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  • The ludicrousness of Japan’s Salary Bonus System: How it contributes to Japan’s deflationary spiral

    Posted by Dr. ARUDOU, Debito on December 17th, 2009

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    Hi Blog.  Big news across Japan these past couple of days has been how the Winter Bonus has been slashed between 10 to 15 percent for bureaucrats:

    Japan Times Friday, Dec. 11, 2009
    Bureaucrats’ winter bonuses shrink
    Kyodo News (excerpt)
    Central and local government employees got smaller winter bonuses than usual Thursday as the protracted recession took its toll on compensation, according to estimates from the Internal Affairs and Communications Ministry.

    The bonus for a 35 1/2-year-old civil servant with a nonmanagerial job came to an average of ¥647,200, down 6.6 percent, while that for a 36.6-year-old local government employee came to ¥607,000, down 7.3 percent, the ministry said.

    Rest of the article at http://search.japantimes.co.jp/cgi-bin/nb20091211a5.html

    (BRIEF ASIDE FOR THOSE UNFAMILIAR WITH JAPAN’S “BONUS” SYSTEM:  Those of us on regular full-time salaries get paid monthly, then get a “bonus” of several months pay every six months (usually between two to six months’ pay total, divided by two times a year, which in effect increases your total annual salary mathematically by about a third).  This has long been standard practice in Japan, and every June and December the postwar Japanese economy suddenly becomes awash in cash, as families suddenly get a glurt of around 100 man en in their accounts.)

    Some people might say, well, tough beans — these bureaucrats were being overpaid anyway, so it’s about time.  The problem is that this practice is a bellwether:  other industries see this as an excuse to cut their own salaries.  My university (which is private-sector, but they directly cited the Bonus cuts to the national bureaucrats (kokka koumuin) as justification) cut all of our Bonuses this year and will continue to do so in perpetuity.  As in:  they cut our bonus multiple from 4.5 months’ salary total per year to 4.15 months’, and will not change that until the national bureaucrats revise their multiple upward.

    So that means my Winter Bonus this December dropped by 15% compared to the same Winter Bonus December of last year, or about a drop of 12 man before taxes, and man am I pissed off about it.  (I might add that this is on top of the general trend:  my total annual salary has dropped more than 200 man between 2003 and 2008.)  This means that paying off my bank loan for the house I built back in 1997 (I owe three months’ mortgage payment every bonus), and a bit of insurance on top of that, completely devoured my Bonus for the first time ever yesterday.  Any more cuts, and I’m going to lose money every Bonus period.

    That’s if I get a Bonus at all.  That’s the screwy thing about this Bonus System.  It’s fine in a high-speed growth economy, where you have businesses withholding about three to six months’ pay so they can earn interest on it, then pay your employees in a glurt and keep the interest.  But banks in Japan don’t pay interest anymore, so that’s no longer an incentive.

    And in a mature (or even flat or negative GDP for the past two decades) economy, the Bonus System just doesn’t make sense anymore.  When you can at whim withhold a third of somebody’s salary just because the company feels it didn’t perform well enough this quarter, that should be cause for strikes and reforms.  But Japan’s unions are pretty weak and underwhelming in negotiations (compared to, say, Korea’s), and I have heard no voices yet for abolishing the Bonus System in favor of a flat (and higher) monthly salary.

    I heard yesterday from a friend that he heard on the TV wide shows that only 14% of all people surveyed got a rise in Winter Bonus this December.  Everyone else either had no change, a drop, or NO BONUS AT ALL.  (I searched for a source for this, but came up short.  Debito.org Readers, please have a look around too.)  If this is true, and almost everyone is getting screwed by this system and losing money in real terms, it’s not just a labor issue anymore:  We’re talking about a deflationary spiral, as domestic consumption decreases and domestic demand follows suit, and more companies find themselves yet again cutting Bonuses because they say they have to, but really because they can.

    Considering that banks in Japan do not offer refinancing deals (mine, Hoku’you, formerly Takugin, doesn’t; I asked), this deflationary spiral just means they’re taking more money from me even if my monthly payments stayed the same.  (They’re not, by the way — they’ve gone up about 1 man per month over the past two years!  Double whammy.)  And banks are wondering why more people are defaulting on their loans these days?  They should stop being greedy and start lowering their premiums too to match the fact that people in general are being paid less.  But that’s not going to happen for the foreseeable future, because there’s no precedent for it.  Meanwhile, Japan just keeps sinking deeper, as “the system that soured” (to quote Richard Katz) gets more and more sour.

    Lose the Bonus System.  It is increasingly becoming a way to deprive workers of a third of their annual salary at corporate whim.  And it only feeds the forces that are hurting Japan’s consumers.  Arudou Debito in Sapporo

    ====================

    UPDATE DEC 17:  Courtesy of Ken.

    Winter Bonuses To Fall To 20-Year Low: Nikkei Survey
    http://www.nni.nikkei.co.jp/e/fr/tnks/Nni20091210D10JFF05.htm

    TOKYO (Nikkei)–Overall winter bonuses to be paid this year will tumble to a level last seen 20 years ago, according to final estimates that Nikkei Inc. released Thursday.

    A drop in winter bonuses may mean a gloomy year-end shopping season.

    The weighted average bonus is seen falling 14.81% from the previous year to 701,571 yen before taxes, down for the second straight year. This is the sharpest drop since the survey was first conducted in 1978.

    The Nikkei tabulated the bonus payment plans of 643 companies. The percentage of firms that will cut bonuses rose from 51% in last year’s survey to 83%. Meanwhile, those planning to raise bonuses fell from 44% to 12%.

    The bonus cutback signals that corporations are still trying to curb personnel costs due to uncertainties over future economic trends, despite some earnings improvement from growth in emerging markets.

    Bonuses are expected to fall 17.71% at manufacturers. The automobile and electronics sectors, which had increased bonuses in 2008, are poised to cut them by around 20% this year due to slumping exports caused by the global economic downturn and strong yen. Food producers plan to raise bonuses by 0.26%, making it the only group among the 18 manufacturing sectors to boost payments.

    Nonmanufacturers plan to reduce bonuses by 5.17%, except for firms in the land transport sector, which plan to bump up payouts by 0.08%.

    (The Nikkei Dec. 11 morning edition)

    51 Responses to “The ludicrousness of Japan’s Salary Bonus System: How it contributes to Japan’s deflationary spiral”

    1. jjobseeker Says:

      I’ve always been a little suspicious of this “bonus” system ever since I got here. My wife, my brother-in-law’s bonuses have been drastically cut, and it never made sense to me why their annual salary and/or wages never go up instead. I mean really, people would rather have their money on a “real time” basis than having to wait for their Summer and Winter bonuses for cash they should have had all along… Seeing as these bonuses are also taxed (that’s the twist of the knife), I have always theorized that the Bonus System was a way for businesses to “cheat” on their taxes. Since this money isn’t categorically a wage or a salary–more like a gift–they probably write it off on their taxes thus allowing them to lift their bottom line. I have no clear evidence or hard facts to support this so if someone out there with accounting knowledge could shed light on this alleged “bonus” system, I would appreciate it.

    2. peter Says:

      I thought people in Japan only use their summer and winter bonuses to buy the obligatory summer and winter gift sets that department stores seem to pimp out during this time.

      I always found it hard to believe the bonus system here, as in everyone expects to get a bonus. Is this tied to job productivity, performance or not at all? My wife’s father runs his own company and he was considering cutting the summer bonuses because business was slow and the company’s income was down. His workers almost revolted because their bonuses were being cut!!! Which leads me to believe that they are in fact an expected part of pay

      As for fudging the numbers with taxes.. if the payment of bonuses did indeed allow companies to write it off in taxes then it would be in their best interest to keep paying them or go one better and reduce wages and increase bonuses. I suspect however that there is no tax benefit since companies probably have to pay a payroll tax on employees’ wages which could be a fixed amount or proportionally linked to the workers pay, i.e the worker earns more money, the company pays a higher payroll tax. So if anything, companies will want to reduce income to its employees so it will pay less taxes and probably have more cash on hand to pay off current liabilities which aren’t wages, like short term debt, interest payments, etc

      However, I do not have a clear understanding of accounting in Japan so perhaps companies here do things differently than in Canada or the states.

    3. Matt at anarchyjapan Says:

      Let’s see, how can I keep this really, really short. The past trend in economics over the last 70 years or so has emphasized the importance of the central bank in keeping price stability. The reality is that this allows the governments to spend rather recklessly (some more than others), and for the difference to be made up by weakening the currency (printing cash to buy government debt). As this system is good for politicians (allowing them to buy favors) it has been the favored system for quite some time now (although we’re beginning to see the consequences of it). In a healthy economy we should expect prices to go down. Just think of the computer market, we keep getting better computers at lower prices. As long as technology is improving, why shouldn’t this be happening in other places?

      You state the bonus system is not good, and a flat salary would be better. I will have to think about this.

      You state, “We’re talking about a deflationary spiral, as domestic consumption decreases and domestic demand follows suit, and more companies find themselves yet again cutting Bonuses because they say they have to, but really because they can.”

      I don’t want to comment on which companies should or shouldn’t be making cuts. There might be a lot of merit to what you are saying. I really don’t know. However, in general, if prices come down as a result of this, people need less money to buy things. If prices are coming down, it might makes sense to save a bit more, and this money (unless tucked under a mattress) would lead to more investment, which would help improve production/technology, thus we’d get more products and even cheaper prices. The idea that Japan needs to stimulate consumption is in my mind a complete myth. It just excuses government excess, and so it’s a popular myth. (In fact, it’s a well endowed subsidized myth purported through out most of academia in America — this has been well documented by the way.)

      So while it might be companies are using the government example in some way as an excuse to pay employees less, I certainly don’t think it’s the case they must pay employees more *because* to do so would be good for Japan.

      I’ve condensed what I’m saying a lot, but I can’t urge any one whose interested in this enough, the check out the following powerpoint slides, which can be downloaded here:
      http://www.auburn.edu/~garriro/macro.htm

      Professor Garrison has done an incredible job of explicating the difference between consumption based economics and capital based economics.

    4. Mark Hunter Says:

      The problem with the bonus system is one of terminology. A bonus in Japan is deferred salary, that’s all. Companies keep unpaid salary in their accounts, making interest from it, then pay it out later. The first crime is that total yearly salary can be adjusted on the whim of the employer with little regard to worker rights. A second crime is that companies are profiting from keeping all that money in the bank, albeit at low interest rates. I am totally opposed to the bonus system.

    5. snowman Says:

      Agree with you totally Debito. A true bonus is extra cash for a job well done. So why does japan call these withheld salary payments “bonuses”?? Just another way that companies can screw their workers. Yes time to abolish this “system”. But won’t happen as the “bonus” system well suits companies.

    6. Mumei Says:

      The term “bonus” as applied in Japan is rather misleading. Monthly salaries are generally kept rather low and only made up by “bonuses” which one is entitled to as part of their actual salary.

      My Japanese technology company has been increasingly hurting since the fall 2008 when the economy suddenly plummeted. This resulted in a reduced 2008 winter bonus, no 2009 summer bonus and apparently no winter bonus, in addition to pay cuts. It is rather depressing to consider my annual income this year. However, even with these cuts there is serious concern if the company can actually survive. I had been with them for a number of years, but worrying about my own survival decided to tenshoku which just happened recently. My new company has a fixed annual salary (年俸制) so there is no concern over varying bonuses.

      In recent news, the government released details on the national poverty rate:
      日本の貧困率は15.7% 厚労省が初公表
      http://www.asahi.com/national/update/1020/TKY200910200185.html
      2009年10月20日14時4分

       長妻昭厚生労働相は20日、低所得者の占める割合を示す「貧困率」について、07年は15.7%だったと明らかにした。政府として貧困率を公表するのは初めて。長妻氏は会見で「今後、子ども手当など、数値を改善する政策を打ち出していきたい」と述べ、数値を踏まえて貧困解消に取り組む考えを示した。

       公表されたのは国民生活基礎調査をもとに算出した「相対的貧困率」。所得を世帯人数に振り分けて高い順に並べたときに真ん中の所得(228万円)を基準に、その半分に満たない人が占める割合を示す。

       今回は、98年以降の3年ごとの数値も公表された。98年時点では14.6%、01年は15.3%、04年は14.9%だった。

       経済協力開発機構(OECD)の08年報告書では、04年の日本の貧困率は14.9%で、加盟30カ国のうちメキシコ、トルコ、米国に次いで4番目に高かった。30カ国の平均値は10.6%。日本は働いている1人親家庭の子ども(18歳未満)が58%と、圧倒的に高かった。厚労省は今回、1人親家庭を含む18歳未満の子どもの貧困率は14.2%(07年)と公表した。

       同省は今後、1人親家庭や、子ども手当を受給した場合の貧困率も調べる。

    7. Al Says:

      Regarding bonuses in the Education sector it is only natural that will decrease year after year as the industry is in decline due to falling attendance.

      In general I think the idea of the bonus is to protect the business. If profits are not as high as hoped or the company needs quick cash they can just decrease the bonus that year. It’s much easier than giving pay cuts and less personal so less likely to cause less animosity.

      Imagine a salaryman going back to his wife and saying he got a paycut, she might think that he is not good at his job. But go back and tell her that the bonus won’t be so high this year and at worst she will think he selected a crappy company.

    8. Kimberly Says:

      This doesn’t have a lot to do with the bonus system, but as far as your mortgage have you looked into changing banks (借り換え)? I’m not sure if you can actually lengthen your mortgage (for example, take 25 years remaining of a 35 year loan and redivide it over a new 35 years starting next year), but you can at least change from fixed interest to, uh 変動 not sure what that is in English, or the other way around, redistribute the ボーナス払い into the regular monthly payments or increase the bonus payments to lower the monthly ones. We’re with a local bank right now but are looking into changing to Sony Bank next year when our special introductory interest wears off. At least according to the guy from Sony, Sony will completely pay off the loan at the regional bank, and it would essentially be a new mortgage, RE borrowing the money from them. So you may be able to “re-finance” if you switch banks?

      I think they keep the system the way it is because it gives them a loophole, a way to lower salaries. At my husband’s company, they have a policy NOT to lower the salary of seishain. However, the bonus is not technically “salary” so they can raise or lower it at will, with no obligation to pay the same amount next year. If they don’t, though, we are in the same boat as you… most people are, I imagine, so many “bonus-barai” payments that they’ve come to count on that income.

      – 変動 is “variable” as in “variable interest rate”. I am locked into a 30-year mortgage where the interest rate is adjusted once every five years or so (and for some reason they keep ratcheting it upward, despite interest rates being lower than in 1997, when we first took out the mortgage). Thanks for the advice.

    9. Jerry Says:

      I can’t speak to how the taxes on businesses go (or the advantages to them in paying bonuses) but I can say that my bonus in Japan is taxed at a far lower rate than my bonus in the USA (which is taxed at almost 50%) or my regular salary. But having read a little bit on it my bonus structure might be calculated a little differently than “normal” (I have an annual salary then a bonus target on top of that tied to a percentage of my annual income). Looking into it does the “normal” bonus system work by say your salary is set at 14,000 per year and you get a 1 month bonus paid 2x per year. So instead of paying you 1,167 per month and giving you 1,167 extra 2x per year as a bonus (which is essentially how my bonus structure works) they actually pay you 1,000 per month and $1000 2x per year as a bonus?

      If the second is the case then yes, I could see getting angry about it…

    10. Joe Says:

      I’m surprised to find that the bonus system is still so prevalent in Japan, as I thought that it has been in the process of being phased out by the companies themselves. The last company that I worked for that had a Summer/Winter bonus system abolished it in 2002 (largely for the reasons that Debito argued for above; the company incentives for doing it no longer exist), and the other two I’ve worked for since then have had no such system in place since I joined (though they both had “performance” bonuses once a year in line with personal/company performance; this was a “bonus” in the true sense of the word)

      I suppose that some glass-half-full type people still think of their annual bonuses as something extra from the company, so perhaps the system instills loyalty in the more naive types, or maybe continued nostalgia for the days of lifetime employment?

    11. Taylor Says:

      While the bonus system may or may not have a sound reason for existing, there is one trend that is undeniable;

      Given that bonuses are common in Japan, most employees will wait to quit AFTER receiving their bonus. In this sense, rather than having to replace employees throughout the year, employers can count on very few employees quitting in the 2 to 3 months preceding their bonus.

      In the social context, it allows companies to arbitrarily screw their employees, and forces employees to be frugal with their monthly paychecks (good for the postal savings system).

      I have heard (but have no proof) that bonuses even within the same company are not standard. In my experience I found few Japanese people willing to discuss the amounts of their bonus…could it be that some employees receive more than others?

    12. Banker Cat Says:

      glurt = ‘glut’ perhaps?
      http://www.urbandictionary.com/define.php?term=glurt

      As for ‘refinancing deal’ are you talking about refinancing a home loan, or are you talking about a workout, i.e. a renegotiation of your current loan terms? A bank is normally not going to renegotiate terms of a loan because you are being paid less (in real terms) than you were at the time of the loan’s origination.

      – Glurt is a large (in)flow of something (onomatopoeic). Glut is a surplus.

      The bank has told me it will readjust terms of mortgage if my salary drops so far I’m about to default. Concretely, they say it has to drop by about a third since the time we took it out. It’s dropped by about 22% so far. What they’re not taking into account is that in real terms the yen is deflating, meaning that in real terms the amount I’m paying in is rising. That should be taken into account. (No doubt the bank would find reasons to raise payments if the opposite happened. i.e, Japan went into an inflationary spiral. Then it’s the business’s hide on the line and I’m sure they’d lobby the GOJ for permission and be granted it.) This short-sightedness in terms of economic reality is only going to encourage defaults, and the bank will lose money anyway.

    13. debito Says:

      Winter Bonuses To Fall To 20-Year Low: Nikkei Survey
      http://www.nni.nikkei.co.jp/e/fr/tnks/Nni20091210D10JFF05.htm

      TOKYO (Nikkei)–Overall winter bonuses to be paid this year will tumble to a level last seen 20 years ago, according to final estimates that Nikkei Inc. released Thursday.

      A drop in winter bonuses may mean a gloomy year-end shopping season.

      The weighted average bonus is seen falling 14.81% from the previous year to 701,571 yen before taxes, down for the second straight year. This is the sharpest drop since the survey was first conducted in 1978.

      The Nikkei tabulated the bonus payment plans of 643 companies. The percentage of firms that will cut bonuses rose from 51% in last year’s survey to 83%. Meanwhile, those planning to raise bonuses fell from 44% to 12%.

      The bonus cutback signals that corporations are still trying to curb personnel costs due to uncertainties over future economic trends, despite some earnings improvement from growth in emerging markets.

      Bonuses are expected to fall 17.71% at manufacturers. The automobile and electronics sectors, which had increased bonuses in 2008, are poised to cut them by around 20% this year due to slumping exports caused by the global economic downturn and strong yen. Food producers plan to raise bonuses by 0.26%, making it the only group among the 18 manufacturing sectors to boost payments.

      Nonmanufacturers plan to reduce bonuses by 5.17%, except for firms in the land transport sector, which plan to bump up payouts by 0.08%.

      (The Nikkei Dec. 11 morning edition)

    14. AIB Says:

      Debito wrote

      “What they’re not taking into account is that in real terms the yen is deflating, meaning that in real terms the amount I’m paying in is rising.”

      I’m no economist, but I’m not sure that I get you argument here – the yen hasn’t deflated at all – your 100 yen is still worth 100 yen, and deflation actually means that 100 yen now buys more. Your salary is decreasing, so in real percentage terms (relative to your salary), you are paying more in.

      I do agree with you that the Japanese style of bonus system (dividing yearly salary by 15 to calculate monthly salaries etc) isn’t great.

      – I’m no economist either, but just in terms of logic:

      If 100 yen now buys more, it’s not worth the same 100 yen. Inflation works the same way only in reverse, and if it costs 102 yen to buy what would buy what 100 yen would before, stuff therefore costs more if wages don’t rise. Likewise if it costs 98 yen to buy what would buy what 100 yen would before, prices are going down in real terms.

      Problem is, prices (or loan payments) aren’t going down much (or at all) to reflect that. Prices are regularly ratcheted up in an inflationary economy, but rarely ratcheted down (or never, in the case of bank loans) in a deflationary economy to reflect current economic conditions (i.e. the phenomenon of “sticky prices”). Hence we’re seeing a real price rise even if the nominal price stays the same.

      We’re especially seeing this real price rise exacerbated further as wages even go down. And that’s going to feed into itself as wage drops mean consumption drops created further wage drops… capiche?

    15. adamw Says:

      i agree with you on the bonus system-i think its ridiculous.
      it has even less point since they changed the laws to tax it.
      dont follow why the bank should renegotiate with you though..

      good luck anyway-times are hard all round…
      (like you i cant see them getting better either)

    16. iago Says:

      According to this:

      http://www.okamoto-co.co.jp/news0400_e.pdf

      The deduction rates for social insurances used to be much lower on bonuses than on standard monthly salary, hence the bonus payment system was advantageous to both employee and employer.

      I believe there is still a cap on the amount levied against for bonus payments that can make the overall contribution lower if “salary” is paid as a “bonus” rather than as a standard monthly payment (1.5 mil yen cap on bonus vs. 620,000 yen for standard monthly payment):

      http://www.jetro.go.jp/en/invest/setting_up/laws/section4/page9.html

      With regard to income tax, both appear to be treated the same.

    17. Banker Cat Says:

      When you took out the loan, were you (made) aware of inflation-related risk?

      – Yes. Obviously inflation is irrelevant here.

    18. chuckers Says:

      >Problem is, prices (or loan payments) aren’t going down much (or at all) to reflect that. Prices are regularly ratcheted up in an inflationary economy, but rarely ratcheted down (or never, in the case of bank loans) in a deflationary economy

      That is because bank loans are not tied to prices, they are tied to interest rates. The price you would have to pay for your home now is probably less than what you paid for it back in 1997. The amount you would need to borrow from your bank would be less. However, bank lending rates in 1997 were a lot lower than they are now. I don’t know the details of you loan but rates have been creeping up for quite a while at this bank:

      http://www.hokuyobank.co.jp/rates/img/transition.gif

      (That is your bank, right?)

      Those rates are set by the bank and have little to do with the governmental rates. Banks are seeing things go into a downward spiral so they ratchet up the rates. Why? Get more money up front from those that might default. If people are going to default, milk as much as you can get out of them with higher interests rates. All the same while, they are cutting the rates on their savings accounts and CDs.

      Bonus loan repayments are not really recommended. See this article:

      http://www.housingloan-hikaku.com/plan/hensai_bonus.html

      Basically, it says that while bonus loan repayments will lower your monthly payment, you run a bigger risk of defaulting in a bad economy when the bonus numbers don’t come through. You are FAR better off taking the straight monthly payment and if/when you do get your salary bonus, take that extra money and put it towards an early repayment. That will shorten the term of your loan and save you money in the long run.

      You could try talking to your bank about home improvement loan that is tacked onto the top of your current home loan and refinance that way. Upgrade your water heater to something more energy efficient or making it barrier free etc., things which doesn’t necessarily mean costing huge amounts. You renegotiate it into your current loan and get better loan repayments that way.

      This is only really worthwhile if there is something like better than JPY 1,000 MAN left on the loan and the difference in loan rates is about 1% or greater. Talk to an account or FP or even your bank about whether it would work out cheaper for you in the end. Don’t forget you will need to pay some more bank fees to refinance.

      – “A lot lower” in 1997? They’ve changed all of one percent. Not sure that’s “a lot”, but then again I’m used to interest rates one found in the US in the seventies. And I’m fixed to change at only half-percents of the difference between now and then every five years.

      Thanks for the other advice. Wish I had known it back then.

    19. Matt at anarchyjapan Says:

      There’s a certain irony in stating that the problem is “sticky prices” (in the market for goods), and then prescribing “sticky prices” (in the market for labor.) Also, if I’m not mistaken the problem of sticky prices is more often than not in reference to wages as a result of minimum wage laws and union agreements.

      But what I’m wondering is how do prices maintain themselves if no one can afford the goods? Are you suggesting a company would prefer not to sell the goods and so will just hold on to them if no one wants to buy them? Obviously that’s not possible because the company would go bust. So if companies are managing to hold prices steady *without* going bust despite decreasing consumption, then we need to examine how that is possible. (You could suggest they make up the difference in unsold goods by lowering wages, but they *still* have the unsold goods. So that doesn’t really work.)

      Perhaps you are thinking the company will just cut production to keep the price high, but then what will they do with the excess capacity? They’ll still have to pay rent on their factories and so on, even if they lay off workers. So it would still be better to cut wages *and* prices. I guess we could imagine a case where the bank has to foreclose on the company, and the bank ends up with the factory. Then the bank tries to sell it, but no one will buy it. So the bank faces difficulties. The bank itself could go under. So then the central bank or the government will step in to help the bank. Ultimately money will be created and this will be inflationary. And I guess you seem to be suggesting that if the government inflates now via wages (for which the government must pay via bonds or higher taxes) this will save those factory jobs as well?

      Whatever it is you are suggesting, I think it probably raises a lot of fundamental problems that seem to me to go beyond the scope of what you want discussed here. I would guess.

      For my part I think the problem of sticky wages (to the extent it might really exist) is a problem that arose primarily from government intervention, and would look to remove this intervention slowly and piecemeal over time. I’m sorry on a personal level that your wages are decreasing, but I think the government needs to curve it’s expenditures in some way.

    20. David B Says:

      When I interviewed for my current company we discussed a monthly salary figure. As many Japanese companies have “bonuses” I asked if this company had bonuses. The boss said if we want to take my salary x 12 /16 he would pay that monthly and give me 2 month bonuses at summer and winter. I chose not to have “bonuses”.

      My personal thoughts on this situation are that there always has to be some flexibility for companies for them to be able to adjust to differences in the economy. In the old days there was lifetime employment and almost all employees were permanent so this was how the flexibility was provided. In the last 15 or 20 years there has been big increases in part time and temp workers along with an erosion of the lifetime employment concept. As such I think revision of this “bonus” system needs to be reviewed…

    21. Kaoru Says:

      When I started at my current company 7 1/2 years ago I was given the same option – a six monthly bonus, or to have it pro-ratered into my monthly income. I chose the latter option as it was what I’d been used to until that point. When I become a seishain though, I had to go to the deferred salary system which meant my monthly income would drop by a third, but when the bonus payments come through, it would add up to about the same (and I’d also get paid overtime). This year my summer and winter bonus has been approximately half what it was last year, meaning I’m earning far less now than I was 15 years ago, which makes me think I’d probably have been better off remaining as a contract employee. On the other hand though, I’d probably be unemployed if I had, as they’ve decimated staff two years running now.

      Bonus payments are directly related to pay scale with a very minor adjustment according to performance. Curiously, they also augment the bonus to offset tax deductions now.

      Awful system.

    22. GiantPanda Says:

      One of the reasons for the guaranteed bonus structure (i.e. annual salary divided into 14 or 16 “months”) is that the company can use this structure to lower overtime costs. The “bonus” portion is not included in the calculation of the employee’s hourly wage rate.

      In theory, by law the “guaranteed bonus” can only be adjusted down if the employees agree to it (since it is considered to form part of salary), while a discretionary “performance” based bonus can be adjusted without consent. However Japanese bosses are adept at using the group dynamic to manufacture “consent” to the lowering of guaranteed bonuses.

    23. Jeremy Says:

      it’s a real carrot and stick thing – do the overtime or you won’t get the bonus. Japanese workers tend to beaver away all year and work late and not spend their salaries, then picking up big bonuses at the end of the year. They do quite well out of it, even though they are getting the same amount of money in terms of a yearly salary but divided up differntly.

      a complete no-brainer

    24. Mike Says:

      I have never seen a bonus in all my time working here in the gaikokujin ghetto for numerous English dispatch companies. For all the talk of the unfairness of bonus cuts, I think it is good to keep in mind that not just English teachers, but almost all part time workers never see anything of the sort in their paychecks.

      Seems like the system is being divided between 正社員 who manage to get on the career track following university graduation, and everyone else who has missed the boat.

      Sorry for the negativity, that’s just the way I see it from my vantage point. I would be happy to hear any good stories out there to prove me wrong…

    25. Colin Says:

      How do Japanese employees feel about this situation? Has anyone had a chance to discuss this with them? Then again, I`m not overly confident that anyone (especially Japanese workers) will say anything anyway. Heads will be directed downward and they`ll get on with their jobs. Democracy at its best!

      – You’re talking to one of them now. Anyway, yes, the news has been focussing upon their plight, and a lot of them are not happy about it. But what are we going to do, quit? Go on strike? We’re not quite at starvation level yet.

    26. Gilesdesign Says:

      In an interview for a job in Japan a few years ago at a major Japanese manufacturer, they explained the salary and also explained some other perks like I would get a bonus on two months of the year some health cover etc. The salary was not great but with the perks I went ahead and agreed (this involved moving to Japan from UK!)
      However when I got to Japan I found out the bonus they mentioned was already included in the salary figure. So effectively they were offering to withhold a substantial part of my salary for most of the year and then only release it two me in two months of the year.
      The contract was adequately ambiguous that I could not fight it.
      Truly a bizarre system, I couldnt believe that my Japanese co-workers thought this was normal and were even grateful for the “bonus”, I just saw it as what they owed me and though it unfair that they were pocketing the interest and not me.
      I then found out my health cover and other “perks” were deducted from my salary. so all they were offering was the convenience of shifting my money for me and limiting my choice of health cover.
      heres some translation help for negotiating with Japanese employers…

      BONUS = we withold part of your salary for 10 months of the year so we can invest it or spend it ourselves. For 2 months of the year you will get paid salary + withheld amount but without interest.
      COMPANY HEALTH COVER = we can remove money from your salary every month before you even see it put it towards a health plan of our choosing (oh that happens to be one of our companies too and no you cant opt out)

    27. Banker Cat Says:

      Debito, it’s not irrelevant. Deflation is ‘inflation-related’ and that’s the crux of your double-whammy argument about how price-wage coupling without an accompanying adjustment in loan repayments is not fair.

      Honestly, I think your jab about the banks wondering about why loans are going into default, and your call for them to stop being greedy needed to be dialed back to reality. The reason I asked you if you were aware of risks at the time you were given the loan is that those were your risks to manage. The bank, on the other hand, has a caveat emptor of their own, i.e. to manage the probability that you will–for whatever reason–not be able to service the interest/principal payments on the loan. Their decision to ignore any discussions of adjustments until the “coverage ratio” dips below a certain value is less driven by greed, and more by blind adherence to bank rules, if I had to guess.

      Bankers have to deal with more volatility in their bonuses than government employees or college professors, and so if loan defaults are on the rise, then I doubt these folks at your bank are all that greedy.

      – If you’re hung up on the word “greedy”, fine. Would “excessive concern about profits” be more to your semantic tastes? And if you could rewrite the second paragraph in more lay terms for us less savvy with banking terms, that would be of great help. Not all of us here are writing for and working at banks.

      The point is — in lay terms — the bank has to realize that the terms of the loans have changed. Neither the assets nor the value of the very currency being paid in is the same as it was in 1997. And since the individual payer always has a lot less breathing room (and far less government support) than the bank when it comes to issues of default, it would behoove the banks to have a reality check and readjust the terms of the loan to reflect realities. Or else they’re going to get a lot more people defaulting — which helps nobody, not least the banks.

      Call it greed, call it blind adherence to rules, whatever — I can accept both. The point is, in a deflationary economy, the banks also have to adjust things. And they aren’t doing it, even though they can do so far easier than the individual loan recipient.

    28. E.P.Lowe Says:

      Philip Brasor had an interesting piece on the Bonus System and Mortgages this summer.

      This excerpt gives a flavor of the piece:

      June and December are bonus months, and 45 percent of Japanese people with housing loans have contracts that require them to pay larger amounts in these months than they do in other months, in some cases as much as five times.

      It’s depressing reading.

    29. Mike Says:

      “gaikokujin ghetto” LOL. Thats about what it is!

      There is an employment system on the U.S. bases here for Japanese called the Master Labor Contract. They used to pay big bonuses but they are cutting them out. Man you should hear the Japanese cry foul on that one. They used to let Americans get into the MLC but the Japanese at the HRO said it wasnt fair since it was the Japanese tax payers paying for a foriegner to work, even if its on a US base. There is a loophole in the contract that says any normaly residing citizen in Japan can apply. Now they require either you be a JN or a PR.

    30. Banker Cat Says:

      When you say the terms have changed, I assume you mean the assumptions underlying your obligation to repay the loan (current price levels, your annual income, the value of the asset) have changed.

      The terms are probably exactly the same, and that is what sucks. It sucks for you because you are paying a larger chunk of your income, and for the reason mentioned by E.P. Lowe, you may be getting asked to pay several months at once when bonus season rolls around (I know in many cases there is an option to make only 12 payments a year, which guards against this risk, although extending the life of the loan).

      But most home loans in Japanese are 30+ year instruments, with the bank holding some probability of being repaid earlier than the loan maturity. So they don’t expect their initial assumptions to hold true for the entire life of the loan. Instead, they try to manage the expected downside if the loan performance declines.

      When banks screen loan applications for stuff like straight corporate loans or mortgages, there are usually strict criteria in the form of certain ratios. One of those is the ratio of the loan amount to the value of the asset. In essence the bank guards against the change in the asset value over time by only loaning part of the cost of the asset, say 70%. If the borrower defaults and worse comes to worst they end owning the asset, even if they can sell it in a market for 75% of the original price, they can recover the amount they originally lent.

      Another ratio is debt to household income, which is related to what I called the “coverage ratio”, i.e. your ability to “cover”(pay) the repayment amounts with your income. Many banks have fast rules like nothing under 2 times coverage is allowed(the higher the multiple, the more conservative the loan criteria). So when you say that your income has dropped 22%, your multiple is dropping as well. According to the bank, they believe it can drop another 11% before alarms go off, and your loan gets classified as something that needs more regular monitoring.

      They don’t want to own your asset, and in this environment (particularly in Hokkaido) they don’t want to try and sell it to recover the amount they loaned you. However, they aren’t going to accept a request for readjustment without a convincing argument. There are attorneys that make a living off of representing clients who desperately need a solution to unmanageable loan payments or household debt. When the bank sees that need, and they hear that argument, a change in credit terms may be possible.

      But until then, they are your creditor, and you are one borrower in a huge portfolio of home loans, waiting for a critical mass of other like-borrowers to voice similar complaints so that the bank notices the trend and changes their rules…

      – Thank you very much for explaining the bank’s perspective and alternatives very clearly, and without snipes or digs.

    31. chuckers Says:

      One thing that should be kept in mind is that a bonus should be treated as that: a BONUS. If you get it, great! If you don’t, depressing but should be counted on. Live your financial lifestyle based on ACTUAL earnings, not ANTICIPATED earning. A bonus is ANTICIPATED earnings, not ACTUAL earnings.

      As has been shown, it is really easy to cut bonuses. They are NOT guarnateed.

      – Then we should be offered the option of bonus or not with higher monthly salary. And we should adjust international measurements of Japan’s personal income to reflect that. It has NOT been a “bonus” in the Western-understood concept until quite a while after the Bubble burst. It has been “deferred income”, moreover explained to the public as such.

      Let’s be a bit kinder in tone to those who are not getting what they expected, and not insinuate that they were foolish for believing otherwise.

    32. Mark in Kanto Says:

      Yes, the bonus system is a total fraud. As someone above said, it is a deferred salary, paid at the whim of the employer. But ask most of my local colleagues and they say: “hey, it is a good thing, because you need the money for buying appliances and the like. And the employers saves it for you.” Talk about being brainwashed.

      But hey, the bashing of the “bureacrats” could be a bit more nuanced–not all are government fat-cat types who get paid millions for doing nothing but screwing up the system to make it even worse. Many of the “bureacrats” are simply government workers, kept at low salaries working as hard as anyone in the private sector. Government jobs include many sorts of educators as well. Doing the same thing Debito is doing, at a pretty lousy salary by international standards.

      Many people who got jobs in the public sector (koumuin of some sort) did so because they thought their jobs and salaries were more or less safe. If you go into the private sector you have less security, sure, but when times are good you stand to earn a lot more. But salaries in public sector jobs (ie. the “bureacrats”) are now being linked to how the business world does, but only in bad times. So you get screwed twice. When the economy does badly, your salary goes down. When the economy does well and people in big companies are getting their salaries raised and “bonuses” increased the public sector stays the same. And on top of that the public screams and shouts (now supported by DPJ) that the average koumuin ought to get his or her salary slashed another 20 or 30 or 50 percent. But bankers and stock brokers and executives? Naa, they “earn” their bonuses and high salaries, because they are “so smart” or “work so hard” or do whatever else the current “market banzai” ideology and NHK and the newspapers trumpet.

      When I came here 12 years ago to take a government job as a teacher, my salary was quite good by US and European standards. Now thanks to the link to the business world, but only a downward link, I get paid a lot less than my colleagues outside Japan. Meanwhile my peers in the private sector are either earning a lot more than I am or are out of work entirely. But that is the risk they took, as far as I can see. As for me, the goal posts have been moved as the game progresses.

    33. iago Says:

      One thing that should be kept in mind is that a bonus should be treated as that: a BONUS. If you get it, great! If you don’t, depressing but should be counted on. Live your financial lifestyle based on ACTUAL earnings, not ANTICIPATED earning. A bonus is ANTICIPATED earnings, not ACTUAL earnings.

      As has been shown, it is really easy to cut bonuses. They are NOT guarnateed.

      On the contrary, my contract specifies that I will get a GUARANTEED bonus, equivalent one month’s basic salary, paid in June and another paid in December. It truly is deferred compensation.

      There are also performance related incentive schemes that are not guaranteed.

      “Bonus” may be the closest translation, but don’t assume the exact same nuances as the English word.

    34. M&M Says:

      Debito, Readers,
      There will be fees, but your best option may be a refinance (Search for 住宅ローン借り換え). Get a couple of quotes from other banks (as mentioned what they can offer will depend on the loan balance vs. property value, balance vs. income and credit rating). Assuming you can get a quote for a new loan, circle back and talk to your existing bank with the hopefully better offer for them to match/beat. It may well be easier/cheaper to stay with the current bank (but still with a “new” loan). Since your loan is quite old there shouldn’t be any prepayment penalty on your original loan.

      All banks have refinance programs (it is a great way to steal customers from other banks).

      Mizuho have a perfectly decent refinance program: http://www.mizuhobank.co.jp/loan/housing/refinance/refinance.html

      Shinsei have information in English which is pretty generic for all banks…Shinsei are probably more useful for houses in the Tokyo/Kanto area.
      http://www.shinseibank.com/english/housing/loan_syousai.html#02

      Regional banks may be good, but my experience is that they are less systematic and it is more hassle.

      Good luck and for what it is worth, remember that you are the customer and that the banks need to lend money to pay their bills!

    35. Banker Cat Says:

      “Good luck and for what it is worth, remember that you are the customer and that the banks need to lend money to pay their bills!”

      The operative phrase is ‘for what it’s worth’. If you (this ‘you’ is rhetorical, not Debito) choose to refinance, the amount that the bank will pay you is not necessarily based on the amount of your debt, but rather the value of the collateral. If the asset is a house, and the value has come down considerably in the past ten years, *and* the bank’s lending standards are more conservative given the amount of scrutiny paid towards their credit screening standards, then you may get less money than is needed to prepay the outstanding principal on the loan being refinanced. In order to cover the shortfall, another (unsecured, read: higher interest) loan may be necessary. Whether or not that is better than staying put with the current loan depends on a number of factors, including the value of the house and the probability that your income will rise/fall next year.

      Banks need to lend money, sure, but I don’t always think of it in terms of paying the bills. The bills are their depositors, and as anyone with a savings account here knows, you are basically storing your money with the banks for free. Banks need lending and the return it produces to try and keep their shareholders happy. Which is, of course, impossible…

    36. Douglas Says:

      When i was getting a bonus I always used my monthly salary for daily needs and got by (with a little extra for savings etc) and then when the fat injection of cash came around I would buy a reward for myself – didn’t have the responsibility of a mortgage hanging over my head though. Still – it’s a good way of controlling the populace while looking generous at the same time IMHO. As an after thought to what M&M said – a friend came into some money and tried to pay the outstanding loan on his house mortgage right there and then – you should have seen the bank trying to advise against this action. How about investing it in this bond etc. the bank is making a FORTUNE off of the interest on loans, so that any kind of hint that the loan could be moving to another bank could well have them agreeing to some kind of discussion.

    37. Mark in Yayoi Says:

      The point is, … the banks also have to adjust things. And they aren’t doing it, even though they can do so far easier than the individual loan recipient.

      Debito, forgive the criticism, but they in fact do this very thing: that’s what a variable interest rate is for. In order to get people to borrow more and spend more, the BoJ has lowered their interest rates, which means that the interest on loans in general, whether the bank paying it out or taking it in, is lower.

      Had you anticipated the current decline in interest rates — and there’s no embarrassment in not having done so; the last few decades have seen inflation ravage the value of people’s savings while forcing big interest payments on debtors, so the conventional wisdom during inflationary periods is to get a fixed rate loan and then change banks if the economy improves and interest rates settle down — your payments would have gone down when your variable rate also went down.

      I myself am benefiting from that situation — I needed to borrow money a year ago to buy my condo, and was forced into a variable rate loan to pay the real estate agent’s fees and remodel the place to that it was livable. A normal buyer would pay cash for that stuff, and then only put 50% or so in as a down payment, with the rest covered by a home loan at a very low fixed rate (1.6% was the lowest I could find in 2008). For me, not being a Japanese national or PR, home loans were out of the question, so I had to pay the entire principal myself and then, for the other stuff, take out a personal loan at a much higher interest rate: 3.875%, variable. (Yes, a great deal in most countries. Not here.)

      Then in mid-2009, the bank lowered the rate to 3.475% to reflect the state of the economy. Had interest rates gone up instead, I would have been left paying more while the people with fixed rates, like yourself, were left unscathed. Let’s say some more oil shocks sent inflation into double digits and my interest rate to 15% per year — I would have been ruined! As it is, I’m saving about a thousand yen per month.

      Most people want a fixed rate loan, because if inflation should send prices upward, you’ll be protected from a concomitant increase in the interest on your loan. And at the same time, if interest rates go down, a rival bank will be looking to take over your loan at a better rate (if not your own bank renegotiating your loan so that you don’t jump ship). This generally means that borrowers have a lot of leverage over banks, because the borrowers can always negotiate their rates downward, but the banks can never demand more interest once a fixed-rate loan has been made.

      So if Takugin won’t lower your rate in this way, you need to start making pitches to other banks and get today’s lower interest rates.

      The fixed-versus-variable interest conundrum doesn’t really have anything to do with the bonus system. If you’re afraid that your employer will cut your “bonus” or otherwise pull shenanigans with your salary, you can always estimate your annual income and then arrange a loan repayment plan in which you pay 1/12 of your annual repayment each month. Doing this is a great way to avoud stress at bonus time.

    38. Doug Says:

      I agree the typical Japanese bonus system is kind of unfair. I think it is also a bummer that some banks write loans around the bonus system.

      I have a small engineering business in Japan and have set the bonus up to be paid one time at the end of the fiscal year (paid with April salary). The bonus is completely performance based (based on company profitability and individual performance). All of the employees seem to like this system as their base salary is equal to or greater than typical engineers make in Japan including their bonuses. Of course if the company performance is bad then there is no bonus. I have been doing this for years and it is definitely a “win/win” situation.

      I do understand why companies like paying a high percentage of the income as a bonus. Several years ago the witholding taxes for bonus salary were much less than for the normal salary. This changed about 5 years ago I believe. So paying a higher bonus (especially for large corporations with huge payrolls) would result in a huge tax savings (lower amounts for company contributions for insurance).

      I think something definitely needs to change as the wages in Japan are quite depressed related to the cost of living and companies lowering bonuses are in alot of cases like an actual pay decrease for the employee.

    39. 有道出人「いい加減日本のボーナス制度廃止しようぜ」 – 考える人たち Says:

      [...] http://www.debito.org/?p=5480 [...]

    40. J. Hart Says:

      I worked for a very well known research institute here in Kansai for thirteen years on a series of one year contracts before being non-renewed last year. I never heard of anyone hired on a yearly contract ever receiving a bonus. All foreigners, with one single exception in the last twenty years, were hired on a contract basis.

    41. snowman Says:

      Gosh, 13 years on a series of 1 year contracts?? This admirably demonstrates why Japan will never be able to attract good highly skilled foreigners to its shores. Outrageous!

    42. James Annan Says:

      I’m on my 9th, although we do have a gentleman’s agreement that they run in batches of about 5 (meaning I’m virtually guaranteed to get 13y, though this is not legally binding). Yes I agree it’s pretty outrageous, though in other ways I’m happier here than I would be in the UK.

    43. Johnny Says:

      Had a number of job-offers when I returned to Japan, and some of them were from Japanese companies, some from Western companies.

      The Japanese companies all offered me 1 year contracts. The Western companies all offered me permanent positions.

      No prizes for guessing which way I went.

    44. Banker Cat Says:

      English translation of Japanese article excerpt from Friday:

      “Financial institutions are promoting the housing loan business, but they face increasing difficulties. The number of housing starts has decreased sharply in the wake of the financial and economic crisis, and will drop below one million in 2009 for the first time in 42 years. While it has become difficult to win new contracts for housing loans, individuals’ income has decreased and repayment delays by existing loan users have increased. Lenders are forced to waive or reduce commissions and respond to requests for change of repayment terms under the newly instituted law. Some lenders are working with house builders as part of their “upstream strategy.” Some regional banks are winning a growing number of loan contracts in neighboring prefectures. With the corporate demand for funds slowing, banks have reached a turning point in housing loans strategy which they had expected to be profitable. (Nikkin P1 12/18)”

    45. Michael Weidner Says:

      It must be nice to get a bonus. Eventhough I work full time hours, since my status is only that of a part-time employee, I am not elegible for a bonus. I also am only on 1-year contracts which also means they could “fire” me without having to pay severance if they wait until my contract expires.

      I wish I had the fortune of getting a bonus. It looks like most businesses and other sectors like the education one are going this way more and more in order to save money for the bottom-line.

    46. Japan’s employment laws, as Japanese companies apply them to non-Japanese « Hoofin to You! Says:

      [...] one example, poster J. Hart on debito.org points out a situation where he had been employed on a series of thirteen annual contracts, before being [...]

    47. Joe Says:

      Like the famous saying goes, “you don’t get what you deserve, you get what you negotiate” If you agree to join a company on a one-year contract, then you’ve set a precedent that pretty much locks you into that arrangement permanently, as it is usually in the company’s best interests to have that flexibility.

      Best thing to do is to refuse to accept a yearly contract offer in the first place. But if you do, the next best thing is to make yourself as irreplaceable as possible before your next renewal, put off signing anything else until just a couple of days before your old contract expires, then play hardball with the renewal terms. You should have the leverage to get whatever you want at that point.

    48. James Annan Says:

      “Leverage” would require changing the employment system of the company (or non-governmental agency, as I think it would be properly referred to). I don’t believe there is the slightest chance of my achieving that in my lifetime, even if everyone in the building agreed with me (which they probably already do). I have my doubts about the legality of the system which appears to be designed explicitly to evade the constitution and labour laws (had a complete joke of an “interview” a few years ago where I “applied” for another term-limited post which was a direct continuation of my existing work), but as a mere foreigner (and up against a govt-supported bureaucracy) I know I don’t have a snowball’s chance in hell of a meaningful legal judgement so there is little point pursuing that angle.

      I do complain about the situation at every opportunity, which is rare enough, but the bottom line is I get paid significantly more than I would earn in the UK, and more importantly have a very cushy and well-supported work environment. I can still remember what it was like in a struggling underfunded UK lab with a “permanent” job where more people left through redundancy or early retirement than due to retirement at the standard age. While I must admit I have occasionally considered leaving, it would be cutting off my nose to spite my face.

      Um..that’s a bit of an off-topic ramble, sorry I should get my own blog :-)

    49. Jetboy Says:

      My opinion is that for Japanese people it’s different, and it is actually a “bonus”.
      Personally I get no bonus and am happy with my salary here.

      That said, I can feel the pain of the bonus system. When I told my wife’s father how much I’m making his initial reaction was “WOW!!! THAT’S THE SAME AS ME!!!!” (I’m much younger than him and he’s in a senior position.) The difference? He gets an extra 6 months salary on top of that… usually.

      So this year when his boss said “here’s 3 man yen… good job mate” he almost puked. He’s in a senior position, doing a LOT of work, and literally got paid exactly the same as me. I’m happy with my salary for a young bloke… but it’s 60 or so… he should have the dignity of at least twice what I’m making regardless of the economic situation as he’s in a senior position and has a lot of experience (also he works for a company that performed well, so quoting poor economic times was pretty silly.)

      But… he didn’t see it all the same way as me. It’s the way of the Japanese, and as you know, the economy’s bad… so I’ll settle for a kick in the balls while I’m down and out. I guess he doesn’t have the option of leaving when people treat him like this? Japan’s his home country and he gets a decent salary when compared to many people…

      On the other hand, I have the option of going to any country where English is spoken (any commonwealth country will let me in pretty easily.) So I don’t have to accept constant kicks in the balls for no reason, I can walk if the going gets tough, and my boss (in Japan) knows that, so treats me well.

    50. Timothy Takemoto Says:

      Why not just view the bonus as a bonus? I see it as that part of my salary that may disappear if the economic circumstances of my company are not good. A bonus. Er…durr…What am I missing?

      – Again, it’s not touted to the J public as a “bonus”, but deferred salary. Read previous comments.

    51. Off to file those Japanese taxes today! « Hoofin to You! Says:

      [...] bill for 2009, and not the kind of income I had had before. (I am starting to sound a bit like Debito on the income side, but, yeah, this is a country where you can have it and suddenly have less. Or incrementally have [...]

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