In Japan, Starbucks announced last week that 800 of its temporary workers will be promoted to full-time positions on 1st April 2014; a move which pushes its current headcount of 1800 employees to 2600. It has also promised to hire only full time workers from now on! This is a remarkable development, countering the rest of the market’s trends. Starbucks has always bucked the trend and proved itself to be particularly pro-worker, as when it provided health insurance to part-time workers in the USA.
Better working conditions, competitive pay rates, benefits and opportunities for growth have always been considered to encourage more productivity and loyalty from employees. They also reduce attrition, a reality faced by most businesses in the food service industry. Companies offering great work environments may also reap other benefits, like some new customers who willingly switch their loyalties to retailers with enlightened employment policies.
Of course, we must recognize that Starbucks may not have been motivated by the subsidy offered by the Japanese government, which announced financial rewards to recruitment agencies and companies for every temporary worker transitioned to permanent employment during fiscal 2014. Though the offer comes too late for the transition plans made by Starbucks; it could sustain the momentum as many more companies in Japan take up this offer:
Young people in Japan, just like in the USA, are finding themselves unable to find regular employment even a year after graduation. It is interesting to see how the government in Japan has structured a creative subsidy system that enables these young people to find employment, initially in temporary roles but move on to permanent roles.
In the USA, recent Bureau of Labor Statistics releases demonstrate a direct correlation between the level of education and rate of unemployment. While the unemployment rate of those with a Bachelor’s degree has declined to 3.2% – significantly below the national average – the fact that many of them are underemployed and toil at jobs which do not require a four-year graduate study raises a lot of concern.
The Obama administration introduced the Pathways program which provides an opportunity for internship and employment with federal agencies. However, as a growing number of positions in the private sector require technical skills, and companies are reluctant to invest in training entry-level applicants, many recent graduates find themselves unprepared to compete for starting positions. Should we take a leaf out of Japan’s book to take up a similar initiative?
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