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Career mobility in the embedded market: a study of the Japanese financial sector

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Abstract

The coexistence of domestic and foreign firms in Japan provides a fascinating test bed through which to examine how local firms adapt to global pressures, and how employees navigate the changing institutional environment. I employ a mixed methods approach using in-depth interviews and two separate datasets of finance professionals in Japan. My analysis reveals that there is greater mobility and greater employee heterogeneity in the foreign firms. Mobility is a one-way transition from domestic to foreign firms, intermediated by status distinctions between firms. My findings also suggest that mobility in the foreign firms is constrained by local norms and conventions.

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Notes

  1. Based on author’s estimations using published data from the Ministry of Health, Labor and Welfare (MHLW). The lifetime employment rate was estimated from MHLW statistics using method described by Ono (2010). It measures the number of workers in the age group 50–54 who have never changed employers divided by the total number of workers in that age group. The ratios were also estimated for 2006 (to be consistent with data in the empirical analyses). The results showed little variation from the 2010 estimates. In 2006, 62% of workers in finance were employed in large firms and 43% were covered by lifetime employment; these numbers were 18 and 21%, respectively, for all industries.

  2. The NLI data were provided by the Social Science Japan Data Archive, Center for Social Research and Data Archives, Institute of Social Science, The University of Tokyo.

  3. Source: Nihon Keizai Shimbun. 2005. “Nomura soken, jiyu ou DNA” (Nomura Research Institute: Opportunities and freedom). September 19, 2005.

  4. We test for significance using the Z-test: \(Z = \frac{{(\beta_{ij} - \theta_{ij} )}}{{\sqrt {\theta_{ij} (1 - \theta_{ij} )/N} }}\) where βij is the observed frequency, θij is the expected frequency, and N is the sample size.

  5. I note one caveat here. In the three diagonal cells numbered 5, I am unable to distinguish between those who moved and those who did not. For example, in the category of top foreign firms, cell 5 includes analysts who did not change employers, as well as analysts that moved from one top foreign firm to another top foreign firm. The pattern of immobility is rare among the foreign firms and in the other domestic firms (as shown in Table 6), but we cannot rule out the possibility that the parameter estimates in these three diagonal cells may be confounded by this heterogeneous population.

  6. The one exception here is the transition from top foreign to other domestic (cell 11), and the transition from top foreign to other foreign (cell 12). The coefficient in cell 11 is more negative than the one in cell 12, but this difference is not statistically significant.

  7. Information obtained from Goldman Sachs, Japan homepage: http://www.goldmansachs.com/japan (last checked July 2018).

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  1. School of International Corporate Strategy, Hitotsubashi University Business School, 2-1-2 Hitotsubashi, Chiyoda-ku, Tokyo, 101-8439, Japan

    Hiroshi Ono

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Correspondence to Hiroshi Ono.

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Ono, H. Career mobility in the embedded market: a study of the Japanese financial sector. Asian Bus Manage 17, 339–365 (2018). https://doi.org/10.1057/s41291-018-0042-x

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