A Comparative Analysis of Job Entry Methods in Japan, the U.S. and Europe

Author Name HIGUCHI Yoshio  (Faculty Fellow) /KODAMA Toshihiro  (Senior Fellow) /ABE Masahiro  (Faculty Fellow)
Creation Date/NO. July 2004 04-J-036
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Focusing on job entry methods used by job switchers, such as "employment agencies", "advertisements" and "friends and relatives," we conducted a study comparing Japan, the U.S. and major European countries (Denmark, France, Germany, Italy, the Netherlands and the U.K.) to examine the relationship between the job entry methods and labor market outcomes as indicated by the "no-job duration" (the time between leaving one job and starting another) and the wage change (the difference between wages in the former job and the current job), through descriptive statistical analysis and regression analysis of micro data from each of the target countries. We conducted the analysis concerning Japan ourselves, while analysis of the U.S. and Europe was conducted by Hashimoto (2004) and Fahr and Schneider (2004) in response to RIETI requests. This paper uses the results of these three analytical studies to compare Japan, the U.S. and Europe.

The results of the comparison confirmed that in all three regions "public employment agencies" fulfill the role of providing a job search method for workers who are disadvantaged in the labor market, such as those who were separated from their jobs involuntarily, those with a low level of formal education, and older workers. They also confirmed that in most countries "private employment agencies" achieve relatively better labor market outcomes. Furthermore, as far as the data up to 2000 used for the study indicates, in Japan there is still room for improvement in labor market outcomes achieved by "public employment agencies" relative to other entry methods, compared to Europe and the U.S.