October 19, 2004
Daiei's Surpluss Workers
This is from a Kyodo wirefeed on Daiei’s Surplus Workers:
This last bit is absurd. Isn’t part of the problem overcapacity? Wouldn’t shifting these workers to rival chains amount to a shell game where the excess is simply transferred?
Besides, what rival retailer would want to take on extra workers right now? Last week the IHT reported that rival Mitsukoshi planned on closing nine of its outlets and eliminating 800 jobs in an effort to speed up its debt payments. The article went on to note that:
And on Tuesday last, the Wall Street Journal reported that French retail chain Carrefour planned on selling all eight of its stores in Japan. (To be fair, part of the reason was due to increased competition in Europe, but they are still leaving.)
So much for rival employers picking up the slack.
And if Daiei’s inability to cut costs was one of the reasons (of the many, admittedly) it eventually had to seek out IRCJ help, it’s sadly ironic that it now may have to rid itself of nearly half of its employees, when cutting a smaller percentage of those jobs two years ago might have made a difference. It may not have been enough to save the ship, but it would have at least indicated seriousness on the part of Daiei’s management.
So, either Daiei was aware of this fact, and felt like the gamble for private-sector funds was worth the risk, one might be forgiven for concluding that keeping so many surplus workers is just another example of Daiei’s failure to cut costs and payback its debt.
Struggling retail giant Daiei Inc. may have as many as 27,000 surplus workers if
it specializes in food supermarket operation under its rehabilitation, sources
close to the case said Monday.
The figure is about half the 58,000
full-time and part-time workers employed by Daiei as of the end of February. The
government has requested that Daiei fully take into consideration possible
impacts on Japan's employment situation and regional economies in compiling its
rehabilitation plan.
The banks concluded in the estimate that those
personnel could be employed by rival retailers and new tenants who will enter
buildings now housing Daiei outlets. But it remains unclear whether their
reemployment is ensured.
This last bit is absurd. Isn’t part of the problem overcapacity? Wouldn’t shifting these workers to rival chains amount to a shell game where the excess is simply transferred?
Besides, what rival retailer would want to take on extra workers right now? Last week the IHT reported that rival Mitsukoshi planned on closing nine of its outlets and eliminating 800 jobs in an effort to speed up its debt payments. The article went on to note that:
Six years of falling prices have squeezed Japanese retailers, forcing some of
them, including Daiei, the country's third-biggest merchant, to seek fresh funds
from banks and investors to avoid bankruptcy.
And on Tuesday last, the Wall Street Journal reported that French retail chain Carrefour planned on selling all eight of its stores in Japan. (To be fair, part of the reason was due to increased competition in Europe, but they are still leaving.)
So much for rival employers picking up the slack.
And if Daiei’s inability to cut costs was one of the reasons (of the many, admittedly) it eventually had to seek out IRCJ help, it’s sadly ironic that it now may have to rid itself of nearly half of its employees, when cutting a smaller percentage of those jobs two years ago might have made a difference. It may not have been enough to save the ship, but it would have at least indicated seriousness on the part of Daiei’s management.
So, either Daiei was aware of this fact, and felt like the gamble for private-sector funds was worth the risk, one might be forgiven for concluding that keeping so many surplus workers is just another example of Daiei’s failure to cut costs and payback its debt.
# posted by Saru : 2:59 PM
