TT-618 -- Addicted to Chinese Trainees, e-biz news from Japan

* * * * * * * * * T E R R I E 'S T A K E * * * * * * *
A weekly roundup of news & information from Terrie Lloyd.

General Edition Sunday, June 19, 2011, Issue No. 618


- What's New -- Addicted to Chinese Trainees
- Metropolis Members Club winners
- News -- Consumer loans market shrinks by 30%
- Candidate Roundup/Vacancies
- Upcoming Events -- Next Entrepreneur Seminar
- Corrections/Feedback
- News Credits

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According to an article in the Japan Times on Thursday,
quoting numbers from a Labor Ministry report released
earlier in the week, there are now 2.02m people in Japan
receiving welfare checks, more than any time since 1952.
"Welfare" in Japan is apparently defined as financial
assistance offered by the government to a household when
its total income falls below the national minimum.

Presumably a big contributor to this record number of needy
people has been the Great East Japan earthquake in March.
The level of joblessness has soared to around 90% of
employable survivors in the worst hit areas, and by
the end of May about 110,000 were out of work and applying
for the dole at various Hello Work offices in Iwate,
Miyagi, and Fukushima prefectures.

So, one would think that with this excess capacity of
workers, many of whom are from the agricultural, fisheries,
and manufacturing industries, juxtaposed with the
phenomenon of disappearing Chinese trainee workers from
factories around the same regions, less than half of whom
are yet to return, that there would be a slew of local
hirings to make up the shortfall. Certainly after the
Chinese trainees fled the disaster areas, there were plenty
of news reports of employers grumpily saying, "We can't
trust Chinese employees, next time we'll hire locals."

But are they following through with local hiring offers?
Our guess is "not".

[Continued below...]

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The reason is because a Japanese breadwinner from Iwate on
unemployment, or even welfare, can still receive 2-5 times
more than the Chinese trainees do for the same jobs. The
factory and farm operators may grizzle about their
"unreliable" Chinese employees, but without this source of
ultra-cheap labor, they have no way of being able to
compete with the flood of goods and produce coming in from
China itself. The fact is that thousands of small companies
all over Japan are addicted to cheap trainee labor from
China and elsewhere, and to go local they would soon go out
of business.

Thus, unless the government comes up with some kind of
subsidy system, the folks in Fukushima will stay unemployed
and the missing trainees will be replaced with new trainees
just as soon as the recruiters in the remoter regions of
China can find them.

We have mentioned before in Terrie's Take (TT-399 --
Trainees or slaves?), foreign "trainees" in Japan are paid
a pittance. On average they make about JPY60,000 a month in
the first year, then if they are lucky, around JPY120,000 a
month for the following two years, after which they have to
return to their home country.

One of our readers alerted us to an excellent report just
put out this month by a Hong Kong labor relations think
tank called the China Labor Bulletin. The report is called
'Throw Away Labor -- The Exploitation of Chinese "Trainees"
in Japan' and is a encapsulation of the appalling
situation involving the virtual slave trade going on
between Chinese recruiters and small- to medium-sized
companies in rural Japan who need this cheap labor to

Get the report at:
It's a quick read.

The report chronicles the various miseries that Chinese
trainees experience once they get to Japan, including:
withheld wages, no or very underpaid overtime, withheld
passports, threats of law suits if they flee back to China,
unsanitary living conditions, extremely difficult working
conditions... well the list goes on. And of course it's
debatable whether such trainees actually receive any
education worth taking home with them.

The problem is that when you have poor and relatively
uneducated people from the Chinese hinterland making just
2,000 yuan per month (JPY26,000), almost anything sounds
better than what they have, especially when a recruiter
mentions Japan. The report details how trainees are
inveigled into a contract, and once committed, how they are
locked in to delivering that contract under very harsh (and
real) threats of legal action back in China.

This cheap labor addiction represents the reality of the
Japanese rural labor market. No doubt we'll see the media
highlighting how locals are landing construction jobs and
getting back on their feet -- that makes for feel-good
copy. But with only a comparatively small number of such
jobs going, there may well be a larger number of new
"trainee" visas being issued so as to ensure that
the rural factories and farms stay in business for a while

Our thanks to Geoffrey Crothall, Director of Communications
of the China Labour Bulletin for giving us permission to
quote parts of the organizations report.

...The information janitors/


Metropolis Members Club Winners

Congratulations to: Tanya Zminkowski who a pair of tickets
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Our Metropolis Members Club is growing by leaps and bounds
-- join now. No obligations, simply receive our weekly
email magazine and enjoy the Metropolis stories, discounts,
and prizes.


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+++ NEWS

- Japan ranks 4th globally for rule of law
- Suicides up in tsunami-hit areas
- Brand Off to IPO in Hong Kong?
- Nissan/JAF to offer EV roadside recharge service
- Consumer loans market shrinks by 30%

-> Japan ranks 4th globally for rule of law

A little tidbit that may surprise a lot of readers...
According to the World Justice Project, Japan is Number
Four globally and Number Two in Asia when it comes to rule
of law. The project measures each nation's justice
apparatus for effectiveness, security, transparency, and
some other factors. The report notes that Japan has a low
score in terms of accessibility and affordability.
Apparently New Zealand topped the asian region in the same
survey. (Source: TT commentary from's own website, Jun 14, 2011)

-> Suicides up in tsunami-hit areas

Although it is too early to predict an overall trend, it
appears from initial data that the rate of suicide by
post-tsunami survivors has jumped by 18%. Indeed, in Miyagi
the rate has soared to 39% over last year. A government
report is warning of a lot more cases of post-traumatic
stress coupled with grief and general depression. An
expert says that most people recover within 6 months of a
major event such as the tsunami but that 10% to 20% of
people need up to several years to get past the disaster.
(Source: TT commentary from, Jun 17,

-> Brand Off to IPO in Hong Kong?

Perhaps indicating a move to off-shore IPOs, the used brand
goods retailer, Brand Off, has said that it is considering
doing an IPO in Hong Kong rather than Japan. The company
got an early start in Asia and now has 9 stores in Hong
Kong and Taiwan. The company will earn US$51m in sales in
Hong Kong alone this year, and is planning to open its
first store in China, in Shanghai, in August. (Source: TT
commentary from, Jun 16, 2011)

-> Nissan/JAF to offer EV roadside recharge service

Nissan and the Japan Automobile Federation (JAF) have
teamed up to offer Nissan Leaf EV owners a service that
will ease the minds of many: a roadside battery recharge,
just in case you're unlucky enough to run out of juice
before getting home. No further details yet, but it looks
like JAF vans will be fitted out with rechargers that pump
enough power to get the customer's car to the nearest
recharge station for a proper top up. The Leaf has a 150km
range when charged for 7 hours from a 220V power connector
(at home), or it can be brought up to 80% capacity in just
30 minutes with a special 80V quick charger. (Source: TT
commentary from, Jun 15, 2011)

-> Consumer loans market shrinks by 30%

Well the efforts of the nation's courts to curb rampant
consumer loan companies and excessive interest rates seems
to be working. According to the FSA, unsecured consumer
loans fell about JPY3trn as of March 2011, versus a year
earlier. In particular, the number of people with at least
5 multiple loans fell 40% to 690,000 by May. Although there
were predictions of a surge in personal bankruptcies after
the new lending restrictions came into being, this does not
seem to have happened. Rather, the lending public have cut
back and learned to adapt to the new rules. (Source: TT
commentary from, Jun 18, 2011)

NOTE: Broken links
Many online news sources remove their articles after just a
few days of posting them, thus breaking our links -- we
apologize for the inconvenience.



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