Generational Diversity in the Japanese Workplace

by Alicor Panao, Editor-in-Chief, The HR Agenda

The term “generation gap” can mean different things to different people, including meanings that are not always very flattering. Commonly, it is used as a glib explanation for the seeming mismatch between adult expectations and youthful behavior in an organization, including the workplace. But is there really an eternal conflict between generations? And are Japanese youth really altering the structure of the Japanese workplace (and perhaps even society as a whole)?

Understandably there are rhetorical gaps in the issue and arguments thrown in the debate range from oversimplification to those that echo views by social psychologists, anthropologists, and sociologists.

Today’s generation of Japanese workers are seen as passive, apathetic and not as ambitious as their counterparts from Japan’s so-called miracle economy. The youth’s tendency to shy away from adult commitments such as marriage, raising a family, childbearing and financial independence only compound such perception. Nowadays, young people are categorized either as “freeters,” or parasite singles who mostly rely on their parents for support—labels that may be overly exaggerated but admittedly capture the realities of today’s Japanese youth.

Humor has also eluded today’s generation of workers. Nikkan Gendai in a September 2010 report (citing a poll by research and PR company iShare) said 43 percent of workers in their 20s and 40s never engage in genuine laughter in the workplace. Moreover, a breakdown of age brackets shows that the tendency for laughter falls as workers get younger.

It could be because in truth there is really nothing to be happy about as far as the current state of economy is concerned. Unemployment, wage deflation and job market insecurity are all at record levels. In fact, it can be said that the attitude of today’s youth merely reflects the national mood. According to the Japan Productivity Center for Socioeconomic Development, people in their 30s account for six in ten reported cases of depression, stress, and work-related mental disabilities. It may sound strange at first why young people end up to be the global recession’s biggest losers. The law of supply and demand should tell us that companies ought to prefer younger, easily dispensable workers over older expensive workers. But with the uncertainties of the market, companies themselves are taking as little risk as possible and are being extra careful when it comes to hiring workers. Hence, they rarely even bother to look at the resume of new graduates.

Young people, in response, have become more conservative about employment due to concerns about future job security. Contrary to the perception the youths being workplace trendsetters, for instance, an April 2010 survey by the Japan Management Association showed that about half of newly hired workers prefer seniority-based companies to merit-based firms, an increase of 8.6 percentage points over the previous year’s survey. The survey also found that half of new workers want to remain with their current employers until the age of retirement, up 6.9 points from the 2009 figure and almost double the 2006 ratio of 27.2 percent. Today’s generation of workers, in other words, prefer the traditional seniority-based system, as their counterparts did two or three generations ago. The death of lifetime employment may have altered the career path of many Japanese workers but what is apparent is that the sentiments of the young are no different from the old when it comes to employment security.

Some argue the young prefer to engage in multiple unstable work schemes. But in reality, the uncertain labor market has made it more difficult to rely on, or even find, one full time job. According to the Japan Institute for Labor Policy and Training, nine in ten young workers have second and third jobs to earn extra money. Extra income appears to be the main motivation for holding side jobs but some economists see this as a form of risk management especially for workers who fear losing their main jobs.

If it is any consolation, this phenomenon of an entire generation of youth being unable to find full time work is not a problem confined to Japan alone. The global slump has affected a range of young people from high school dropouts to college graduates, especially in the world’s most developed economies. In the U.S. alone, the unemployment rate for 16 to 24 year olds has reportedly risen to more than 18 percent in the last year. In fact, it is no longer uncommon to see fresh young lawyers and MBAs competing for the least likely of jobs with their less endowed counterparts.

To be fair, those from the older generation are probably just concerned about the young and whether they can actually manage to sustain the Japan that the next generation will inherit. As the economy tumbles up and down, there has also been a lot of age diversity in the work pool. In particular, people in Japan are retiring much later in life. Moreover, people are working years, if not decades past their age of retirement.

Fortunately, HR managers don't have to see age diversity as anything bad. In fact, in many progressive and forward-looking organizations, they are looking at age difference as an advantage that can give an organization a competitive edge. Diversity in age, for one, offers an opportunity to harness the insight of different generations and capitalize the attributes various age groups can bring to the table. Naturally, there would be gaps in terms of background and orientation. Older workers, for instance, are not as accustomed to technology as the younger generation. Undoubtedly, however, the older generation carries with them a great wealth of experience essential to run organizations. The experience of the old when pitted together with the orientation of the tech-savvy young, brings balance to the workplace.

The challenge, therefore, is to effectively balance managing age diversity and taking advantage of what each generation has to offer. Seen this way, yes, it is possible to close the generational gap. Organizations can start by encouraging teamwork while encouraging diversity at the same time.