Abstract
This paper aims to clarify the labor market segmentation by firm size experienced by young Japanese workers in their transitions from non-regular to regular employment. According to the dual labor market theory, in Japan there are unequal opportunities for upward mobility among sectors, depending on firm size.
The author investigates (i) the effect of a worker's first job and labor market conditions on his or her transition, and (ii) the relationship between a worker's sector in non-regular employment, and that in regular employment, by applying a competing risks model to retrospective job career data. The data set used for this analysis is from the Social Stratification and Social Mobility Survey conducted in 2005, which contains detailed work history information. The analysis is restricted to respondents who were between 15 and 39 years of age, whose first employment status was non-regular employment, and who were not married when they entered the labor market.
The results show that professionals are more likely to gain regular employment in large firms or in the public sector, whereas skilled manual workers are more likely to find regular employment in small firms. Labor market conditions at the time of their transition affect the workers' chances of finding regular employment in large firms or in the public sector, while labor market conditions at the time of entry affect the possibility of being offered regular employment in small firms. It was also found that respondents who belonged to large firms or who worked for the public sector were more likely to get regular employment in large firms or in the public sector.
We find that these results are consistent with predictions made using the dual labor market theory. Our findings indicate that young Japanese workers' transitions from non-regular employment are embedded in a two-tiered youth labor market structure.
