December 20, 2010
While on a recovery track, many large corporations across Japan are withdrawing or closing their factories. In Azumino City in Nagano Prefecture, famous for its precision machinery industry, Japan’s major information equipment manufacturer announced that it is suspending business transactions with its subcontractors. This has become a serious problem.
The big information instrument company, Seiko Epson Corporation (Suwa City, Nagano Prefecture), this spring notified three subcontractors, including Azumi-Seiko Corporation and Nan An Seiko Corporation, of the plan to suspend business with them.
Each of these companies received orders from Seiko Epson for more than 30 years and they relied on supplying watch parts to Seiko Epson for most of their business earnings. Because Seiko Epson enforced the suspension, one of the three companies was forced to close its plant and dismiss all of its employees at the end of March. The other two companies are also facing the same situation.
Seiko Epson’s decision to discontinue orders will lead to a total of about 200 job losses in the three companies. It also deals a heavy blow to the Azumino City government’s procurement of tax revenues and will adversely affect the local economy.
As the reason for cutting out its subcontractors, Seiko Epson cited the shrinkage in the global market for information equipment leading to a decrease in production. However, the company’s consolidated sales marked 985.3 billion yen in 2009 and its internal reserves amounted to 306 billion yen. This indicates that Seiko Epson is still the largest company in the prefecture.
Most of the workers at Azumi-Seiko and Nan An Seiko joined the All-Japan Metal and Information Machinery Workers’ Union (JMIU) for help in securing their employment. They have held a street action in front of the Seiko Epson’s headquarters calling on the company to agree to hold negotiations with the unions. On December 5, 450 union members and their supporters held a rally to protest against the company’s decision.
The unions urge both companies’ owners to reject Seiko Epson’s unreasonable suspension of doing business with them and to take all possible measures, in collaboration with the workers, to keep the companies in business in order to maintain jobs.
The JMIU filed a complaint with the Ministry of Economy, Trade and Industry claiming that Seiko Epson’s abandonment of its subcontractors violates the Subcontract Small Enterprise Development Act. As a result, the Ministry in October instructed the company to resolve the issue through negotiations with Azumi-Seiko and Nan An Seiko.
When Japanese Communist Party representative Kokuta Keiji at the November 10 House of Representatives Budget Committee meeting took up the issue of large corporations’ cutbacks at their factories, State Secretary for Internal Affairs and Communication Suzuki Katsumasa said that 840,000 workers in total, including 760,000 workers in the manufacturing sector, lost their jobs between September 2010 and September just 2008 before the “Lehman Shock” occurred.
Citing the fact that big businesses reported high profits in their mid-year accounts for the period ending September 30, Kokuta stated, “Large enterprises have enough financial strength to maintain employment. The need for the government is to establish the rules and regulations to force major companies to protect jobs and not harm local economies.”
- Akahata, December 20, 2010
The big information instrument company, Seiko Epson Corporation (Suwa City, Nagano Prefecture), this spring notified three subcontractors, including Azumi-Seiko Corporation and Nan An Seiko Corporation, of the plan to suspend business with them.
Each of these companies received orders from Seiko Epson for more than 30 years and they relied on supplying watch parts to Seiko Epson for most of their business earnings. Because Seiko Epson enforced the suspension, one of the three companies was forced to close its plant and dismiss all of its employees at the end of March. The other two companies are also facing the same situation.
Seiko Epson’s decision to discontinue orders will lead to a total of about 200 job losses in the three companies. It also deals a heavy blow to the Azumino City government’s procurement of tax revenues and will adversely affect the local economy.
As the reason for cutting out its subcontractors, Seiko Epson cited the shrinkage in the global market for information equipment leading to a decrease in production. However, the company’s consolidated sales marked 985.3 billion yen in 2009 and its internal reserves amounted to 306 billion yen. This indicates that Seiko Epson is still the largest company in the prefecture.
Most of the workers at Azumi-Seiko and Nan An Seiko joined the All-Japan Metal and Information Machinery Workers’ Union (JMIU) for help in securing their employment. They have held a street action in front of the Seiko Epson’s headquarters calling on the company to agree to hold negotiations with the unions. On December 5, 450 union members and their supporters held a rally to protest against the company’s decision.
The unions urge both companies’ owners to reject Seiko Epson’s unreasonable suspension of doing business with them and to take all possible measures, in collaboration with the workers, to keep the companies in business in order to maintain jobs.
The JMIU filed a complaint with the Ministry of Economy, Trade and Industry claiming that Seiko Epson’s abandonment of its subcontractors violates the Subcontract Small Enterprise Development Act. As a result, the Ministry in October instructed the company to resolve the issue through negotiations with Azumi-Seiko and Nan An Seiko.
When Japanese Communist Party representative Kokuta Keiji at the November 10 House of Representatives Budget Committee meeting took up the issue of large corporations’ cutbacks at their factories, State Secretary for Internal Affairs and Communication Suzuki Katsumasa said that 840,000 workers in total, including 760,000 workers in the manufacturing sector, lost their jobs between September 2010 and September just 2008 before the “Lehman Shock” occurred.
Citing the fact that big businesses reported high profits in their mid-year accounts for the period ending September 30, Kokuta stated, “Large enterprises have enough financial strength to maintain employment. The need for the government is to establish the rules and regulations to force major companies to protect jobs and not harm local economies.”
- Akahata, December 20, 2010
