Wednesday, May 23, 2012

Noah Smith - In defense of private equity: Japan.

Although it's hard to measure white-collar productivity, anecdotally, it is horrendous in Japan. Employees sit idly in front of their computers waiting for the boss to leave so they can go home, or make busy-work for themselves, copying electronic records onto paper (yes, this is real!). Unproductive workers are kept on the payrolls because of lifetime employment, with high salaries guaranteed by the system of seniority pay. To this, add endless meetings, each of which must be exhaustively prepared for in advance. Layer upon layer of bureaucracy with poorly defined accountability. Pay based entirely on tenure rather than merit.
Read it at Noaphinion
In defense of private equity: Japan.
By Noah Smith

If the title hadn’t mentioned Japan, would you have thought the above statement was about US companies? If so, were you imagining the private or public sector?

Based on stories from friends, the above office depiction is not too dissimilar from various public sector jobs in the US. Some people may view the ease of this employment as ideal but on a large scale it certainly won’t lead to the productivity or technological advancement that is critical for improving our standard of living.

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