*Note: This is a provisional translation for reference purposes only.
Tuesday, June 20, 2023
Press Conference Room, METI Main Building
I would like to mention two points.
First, I would like to announce the results of a survey on the status of price pass-through in March, which was designated as Price Negotiation Promotion Month.
The first panel shows the price pass-through rate, which indicates the extent to which cost increases have been passed on to prices. The rate, which was 46.9% in September, improved slightly, to 47.6%.
The share of companies that were completely unable to implement price pass-through rose slightly, from around 20% to 23.5%. On the other hand, the share of companies that achieved price pass-through also rose, from 35% to around 40%. In a sense, bipolarization is proceeding. While some progress has been made, many companies were unable to implement price pass-throughs.
We also classified the results by industry, which shows that the rate for the trucking industry is low as usual and the rate for broadcast content is very low.
Both energy and labor costs improved 5 percentage points each. For further details, the administrative staff will provide a briefing later.
Let us move on to the next slide. Starting in July, we will help SMEs acquire skills related to the cost calculation method by establishing counters for supporting price pass-through at yorozu general support stations across the country.
Let us move on to the third panel. Going forward, we will publish a list of order-placing companies with their status of price negotiation and price pass-through, as we did previously, while the ministers in charge of respective industries will give guidance and advice to top management.
Second, inspectors in charge of monitoring subcontracting businesses have gathered a variety of information through interviews and other means, so we will use the information to ensure that industry associations’ voluntary actions will be improved and thoroughly implemented.
In any case, prices of various materials and goods are rising. At a time when labor and energy costs are rising, it is important that entire supply chains, including order-placing companies, share the burden and aim to achieve co-existence and co-prosperity while doing so.
For large companies as well, by shifting the burden to SMEs and subcontractors or refusing to accept price pass-through, they will end up hurting themselves. As SMEs will not be able to survive with the heavy burden placed on them, I hope that large companies and order-placing companies will engage in price negotiations and accept price pass-throughs.
Let us go back to the first slide. In the case of the trucking industry, if price pass-through cannot be implemented when transportation charges are as low as now, it will become difficult to transport goods. Therefore, I would like the trucking industry to engage in negotiations with an aggressive stance. Amid labor shortages and rising costs, hopefully, they should engage in negotiations and consignors should accept price pass-throughs. Otherwise, consignors will end up hurting themselves as it becomes difficult to transport goods. They should take the current situation seriously, engage in price negotiations, and accept price pass-throughs. We are facing a crisis that requires survival efforts by entire supply chains. Therefore, I hope that the companies concerned will take actions in light of the survey results.
Second, regarding the program to support career advancement through reskilling under the second supplementary budget in FY2022, 75 billion yen has been appropriated. At this time, 51 cases have been adopted and around 20 billion yen will be provided in subsidies.
To earn higher income, career advancement is first and foremost necessary, so I hope that workers will achieve career advancement, regardless of whether they do so through internal transfer or by moving to another company, or whether they are regular or non-regular workers, while companies invest in human resources, including by raising wages. The government will support career advancement while assisting various initiatives.
At this time, as part of government-wide support efforts, METI will support people seeking to achieve career advancement with an eye to moving to another company. Of the 50 cases adopted for the reskilling support program at this time, 40% are related to programming, and if training related to business skills is included, the share rises to around 60%. We would like to provide support for general training as well as training in such fields as medical and nursing care, and digital technologies including web design and video editing.
In particular, until now, regular employees at large companies have pursued career advancement along a single path within their respective organizations in the closed world of lifetime employment, while mobility has been lacking in the labor market. Recently, there has been eagerness for career achievement, not limited to internal advancement, mainly among young people. Therefore, we would like to provide support in a way that enables those people to achieve career advancement and income growth by taking advantage of the reskilling support program.
As I am announcing the cases adopted for the reskilling support program, hopefully, workers should review their careers and participate in projects suited to their own needs while considering the future of their lives, how they should develop their career, what skills they should acquire, and what experience they should gain.
I will explain some examples of the cases adopted at this time in the following slides. One company, which was established about 10 years ago, plans to specialize in reskilling training for women, especially in their 20s to 40s who are worried about life events, such as marriage and childbirth, in returning to their previous workplace or acquiring skills useful for remote work, including IT skills.
The second example is a company planning to support relatively younger generations of workers, those who are in their third to fifteenth year with their present employer, and who are in their 20s to 40s, in accumulating experience in preparation for moving to startup firms. The company provides support for moving to startups and developing a mindset to focus on growing a small organization, rather than working within a large organization. Show the next slide, please.
The third company was also established around 10 years ago. It plans to support the acquisition of digital skills by workers who have performed various sorts of tasks as a generalist at a large company, including relatively old workers, so that they can develop practical abilities, such as formulating plans for addressing corporate challenges, and consider moving to SMEs.
The next slide shows the case of a new company planning to support people who faced a very difficult situation due to the COVID-19 crisis, such as workers in the apparel, bridal service, and eatery sectors, in acquiring skills necessary for marketing, digital marketing, system development, and web development. This is a support service targeted at relatively young workers. We have adopted a great variety of reskilling projects, including those targeted at women, young people, and middle-aged and older workers, and those in fields such as digitalization and services. This program is open to both regular and non-regular workers. In any case, the government as a whole will promote initiatives to enable workers to achieve career advancement and income growth—regardless of whether they are regular or non-regular workers, or whether they pursue career advancement while staying with their present employer or by moving to another company—as part of investment in people, which is at the heart of the Kishida administration’s policymaking. METI will also provide firm support in this way.
That is all I have to say.