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"Yet, most companies are unwilling to offer the pay required to lure more of Japan’s smart students into the field. That’s largely because, in most companies, seniority counts more than occupation in determining pay. Attempts to alter this practice have run into resistance from unions as well as non-union workers who, based on experience, see such changes as attempts to lower the pay of workers without such special skills."

So basically the two major issues blocking this are (i) the 年功序列 system; and (ii) a culture of wanting to get promoted into higher-paying management positions which are less technical (i.e. the "real work" is done by harder working, lower paid juniors, just like ものづくり職人 are respected for their art but ultimately not well paid)

I cannot see how this will change given the mass consent required to change, and resistance to giving special treatment to certain groups of people

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Apr 10, 2023Liked by Richard Katz

This sequence has been riveting. Looking forward to part 3.

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I suppose there are two ways of tackling the disincentive to go into a STEM subject at university - either reduce the costs of a STEM degree, or increase the rewards, or both. Reducing the costs seems as if it might be easier to implement on an across-the-board level (though expensive for the government, I suppose, and therefore in that sense not easy). I'm not sure how higher education subsidies work; maybe the government needs to reduce subsidies to non-STEM subjects in order to save enough money to increase subsidies for STEM?

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Fascinating stuff, Rick. It's easy to see that higher university fees for science subjects would be a deterrent (and the answer, in theory, would also be easy - the government could subsidise these subjects more, so that the fees could be lower). But the issue about seniority rather than job pay being an issue seems more uncertain. After all, in theory, the seniority issue applies to all types of jobs, so it shouldn't make it less attractive to be an ICT worker (or other STEM career) rather than, say, a generalist manager, marketing person, etc. It doesn't seem to explain why ICT people earn below median income rather than median income (and I suppose there must be certain careers that offer above median income, by definition, and thus are more attractive - what are they, and how come they can offer above-median jobs despite seniority-related pay?).

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