EMPLOYMENT

Hourly and Production Workers

The ability to attract production workers to the foundry industry in Japan appears to vary with the size of the company. In Japan, foundry work is known as "3 K" -- "kitsui" (hard work), "kitanai" (dirty), and "kurai" (dark). Thus it is not attractive to most workers or technical people. Large corporations have an apparent advantage as their prestige allows them to hire workers or engineers and then assign them to their foundry operations. Small independent foundries, however, must compete for workers with the corporations and are at a disadvantage. A number of the foundries the WTEC team visited are located in rural areas, and, in at least one case, this was deliberately done in order to provide employment for the local area.

Foundry workers in Japan are paid less than workers in other metalworking fields, as Fig. 9.1 indicates. It compares average wages (yen/month) for steel foundries, electrical machinery, nonferrous metals, metal fabrication, and basic steel industries since 1990. It is clear that foundries are not attractive places to work from a compensation standpoint.


Figure 9.1. Salary chart for workers in Japan's metalworking industries.

It should be noted that one iron foundry reported that the average wage for its workers, including benefits, was approximately ¥600,000 monthly. Foundry wages were reported to be escalating at the rate of about 3% annually until the recent recession. Since then wages have leveled off.

The unattractiveness of the foundry industry is reflected in the fact that the workforce in the foundries the WTEC team toured appears to be aging. One exception is the Daido Precision Parts investment foundry, which is a new, very modern plant built in a rural area. The average age of workers in that plant is 25 years.

Although foundry wages are relatively low by Japanese standards, they are high by international standards (especially based on the exchange rate of about ¥105 = $1 that pertained at the time of this WTEC panel's visit). This, coupled with difficulties in hiring, is responsible for the considerable amount of automation that is present in Japanese foundries. Many operations normally done manually in other countries are carried out by pick-and-place robots in Japanese foundries. Representatives of one Japanese company, which is planning to build a foundry in the United States to supply its largest customer (an automobile manufacturer), told the WTEC team that they do not intend to automate the American plant to the degree that their Japanese plant is automated because American wage rates and employment ages are substantially lower than Japanese.

The difficulty in attracting workers to the foundry industry is one of the reasons that the Japanese emphasize extensive worker training. Most companies require their employees to participate in two weeks of training each year. New hires often spend as much as one month (in one case, it was three months) being trained before they are put to work. Indeed, in many foundries, it appears that training and retention of skilled employees is more important than their recruitment.

One large foundry organization indicated that part of the problem is the Japanese system of training skilled workers, which is similar to that in the United States (i.e., workers are expected to train themselves). This company would prefer to have the German system, with master craftsmen training apprentices. However, they see this as a cultural problem that probably cannot be changed. The difficulty in finding skilled workers is considered to be a barrier to the expansion of the Japanese foundry industry, although the industry will maintain its global market share by building plants in foreign countries where its major Japanese customers locate plants.

Reports from Denmark and France show that European foundries experience similar problems in attracting young engineers and hourly workers. Except in the case where a new plant is established in an area that has high unemployment, recruitment of foundry workers is difficult. Some observers have speculated that foundry production will move from western Europe to eastern Europe for this reason, although no major trend has so far been noted.

Technical Employees (Engineers)

The Japanese foundry industry is similar to that of the United States in that 80% of the foundries are small (fewer than 100 employees). Small foundries find it particularly difficult to hire talented technical people from recent engineering graduates. The graduates would most prefer to work for the large steel companies, then the automotive companies, then aluminum companies, then other manufacturing companies: They will consider positions in the foundry industry, finally, only if there are no other jobs available. For all practical purposes, then, small foundries rarely hire graduates immediately from college and must staff their technical departments by hiring engineers away from large companies.

Although technical training is available at many technical schools and universities in Japan, foundry training is rare. There is only one school (Tohoku University in Sendai) that has a specifically named "foundry engineering department" although Tokyo University, Kyushu University, and Osaka University have specialists and strong programs in the area. Foundry professors in Japan agree, however, that it is very difficult to recruit students to major in the subject. Thus, in the Japanese foundry industry, as in the U.S. industry, many engineers have received their primary training in another field. The lack of engineers specifically trained in foundry engineering is considered to be a problem in Japan and a barrier to further growth of the industry.

In Europe, engineering is longer seen to be the desirable profession it once was. High unemployment of newly graduated engineers has discouraged other young people from studying engineering, and the opinion was expressed in European foundries WTEC visited that the best and brightest people avoid engineering and the foundry industry to study other subjects, especially finance and management. Although there are a number of world-famous foundry departments at European universities, government support for engineering faculties is falling in many countries.


Published: March 1997; WTEC Hyper-Librarian