As recession grips Japan, a 'bubble economy' bursts Belt-tightening is a new way of life

December 06, 1992|By John E. Woodruff | John E. Woodruff,Tokyo Bureau

TOKYO -- From designing computer software for TV factories to stuffing moving company fliers into apartment mailboxes is a trip from $3,200 a month take-home pay to $64 a day when there's work.

Hiroshi Murakami, 34, covered the distance in about a half-year, with stops en route to teach language in a cram school and collect market data door-to-door for a watch company.

Mr. Murakami's story is one among millions about what has happened in Japanese lives in the two years since the "bubble economy" burst at the end of the 1980s, creating the worst slowdown the world's No. 2 economy has known in a half-century.

Most are less dramatic. Executives at Japan's corporate giants swallow hard before resorting to anything that would take the luster off their companies' reputations as "lifetime employers."

More common are stories of smaller bonuses or an end to overtime pay, of educations interrupted or new cars deferred.

Government figures published last week made it official that for the first time since the 1973-1974 oil shock, Japan has met the usual international definition of a recession: two consecutive quarters of what economists insist on calling "negative growth."

Gross domestic product fell by 0.2 percent in the April-June quarter and by 0.4 percent in the July-September quarter, the Economic Planning Agency reported. But the EPA, which defines the word in its own way, does not yet acknowledge that Japan is in a recession.

The stories, taken together, add up to millions of personal realities behind the flood of numbers. Stories like these:

* Osamu Wakide, 69, of Matsuzaka had the kind of bittersweet year that only a slowing economy can bring to a cattleman. His pride and joy, Yasukogo, won the grand championship last month at the annual exhibition of famed Matsuzaka beef, a high point that makes any cattleman glow. And ought to make his bank account grow. But at auction, Yasukogo commanded only $160,000, well under the $396,000 bid that the grand champion brought at the peak of the economic boom in 1989.

* A couple in Oji, north of Tokyo, were charged with pushing the wife's mother off a bridge to her death when she asked them to repay a loan. Tokyo police list a record-high 27 murders as economy-related this year, with the costly and stressful pre-New Year's holiday period still ahead. A stock broker is charged with killing a woman and taking $4,000 from her to pay overdue interest on a $160,000 loan.

* Yoshimi Tanaka, a nightclub guitarist and singer, gets as many gigs as ever but is making $3,300 a month for work that brought in $4,800 a year ago. Bar owners can't pay as much, he says, and he feels lucky -- lots of entertainers made $3,000 a month a year ago and make $2,000 a month now.

One man's hard times can be another's bargain, of course, depending which side of a transaction you're on.

In 1989, when Japanese "bubble" beneficiaries were in love with art as investment, a prime-condition print of Picasso's "Le Repas Frugal" went for $490,000 at Sotheby's Tokyo auction. Two months ago a comparable copy went for $110,000.

For some apartment hunters who still have means, harder times have meant a chance to grab prestige digs at rents well off their most notorious "bubble" levels.

At Garden Hills in downtown Tokyo's Hiroo, a favorite address of Japanese TV starlets and foreign executives, a three-bedroom, two-bath place that cost the last tenant $6,720 a month is now available for a mere $5,440.

But most Japanese stories these days are more like those of executives at NEC, the struggling electronics giant. They will take an across-the-board 10-percent hit in their winter bonuses compared with last year. To soften it, a top executive will get chits he can turn in for $1,600 worth of company products. A junior manager will get $800 in chits.

Directly or indirectly, experiences like those are leading to big and little changes of lifestyle for millions of Japanese.

Nobutaka Hayashi, 32, was stuck to his travel agency desk until 10 p.m. or later in 1989 and 1990. These days he leaves by 7 p.m.

The number of Japanese traveling overseas was down 3.3 percent in 1991 from 1990, to 10.63 million, the first drop in 11 years. It is expected to drop again this year.

At the peak of the bubble, thousands of Japanese acquired a taste for using their country's position near the international date line to be among the first in the world to sample each year's Beaujolais nouveau wine.

In 1989, Japan Airline used seven Boeing 747 cargo jets to haul Beaujolais nouveau from France. One plane was enough this year.

In many ways, lifestyle stories tell more than statistics about how fast an overheated economy can cool even when official figures say unemployment has scarcely budged.

Unemployment still stands between 2 percent and 3 percent, a level many Americans might envy. Some economists expect it to get well above 3 percent before it peaks.

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