According to a statistical survey of graduate engineers from universities and technical colleges, the total number of engineers in Japan in 1920 was 1, 400, 2.8 times as many as ten years earlier; of these 73% were employed in private industry. Employment in metal, electrical, chemical and engineering industries marked 5-13 times increases in ten years, indicating the rise of heavy and chemical industries during the First World War. Seventy firms, of which 20 were founded between 1910 and 1920, employed more than 20 engineers, against 20 firms in total in 1910; and 11 firms employed more than 100. Increasing the number of engineers within a firm would naturally lead to the ordering of engineers by age. Thirty-six large firms hired engineers in specific subjects who had graduated almost every year from 1905 until 1919, suggesting the origin of the “Japanese management” practice of employing freshmen each year and letting them climb up the ladder of positions. More than 100 firms had several engineers in top management with the title “manager” or “chief engineer”; most of them had graduated during the 1890's, although few of them had seats on the board with their capitalist employers. Recently established steelmaking or shipbuilding companies had recruited veteran engineers through transfer from related Zaibatsu firms or through head-hunting from public or private concerns. For the first time in Japanese business history, several firms erected laboratries during the war. These firms were employing young physicists and chemists who had graduated from science faculties of the universities in addition to engineering faculty graduates.
During World War I, Mitsubishi Goshi opened branches in Europe and America for the company's overseas activities. In this paper, I have analysed the motives, activities and the results of such development by focusing on the London Branch in England. Before the war, the company had its foreign branches only in China, and most of the overseas activities had been conducted through foreign commercial houses. When the war occurred, the company felt it difficult to export to Europe, so the company switched its export trade from Europe to Russia via Vladivostok. But again, as Russia suspended gold standard, the company faced another difficulty to take foreign exchange risk. Since the company had to import goods such as machinery or raw materials, it was indispensable to promote export for acquiring a steady supply of foreign currency. In order to meet such needs, the company opened its branch office in London 1915 and New York the next year. The London Branch sold the company-made non-ferrous metal such as copper or Chinese products, and purchased machineries and materials for the company's shipyard. The accounts for these transactions were settled by the foreign exchange in the firm. The purchasing was soon exceeded by selling, so a trade surplus was accumulated in the branch office. With the purpose of making use of these surplus funds, the company went into the common exchange business. On the other hand, Japan was enjoying a war boom, and the Trading Division of Mitsubishi Goshi decided to add other company products to its own line; thus the company turned to a general trading enterprise. With corresponding to such a transformation, the company decided to enlarge the scope of overseas activities, resulting in the opening of agent offices in such cities as Paris, Seattle, Berlin, Rome, Lyon and Marseilles. These activities of the foreign branches became a precondition for further growth of the foreign exchange business of the Bank Division as well as of the proper business of the Trading Division of Mitsubishi Goshi. Later the foreign exchange business of these branches was transferred to Foreign Exchange Division of Mitsubishi Bank, and their trading business was to Mitsubishi Shoji (Trading) Company.