2010 January 13 - 19 [
ECONOMY]
Large corporations accumulate huge net profits as ‘internal reserves’
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January 14, 2010
Japan’s top 5,000 major companies capitalized at 1 billion yen or more are increasing their savings under the name of “internal reserves” even though their sales and profits have fallen due to the global economic recession.
The National Confederation of Trade Unions (Zenroren) and the Japan Research Institute of the Labor Movement (Rodo-soken) recently published findings that show clearly that large corporations are gaining strength at a time when job security is being undermined and small- and medium-sized businesses are in financial crisis.
The report entitled “White Paper for People’s Spring Struggle” contains the details of the state of the Japanese economy and the conditions of the working people.
It points out that large corporations are accumulating their “internal reserves” by holding down wages as well as unit prices for supplies from subcontractors and increasing the use of contingent workers. They have also been able to save funds because their capital investments are decreasing due to falls in national income.
Toyota Motor Corp. decreased its internal reserves by 530 billion yen but still has 1.34 trillion yen, or 41.78 million yen per worker. By reducing its inventory and personnel, Toyota’s assets have decreased but it increased the ratio of internal reserves to its assets.
Nissan Motor Company is implementing its corporate restructuring scheme to cut 20,000 jobs in Japan and abroad while keeping 23 million yen per worker in internal reserves.
Sony will carry out 18,000 jobs cuts (including 8,000 full-time employees) in Japan and abroad, but it has increased its internal reserves by 12.7 billion yen, or 20 million yen per worker.
In the NTT group, its mobile phone carrier NTT docomo is restructuring itself, including 110,000 job cuts, while accumulating internal reserves of 4.94 billion yen or 187 million yen per worker.
Zenroren and Rodo-soken state, “Large corporations must fulfill their social responsibility by using a part of their internal reserves to help to expand domestic demand and improve working people’s livelihoods.”
- Akahata, January 14, 2010
