Since the 1990s, Japanese firms have shifted to hiring temporary workers rather than regular employees and have endeavored to minimize the cost of education and training against the background of labor costs being a burden on corporate profits due to excessive employment (Chart 5). 3.
Excessive competition among firms Excessive competition among firms stemming from protracted deficient demand may also have contributed to the decline in labor productivity. Since the 1990s, many Japanese firms have been drawn into fierce competition, cutting excessively the price of their products and providing extravagant services.