; M. Mutsuko, "Who Needs Life Employment?" AsiaWeek, March 17, 2000; B. McKenna, "Restructuring Fever Sweeps Japan," Globe & Mail, May 29, 1999; M. Millett, "Jobs-for-Life Mentality Severely Restructured," The Age (Melbourne), May 15, 1999.