- Economic Situation
- Consumption Tax Increase
- Electricity Policy
- Issues with 24-Hour Operation of Convenience Stores
- Premium Friday
- SME Policy
- Recruitment and Selection
Concerns have been voiced that current circumstances overseas may have a dampening effect on the economy. Certainly not all indicators are positive, and demand is falling for products such as semiconductor materials, smartphones, and automotive goods, but I do not consider that this will necessarily have a major impact on business activity and the Japanese economy as a whole. I find that companies which make future-oriented investment, especially focusing on fields such as IoT and AI are increasing rather than decreasing.
Consumption Tax Increase
The Japanese business community will take necessary steps to prepare for the increase in the rate of consumption tax. At present, for example, retailers have not succeeded in smoothly adjusting complex loyalty points schemes. Six months remain before the increase is due to take effect, so every effort will be made to prepare for it. Keidanren urges the Japanese government to raise the consumption tax rate to 10% as planned.
Electricity liberalization has not necessarily led to lower electricity charges as originally intended. While system reforms have achieved liberalization of electricity retailing, they have prompted electric power companies to curb investment rather than reduce charges. Various policies need to be reconsidered in a liberalized electric power market. The power generation situation clearly shows that thermal energy is rising in importance while nuclear generation remains on hold. Unstable energy supply from renewable sources is increasing, and this does not create a healthy market structure.
Issues with 24-Hour Operation of Convenience Stores
I understand that the Minister of Economy, Trade and Industry, Hiroshige Seko, has asked major convenience store chains to develop a voluntary action plan, because in some areas these stores are a key part of infrastructure for people's lives. Providing full services over 24 hours of operation presents challenges in terms of costs and labor shortages. The industry will bear in mind its response to customer needs as it formulates a plan.
The idea of leaving work as early as possible at the end of the week is taking hold. Innovation is becoming increasingly crucial as digital transformation progresses, and one aspect of this evolution is a pressing need for a change in the quality of working styles. Another aspect is the realization that hard work alone does not lead to innovation, including awareness of the importance of ensuring free time. In this context, excitement about Premium Friday is no bad thing. It is vital to keep up this initiative.
The Japanese economy is in the midst of sweeping structural change. Digital transformation will drive a shift from an industrial structure characterized by large corporations and SMEs, and contractor-subcontractor relationships, to supply chains typified by horizontal information-sharing among companies. Against this backdrop, the key question in considering Japan's industrial structure is how distinctive and competitive SMEs will exercise their strengths. The number of SMEs joining Keidanren is on the rise, and I hope they will make effective use of our platform to voice their opinions. We are focusing on dialogue with SMEs.
Recruitment and Selection
This is not simply a matter of determining a schedule for hiring all new graduates at the same time. It is a question of selecting the most important resources for business management, in other words deciding what sort of personnel are required. In an era of innovation, how will we recruit the human resources we need, and how will we enable them to shape their careers? At a time when the methodology for achieving these ends is changing dramatically, I am mindful of the need for constructive discussion about the nature of university education and recruitment. We have already starting deliberating these issues with universities, but ideas differ from one university to the next, and even among faculties within institutions. Building a general consensus will be no easy task.
Expectations for young employees are changing in many enterprises. Given these changes, discussion of a vision for recruitment is ongoing. This issue goes well beyond concerns about bringing forward the schedule for selection activities, or higher levels of informal job offers in March and April.
Now that Brexit has come to this point and still no conclusion has been reached, the leadership of the British Prime Minister is inevitably being called into question, and risks associated with political chaos are emerging. Faith in the pound is also a concern. In these circumstances, rather than simply demanding that the government avoid a no-deal outcome, companies must seriously think about how to cope with the realities of the situation. Enterprises that do a lot of business with continental Europe are likely to require different responses from those that do not.