Amid chronic labour shortages, one Japanese company has taken a creative approach to attract and retain new employees.
TrustRing, a tech company based in the western prefecture of Osaka, is offering its employees time off for hangovers and for dealing with upsetting news about their favourite celebrity, reports the South China Morning Post. One employee, interviewed by Kansai Television about applying for hangover leave, said “I can sleep for two to three hours more and come back to work feeling a bit more refreshed, which actually increases my efficiency.”
Large companies have responded to Japan’s shortage of workers by increasing the monthly salary offered to new graduates, paying up to 50 percent over the average of 237,300 yen (US$1,500) a month. For smaller businesses that can’t afford those high salaries, offering other benefits is the best way to compete.
TrustRing can only offer new employees a monthly salary of 222,000 yen plus overtime. But president Daigaku Shimada told the Post that “The company has good performance, and zero employees have left in the past three years,” partly thanks to the unusual leave benefits.
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Offering time off for hangovers or “celebrity loss,” such as when an employee’s favourite celebrity gets married or announces some other news that makes the staff member too sad to work, may seem silly, but there are serious reasons behind it. Unemployment has remained below 3 percent for four years, among the lowest in advanced nations, and in an aging nation with limited immigration, that is unlikely to change any time soon.
The labour crunch is particularly difficult for small and medium-sized enterprises (SMEs), which account for seven out of every 10 jobs in Japan. Bankruptcies are also on the rise, likely surpassing 10,000 in 2024, the highest figure in over a decade.
Takayasu Otomo, a researcher at Teikoku Databank, told the Japan Times that while only a small portion of business failures are due to worker shortages, the surge will ripple through those companies’ suppliers and customers, potentially causing a “chain of bankruptcies or mergers.”
Some officials characterise the bankruptcies triggered by worker shortages as an inevitable effect of “economic metabolism,” in which less-dynamic companies fall away, allowing workers and capital to move to more productive ventures. Nonetheless, the government has pledged to help SMEs raise prices so they can hike wages and attract workers locally or from a growing foreign workforce. The latter set its own records in 2024, even as the country remains largely resistant to mass immigration.
