BLUE-COLLAR BLUES IN JAPAN
The rise in Japan's unemployment rate to a record 3.2% in March signals more than a pause in the recovery, contends economist Shigeki Sakaki of Nomura Research Institute America Inc. The economy now seems to be in the first stages of a significant downsizing of manufacturing employment.
Just a month ago, reports Sakaki, Japanese manufacturers indicated that they had cut costs enough to lower their break-even point to around 103 yen to the dollar. That's still far above the current exchange rate, so a lot more production seems headed overseas.
Whereas factory jobs as a percent of total Japanese employment stayed above 24% from 1979 through 1992, Sakaki notes that the share is now closer to 23% and falling. (The U.S. ratio is 16%.) The big question, he says, is whether hiring by Japan's nonmanufacturing sectors will be strong enough to mffset a more rapid erosion in factory jobs.BY GENE KORETZ