A Huawei company logo is seen outside a shopping mall in Shanghai, China March 7, 2019. REUTERS/Aly Song
March 18, 2019
GENEVA (Reuters) – Chinese telecoms giant Huawei led the pack with Asia accounting for more than half of the international patent applications at the World Intellectual Property Organization (WIPO) last year, WIPO said on Tuesday.
Huawei, which has been under pressure since the United States demanded its allies bar Chinese vendors from participating in building 5G networks due to national security concerns, made 5,405 patent applications to the U.N. body, up from 4,024 in 2017.
“It’s an all-time record by anyone,” WIPO director general Francis Gurry told a news conference.
WIPO oversees international treaties governing patents, trademarks and industrial designs. Its annual report on the applications it receives – a subset of all intellectual property filings globally – gives an early snapshot of the trends.
Asia-based filings accounted for 50.5 percent of the total applications received, Gurry said.
“Historically, this is really quite extraordinary,” he said. “Historically, this is a momentous occasion, this is something that is really a very, very significant result.”
The second-biggest user of the WIPO international patent system in 2018 was Mitsubishi Electric with 2,812 filings, followed by Intel with 2,499.
Although inventors in the United States filed more applications than in any other country, China looks set to take the top place this year or next, after a meteoric rise over the past quarter century.
Having filed only one patent application in the WIPO system in 1993, its applications overtook Japan’s in 2017 and grew by a further 9.1 percent to 53,345 in 2018, while the number of U.S.-based filings slipped 0.9 percent to 56,142.
Asia accounted for six of the top eight companies, with China’s ZTE Corp and BOE Technology Group and South Korea’s Samsung Electronics and LG Electronics also among the leaders.
China also jumped up the academic rankings, with four of its universities making the top ten list for the first time.
While the University of California remained well ahead among educational institutions, with 501 patent applications in 2018, and Massachusetts Institute of Technology was second, Shenzhen University and South China University of Technology leapt into third and fourth spot, just ahead of Harvard.
Gurry said Chinese universities benefited from an extremely strong emphasis on innovation and the commercialization of basic research, as well as access to the world’s second largest national pool of research and development spending.
He said China had introduced an equivalent of the U.S. Bayh-Dole Act, ensuring that patents taken out on government-sponsored research were being used, which may have had an influence on Chinese universities’ attitude towards commercializing their research.
The WIPO report represents applications for patents, trademarks and designs that their owners feel are valuable enough to protect and promote in overseas markets. Another WIPO report, released in December includes millions of applications for IP protection that are never filed overseas.
(Reporting by Tom Miles; Editing by Kirsten Donovan)
A new study from The Australian National University (ANU) has found a number of 2D materials cannot only withstand being sent into space, but potentially thrive in the harsh conditions.
It could influence the type of materials used to build everything from satellite electronics to solar cells and batteries — making future space missions more accessible, and cheaper to launch.
Ph.D. candidate and lead author Tobias Vogl was particularly interested in whether the 2D materials could withstand intense radiation.
“The space environment is obviously very different to what we have here on Earth. So we exposed a variety of 2D materials to radiation levels comparable to what we expect in space,” Mr. Vogl said.
“We found most of these devices coped really well. We were looking at electrical and optical properties and basically didn’t see much difference at all.”
Alex Jones reveals the truth behind China’s exploration of the dark side of the moon, an adventure that, in all likelihood, has already been carried out by covert, American run space programs.
During a satellite’s orbit around the earth, it is subject to heating, cooling, and radiation. While there’s been plenty of work done demonstrating the robustness of 2D materials when it comes to temperature fluctuations, the impact of radiation has largely been unknown — until now.
The ANU team carried out a number of simulations to model space environments for potential orbits. This was used to expose 2D materials to the expected radiation levels. They found one material actually improved when subjected to intense gamma radiation.
“A material getting stronger after irradiation with gamma rays — it reminds me of the hulk,” Mr. Vogl said.
“We’re talking about radiation levels above what we would see in space — but we actually saw the material become better, or brighter.”
Mr. Vogl says this specific material could potentially be used to detect radiation levels in other harsh environments, like near nuclear reactor sites.
“The applications of these 2D materials will be quite versatile, from satellite structures reinforced with graphene — which is five-times stiffer than steel — to lighter and more efficient solar cells, which will help when it comes to actually getting the experiment into space.”
Among the tested devices were atomically thin transistors. Transistors are a crucial component for every electronic circuit. The study also tested quantum light sources, which could be used to form what Mr. Vogl describes as the “backbone” of the future quantum internet.
“They could be used for satellite-based long-distance quantum cryptography networks. This quantum internet would be hacking proof, which is more important than ever in this age of rising cyberattacks and data breaches.”
“Australia is already a world leader in the field of quantum technology,” senior author Professor Ping Koy Lam said.
“In light of the recent establishment of the Australian Space Agency, and ANU’s own Institute for Space, this work shows that we can also compete internationally in using quantum technology to enhance space instrumentations.”
The research has been published in the journal Nature Communications.
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FILE PHOTO: A woman holds her phone near an Apple company logo in Beijing, China December 14, 2018. REUTERS/Jason Lee
March 15, 2019
By Stephen Nellis
(Reuters) – A U.S. federal judge has issued a preliminary ruling that Qualcomm Inc owes Apple Inc nearly $1 billion in patent royalty rebate payments, though the decision is unlikely to result in Qualcomm writing a check to Apple because of other developments in the dispute.
Judge Gonzalo Curiel of the U.S. District Court for the Southern District of California on Thursday ruled that Qualcomm, the world’s biggest supplier of mobile phone chips, was obligated to pay nearly $1 billion in rebate payments to Apple, which for years used Qualcomm’s modem chips to connect iPhones to wireless data networks.
The payments were part of a business cooperation agreement between the two companies amid the peculiar patent licensing practices of the consumer electronics industry.
In general, the contract factories that built Apple’s iPhones would pay Qualcomm billions of dollars per year for the use of Qualcomm’s patented technology in iPhones, a cost that Apple would reimburse the contract factories for. Separately, Qualcomm and Apple had a cooperation agreement under which Qualcomm would pay Apple a rebate on the iPhone patent payments if Apple agreed not to attack in court or with regulators.
In a lawsuit filed two years ago, Apple sued Qualcomm, alleging that the chip supplier had broken the cooperation agreement by not paying nearly $1 billion in patent royalty rebates.
Qualcomm in turn alleged that it stopped paying the rebate payments because Apple had broken the agreement by urging other smartphone makers to complain to regulators and making “false and misleading” statements to the Korean Fair Trade Commission, which was investigating Qualcomm over antitrust allegations. Apple responded that it was making lawful responses to regulators in an ongoing investigation.
Judge Curiel sided with Apple, ruling that Qualcomm owed the missed rebate payments.
“Qualcomm’s illegal business practices are harming Apple and the entire industry,” Apple said in a statement.
Don Rosenberg, executive vice president and general counsel of Qualcomm, told Reuters in a statement, “Although the Court today did not view Apple’s conduct as a breach of Apple’s promises to Qualcomm in the 2013 Business Cooperation and Patent Agreement, the exposure of Apple’s role in these events is a welcome development.”
The decision will not become final until after the trial in the case, which begins next month. And it is unlikely that Qualcomm will make a new payment to Apple.
Apple’s contract factories, which under normal circumstances would pay Qualcomm for patent royalties owed on iPhones, have already withheld the nearly $1 billion in payments to Qualcomm. Qualcomm’s Rosenberg said those withheld iPhone payments have already been accounted for in Qualcomm’s existing financial statements.
“Apple has already offset the payment at issue under the agreement against royalties that were owed to Qualcomm,” Qualcomm’s Rosenberg told Reuters.
(Reporting by Stephen Nellis; Editing by Cynthia Osterman)
A man works to load a container on a truck at an industrial port in Tokyo, Japan, February 22, 2019. Picture taken on February 22, 2019. To match Insight JAPAN-COMPANIES/CHINA. REUTERS/Kim Kyung-hoon
March 14, 2019
By Tetsushi Kajimoto
JOETSU, Japan (Reuters) – In snow country along Japan’s northern coast, a small manufacturer of precision moulds is feeling the pain of China’s economic slowdown.
Orders have slowed to a trickle at Nagumo Seisakusho Co, which supplies big auto-parts makers such as Denso Corp and Aisin Seiki Co, and the company may keep salaries flat or even reduce them in the coming fiscal year.
Manufacturers across Japan depend heavily on customers in China, the world’s second-biggest economy, to buy their products, especially the parts and equipment that reach China’s factory floor and fuel its domestic and export growth.
Automotive chipmaker Renesas Electronics Corp last week said it would suspend production at some plants for up to two months as it braces for China’s growth to slow further. In recent months, other big companies such as factory-robot makers Yaskawa Electric Corp and Fanuc Corp; Mitsubishi Electric Corp, trading house Mitsui & Co and toilet giant Toto Ltd have blamed China as they cut profit forecasts.
But the impact of China’s wobble is worse for manufacturers nearer the start of the supply chain, like tiny Nagumo. It employs 100 people to create precision press moulds other Japanese manufacturers use to make car parts and other products for the China market.
On the nondescript 4,000-square-metre (43,000-square-foot) factory floor in Nagumo’s main Sanwa plant, grey-clad workers, some wearing blue surgical masks, busied themselves during a recent day designing moulds by computer, then milling, stamping and assembling dies.
But the normalcy belies tough times for Nagumo, which makes all of its products on demand.
“Orders have stalled suddenly since January. Many of our clients are car-parts makers, and they have slammed on the brakes for orders recently,” at least through March, said president Hiroshi Komemasu.
“It is said that when China sneezes, Japan catches a cold,” Komemasu told Reuters recently on the factory floor. “I strongly feel that the trade war is affecting even small firms like us.”
The emptiest section of the facility was the busiest. Nagumo’s five sales staff were often out of the office hunting new customers to make up for the drop-off in orders.
The company, founded as a fiber-processing company in the immediate aftermath of World War Two, is based in Joetsu, a quiet city of about 200,000 people 225 kilometers (140 miles) northwest of Tokyo.
Far from the bustle of Japan’s biggest cities, Joetsu is known for a festival, a museum and a mascot celebrating an Austro-Hungarian general who taught cross-country skiing to Japan’s Imperial Army in the early 1900s.
Sharp slowdowns for upstream manufacturers like Nagumo bode ill for Japan as a whole, as smaller companies employ seven in 10 Japanese workers, and weak demand points to smaller shipments by bigger firms down the road.
Komemasu would not discuss Nagumo’s specific customers, but said one had slashed its orders by half.
Unlisted Nagumo managed to stay in the black for the 2018 calendar year, but probably lost money in the fiscal year, which ends this month, Komemasu said. Declining orders threaten its forecast of sales edging up 6 percent this year to 1.9 billion yen ($17 million).
Nagumo executives, worried about sales, have become reluctant to raise wages. After increasing base pay for three years, the company hopes to keep overall pay flat in the coming fiscal year, which starts in April, Komemasu said.
Such constriction could ripple through to other Japanese manufacturers – now in annual wage negotiations – reinforcing concerns that trade friction will hurt salaries and consumer spending nationwide.
Japanese giants such as Toyota Motor Corp and Panasonic Corp offered smaller pay increases at annual wage talks on Wednesday, tempering hopes that domestic consumption will offset external risks to growth.
Despite signs that U.S. President Donald Trump and Chinese President Xi Jinping may be nearing a truce in the U.S.-China trade war, the collateral damage for Japan may persist.
“The U.S.-China trade war won’t be resolved entirely. Both sides may reach a vague compromise, but that doesn’t mean everything will be rosy for China’s external demand,” said Toru Nishihama, emerging-market economist at Dai-ichi Life Research Institute.
“Downward pressure will mount on Japanese exporters and manufacturers as the global economy slows further,” Nishihama said, adding that as Beijing focuses on supporting the domestic economy, the authorities will tolerate slower demand.
Atsushi Takeda, chief economist at Itochu Research Institute, sees the China slowdown’s impact on Japanese companies lasting for months, countering an expected rebound in car demand late in the year from Beijing’s stimulus measures.
“But we need to bear in mind that the effects of trade friction will play out fully in Japanese exports and output in January-March and the following quarter, after the rush in shipments of Chinese goods to the United States seen late last year,” Takeda said.
“Semiconductors and cars will take a hit in the first half of this year, and other goods related to trade friction will follow suit in the second and third quarters, so the worst will come around April-June for Japanese exporters and manufacturers.”
Last year, about 38 percent of Japan’s exports were electronic parts, semiconductor-manufacturing equipment and heavy machinery used to make other goods, while the auto industry accounted for 23 percent, Finance Ministry data show.
Japan’s manufacturing supply chain, linking small firms like Nagumo to Japan’s industrial giants and consumers worldwide, is the China-reliant core of Prime Minister Shinzo Abe’s plan to lift Japan out of decades of deflation and fitful growth.
A much cheaper yen, driven by unprecedented money-printing from the Bank of Japan, has made the country’s exports more competitive globally. This has spurred a long export boom and record corporate profits, promoting hiring, creating the tightest labor market since the 1970s and delivering modest pay raises.
But domestic consumption has remained tepid and export demand – especially from China – has slumped, threatening to derail what could be Japan’s longest postwar expansion.
This year has seen the biggest monthly export drop in two years, with a plunge in China-bound shipments, a big drop in machinery orders signaling weaker capital spending ahead, a weak wage outlook and dampening business sentiment in the Reuters Tankan survey.
The government last month cut its assessment of factory output and profits, and indicators this month suggest the expansion may have halted.
In Joetsu, Kenichi Watabe, head of Nagumo’s general-affairs division, says the company has “managed to make ends meet as our sales staff dashed here and there trying to attract new customers and secure new orders.”
Nagumo’s workforce is now half its peak due to past layoffs, Watabe said.
But company president Komemasu said squeezing too hard would cause lasting damage.
“We, like everyone else, tell employees to turn off the lights and refrain from purchasing unnecessary things in a downturn,” he said. “But we won’t curb investment in human capital and R&D.”
(Reporting by Tetsushi Kajimoto; Editing by William Mallard)
Apple company logos are seen as two MacBooks stand next to each other in an office in Vienna, Austria January 3, 2019. REUTERS/Leonhard Foeger
March 14, 2019
By Stephen Nellis
(Reuters) – Apple Inc on Thursday launched a television advertising campaign promoting its stance on data privacy, seeking to differentiate itself from tech industry rivals such as Alphabet Inc’s Google and Facebook Inc that have become the target of regulatory scrutiny over the issue.
The 45-second commercial will begin airing on U.S. TV stations Thursday and run throughout the National Collegiate Athletic Association’s annual “March Madness” basketball tournament that draws millions of viewers, Apple said.
The ad will be shown in other countries later, but Apple declined to say whether it would air in China or how much it was spending on the campaign.
The spot shows a variety situations such as people closing window blinds, doors or shower curtains to seek privacy and says, “If privacy matters in your life, it should matter to the phone your life is on. Privacy. That’s iPhone.”
Apple Chief Executive Tim Cook has frequently spoken about the company’s position against the collection of personal data. In particular, Cook has singled out the assembly of profiles of consumers for the purpose of targeting advertisements – the heart of how Google and Facebook make money.
But the television spot is the first time the Apple has pressed the issue to consumers in a national ad campaign. Apple’s only previous privacy advertisement was a billboard at the Consumer Electronics Show in Las Vegas in January that said, “What happens on your iPhone, stays on your iPhone.”
Apple’s campaign comes as large technology companies are under unprecedented scrutiny of their data privacy practices. Google and Facebook have drawn consumer lawsuits and inquiries from lawmakers.
Both companies have said they are making changes to boost user privacy. Last week, Facebook founder Mark Zuckerberg said the company plans to encrypt more of the conversations happening on its messaging services, which could limit Facebook’s visibility into those conversations.
Apple’s primary rival is Google, which makes the Android operating system that powers most of the world’s mobile phones. Google this week said it is working on privacy enhancements for Android, such as locking down access to a phone’s camera and microphone.
For its part, Apple is trying to persuade consumers that it can provide competitive features, such as customized news reading lists, without Apple viewing their data.
Apple’s phones do collect data on consumers, but the company has said that it cannot view that data because it remains encrypted with a personal postcode on the user’s device or has identifying information stripped away before being sent to Apple.
(Reporting by Stephen Nellis; Editing by Tom Brown)
FILE PHOTO: Demonstrators burn Chinese goods and poster of Chinese President Xi Jinping during a protest organised by the activists of Swadeshi Jagran Manch, a wing of the Hindu nationalist organisation Rashtriya Swayamsevak Sangh (RSS), as they demand the boycott of Chinese products, in New Delhi, India, October 26, 2016. REUTERS/Adnan Abidi/File Photo
March 14, 2019
By Krishna N. Das and Neha Dasgupta
NEW DELHI (Reuters) – An Indian traders’ body and the economic wing of an influential Hindu nationalist group called for a boycott of Chinese products on Thursday, after China foiled a bid to blacklist the head of a Pakistan-based militant group that claimed a suicide attack in Indian-controlled Kashmir.
India and the United States said they would continue to push for U.N. Security Council sanctions against Masood Azhar, the founder of militant group Jaish-e-Mohammed (JeM), and many Indians said their patience was running out with China.
The United States, Britain and France asked the Security Council’s Islamic State and al Qaeda sanctions committee to subject JeM founder Masood Azhar to an arms embargo, travel ban and asset freeze. China placed a “technical hold” on the request.
This was the fourth such block on Azhar by China, India’s second-biggest trade partner that said it needed more time to decide. Azhar founded JeM in 2000, and the group claimed a Feb. 14 attack in Kashmir that killed 40 paramilitary police.
The Confederation of All India Traders (CAIT), which represents 70 million traders, said it would burn Chinese goods on March 19 to “teach a lesson” to China.
“The time has come when China should suffer due to its proximity with Pakistan,” CAIT said in a statement. “The CAIT has launched a national campaign to boycott Chinese goods among the trading community of the country, calling the traders not to sell or buy Chinese goods.”
Pakistan has denied any role in the Kashmir attack.
Ashwani Mahajan, a leader of the Swadeshi Jagran Manch that has close ties to Prime Minister Narendra Modi’s ruling Bharatiya Janata Party (BJP), invoked the “Father of the Nation” Mahatma Gandhi to call for Indians to boycott Chinese products.
“Taking a cue from history, best way to defeat China is #BoycottChinese and strong action from govt on trade front,” Mahajan said on Twitter, posting an image of a newspaper ad from 1921 inviting people to burn foreign-made clothes as part of a Gandhi-led protest against British colonial rule.
#BoycottChineseProducts was the second-highest trending hashtag on Twitter on Reuters India on Thursday.
China’s foreign ministry did not immediately respond to a faxed message seeking comment on the boycott calls.
Chinese products – from mobile phones made by companies such as Xiaomi Inc to toys – are ubiquitous in India and trade between the countries touched $89.71 billion in the year ending March 2018. The trade deficit widened to $63.05 billion in China’s favor, more than a nine-fold increase over the past decade.
Indian Finance Minister Arun Jaitley warned against any knee-jerk reaction.
“It’s a diplomatic issue, and India will take a decision after a careful thought,” Jaitley told CNNNEWS18. “We’re not a small player on the global stage, but foreign policy issues are tackled in a measured way, not in a knee-jerk manner.”
A senior government official, who refused to be named citing service rules, said there has been a move to “restrict” Chinese imports but that India was not in a position to replace products such as electronics.
India’s trade ministry said in an email the country can’t take any unilateral punitive action against a fellow WTO member.
But weeks before a general election, India’s main opposition Congress party said Modi’s attempts to improve ties with China were not yielding results.
“Weak Modi is scared of Xi. Not a word comes out of his mouth when China acts against India,” Congress President Rahul Gandhi said on Twitter, referring to Chinese President Xi Jinping.
Modi’s BJP replied: “Be assured that India will win the fight against terror.”
(Reporting by Krishna N. Das and Neha Dasgupta in NEW DELHI; Additional reporting by Aditya Kalra in NEW DELHI and Ben Blanchard in BEIJING; Editing by Nick Macfie)
FILE PHOTO: A man stands next to the logo of Verizon at the Mobile World Congress in Barcelona, Spain, February 26, 2019. REUTERS/Sergio Perez
March 13, 2019
(Reuters) – Verizon Communications Inc said on Wednesday its customers in Chicago and Minneapolis would be able to use its fifth generation wireless network from April 11 by paying $10 per month with any of its unlimited mobile plans.
5G, the next-generation wireless network, is expected to offer data speeds up to 50 or 100 times faster than 4G networks.
Verizon said its customers will need a Motorola Z3 mobile and a device called 5G moto mod to connect to the 5G network.
The largest U.S. wireless carrier by subscribers will offer the device for $50 initially and its customers would not have to pay for 5G use for the first three months.
Verizon launched its first commercial 5G service in October when its 5G Home offering went live in Houston, Indianapolis, Los Angeles and Sacramento.
While Verizon is leading the charge to test its 5G services, industry analysts say the higher-speed networks are unlikely to be widely available until the middle of the next decade.
Rivals AT&T Corp and Sprint Corp are also building their own 5G networks and plan to release 5G smartphones with Samsung Electronics later this year.
(Reporting by Supantha Mukherjee in Bengaluru; Editing by Shailesh Kuber)
FILE PHOTO: Mobile phones are seen on display at an electronics market in Shanghai, China, June 24, 2015. REUTERS/Aly Song
March 13, 2019
By Josh Horwitz
SHANGHAI (Reuters) – Smartphone shipments to China in February fell to their lowest in six years, market data indicated, as consumers continued to put off handset purchases amid a slowing economy.
Shipments to the world’s biggest smartphone market totaled 14.5 million units, down 19.9 percent from a year ago, according to data from the China Academy of Information and Communications Technology, a government-affiliated research institute.
That is the lowest since February 2013, when shipments to the China totaled 20.7 million.
Overall consumer purchases typically slow during February as the Chinese spend much of the month with family celebrating the Lunar New Year. But shipments this year fell more than usual as a slowing economy, exacerbated by a Sino-U.S. trade war, hurt demand for gadgets across the board.
Apple cited slowing iPhone sales in China when it took the rare step of cutting its sales forecast earlier this year. The firm then teamed up with China’s Ant Financial and local banks to offer interest-free iPhone financing in its first such move in the country as it looked to boost waning sales.
Several third-party retailers have also offered iPhones at discounted prices.
With smartphone sales expected to stay weak, companies like Chinese market leader Huawei Technologies have aimed to launch more expensive models to corner higher margins.
In 2018, Huawei’s market share of China’s $500-$800 device segment rose to 26.6 percent from 8.8 percent, according to Counterpoint Research. Apple’s share fell to 54.6 percent from 81.2 percent as it launched devices cracking the $1,000 price point, while others released competitive devices for less.
(Reporting by Josh Horwitz; Editing by Himani Sarkar)
FILE PHOTO: A worker cycles near a factory at the Keihin industrial zone in Kawasaki, Japan February 17, 2016. REUTERS/Toru Hanai
March 12, 2019
By Tetsushi Kajimoto
TOKYO (Reuters) – Big Japanese firms are set to offer smaller pay increases this year at annual wage talks on Wednesday as the economy sputters, tempering hopes that domestic consumption will offset external risks to growth.
Over the past five years, major firms raised wages above 2 percent each spring as Prime Minister Shinzo Abe kept up the pressure on businesses to boost pay in an effort to beat deflation that has dogged Japan for nearly two decades.
But as economic growth slows, firms have become wary about wage hikes because that commits them to higher fixed costs at a time of uncertainty as company profits are leveling off.
“I worry the momentum towards wage hikes may weaken as underlying inflation remains weak and there is a strong sense of uncertainty,” said Hisashi Yamada, senior economist at Japan Research Institute.
“Uncertainty is high on the external outlook such as the U.S.-China trade war and Europe’s unstable politics. On top of that, a national sales tax is scheduled to increase in October.”
A slowdown in the global economy, the Sino-U.S. trade war and trepidation over the final shape of a deal to seal Britain’s exit from the European Union have sharply increased strains on businesses worldwide.
Faced with the heightened uncertainty about the growth outlook, cautious Japanese firms usually prefer to offer one-off bonuses and other benefits depending on annual profits.
They tend to focus more on the annual total sum payment than fixed base salaries, which will determine retirement payment and pension benefits.
Results of the “shunto” talks between management and unions – announced by blue chips in industries like cars and electronics – set the tone for wage hikes across the nation, which will affect strength of consumer spending and inflation.
A Reuters Corporate Survey last month found a slim majority – 51 percent of firms polled – saw wages rising around 1.5-2 percent this year, versus last year’s 2.26 percent average across all Japanese industries.
Some analysts expect wage growth to slow further from the 17-year peak of 2.38 seen in 2015 to around 2.15 percent this year, despite hefty cash piles at Japanese corporations.
The bulk of wage hikes – about 1.8 percent – comes automatically under Japan’s seniority-based employment system. Anything beyond that is a hike in “base pay.”
This year, bellwether Toyota Motor Corp is set to refrain from announcing a specific base pay hike, ditching its role as trend-setter in a sign of growing pressure on businesses.
PAY HIKE OR WORK-STYLE REFORM
In the coming fiscal year from April 1, Abe’s government will start to implement work-style reform to curb Japan’s notoriously long work hours.
The reform also includes “equal pay for equal work” aimed at narrowing the pay gap between full-time employees and contract workers or part-timers, and raising the retirement age to cope with the aging population.
The move has shifted focus away from pay hikes with both unions and management, dashing policymakers’ hopes of stoking a virtuous cycle of a tight job market boosting wages to stimulate consumption and spur inflation to the BOJ’s 2 percent target.
Japan’s unions tend not to be so aggressive in pressing their demands as those in the West because they attach greater importance to job security and retain a sense of company loyalty.
The dwindling union membership has deprived unionists of bargaining powers, with companies hiring more non-unionised part-timers and nonregular employees, who represent nearly 40 percent of workers.
“At this year’s shunto, both companies and unions don’t seem to put greater emphasis on wage hikes than before,” said Kiichi Murashima, economist at Citigroup Global Markets Japan.
“Instead, they are considering a wider range of issues like pay disparity, labor productivity and work-life balance.”
(Reporting by Tetsushi Kajimoto; additional reporting by Izumi Nakagawa; Editing by Shri Navaratnam)
Demonstrators shout slogans as they participate in a march demanding jobs and better education facilities, in New Delhi, India February 7, 2019. REUTERS/Anushree Fadnavis
March 12, 2019
By Zeba Siddiqui
CHINCHWAD, India (Reuters) – Santosh Gurav gained a bachelor’s degree in technology from a mid-tier college in western India last year, specializing in electrical engineering and hoping to land a job in industrial automation.
Six months on, the 27-year-old repairs mixer-grinders, table fans and other household appliances at a cramped shop in the western city of Pune. On better days, he picks up broken LED lights from scrap dealers, fixes them, then sells them. He earns about $50 a month, just enough to cover the rent for the room he shares with two others as his home.
“I haven’t even started repaying my education loan,” said Gurav, referring to the nearly $4,000 he’d borrowed for his undergraduate study.
He is one of hundreds of thousands of engineers – studying everything from computer code to civil engineering – that India’s education system churns out each year, many with large loans and little prospect of finding a job in their field.
They highlight Prime Minister Narendra Modi’s difficulty in fulfilling a promise he made weeks after coming to power in 2014: creating millions of jobs by boosting manufacturing under a flagship ‘Make in India’ project launched with much fanfare.
“Come, Make in India, we will say to the world, from electrical to electronics,” Modi said in his maiden Independence Day speech as prime minister, pledging to create up to 100 million new jobs by 2022.
NO ECHOES OF CHINA BOOM
Four years on, the program’s impact on job creation is unclear and growth in the manufacturing sector has been sluggish, partly due to a lack of land and labor reform.
India’s unemployment rate rose to 7.2 percent last month, up from 5.9 percent in February 2018, according to data compiled by the Centre for Monitoring Indian Economy (CMIE) think tank. The figures are more recent than government data and many economists regard them as more credible.
The data, which is an estimate based on household surveys, shows 31.2 million people were actively looking for jobs in February this year, said Mahesh Vyas, the CMIE managing director. It did not have a breakup for engineering or technology graduates.
With more than half of India’s population under 25 years of age, critics say the votes of jobless youth could hurt Modi’s chances of securing a second term in the upcoming general election to be held in April-May.
The increasing use of automation in industry, the massive number of young Indians coming onto the job market, and the regulatory hurdles that companies still face if they want to set up shop in India, are all big issues for those without work.
The manufacturing boom that helped China in the past 40 years will not wash up on India’s shores. Companies can no longer afford to just rely on cheap labor: they need skilled labor and better infrastructure to drive technological innovations and increase productivity.
Employers often complain about the lack of skilled engineering and technology graduates, said Varun Aggarwal, an electrical engineer and co-founder of the skills assessment firm Aspiring Minds. Its surveys show over 80 percent of the engineers India produces are not employable. The employability has not improved in seven years, Aggarwal said.
“The numbers have just not budged,” he said. “Many can’t even write basic code.”
“We need to start there, at the beginning of the education system,” said Aggarwal.
The IT industry had long been seen as a gateway to the middle class in India, but a move to robotics and artificial intelligence has replaced some positions. The business process outsourcing industry – seen as a stable provider of “offshore” jobs – added the least number of employees in seven years in 2017-18 (April-March), according to the trade body Nasscom.
LACK ENGLISH SKILLS
At a recent job fair organized by a college in the town of Chinchwad in western India, Gurav was among hundreds queued up to apply, including dozens of engineers, even though most companies were hiring for marketing and finance positions.
Many came from rural areas where they studied in regional languages, and lacked strong English skills – another gap that recruiters say India’s education system needs to address.
Ankush Karwade, 22, who traveled 80 miles (130 km) to reach the fair, said his father was a farmer and the family couldn’t fund him to earn an undergraduate degree. He did a shorter and cheaper diploma course in engineering.
“I watch some English movies and read the newspapers to improve, but most employers want graduates,” he said. “They (also) want English speaking skills, which I don’t have.”
Gayatri, a 24-year-old woman who goes by one name, gained a master’s degree in engineering four months ago, under pressure from her parents. She said she had wanted to continue her education in Indian classical music.
“My father wanted me to do engineering, so I did it. Now there are no jobs,” she said. A company at the fair offered her a customer service position that would pay about $140 a month.
“Can you believe it?” she said. “I didn’t get this degree to sit at a call center.”
Jobless engineers are not a new problem and “miniscule” in comparison to the millions of farmers dissatisfied over weak crop prices, said Himanshu, an associate professor of economics at the Jawaharlal Nehru University who also uses one name.
Still, they represent a lot of untapped potential.
Fixing household appliances is not what Gurav expected to do as a graduate. “I could find work at a call center, but it’s not what I want to do,” he said. He may soon be forced to reconsider though as his father is due to retire next year and the family will need the money.
For now, Gurav plans to continue to do the repairwork – but is too ashamed to tell his friends about it, he said, and refused to be photographed at the shop.
“If people see me working there they might think I’m unskilled. But I have skills. I am passionate about this field.”
(Reporting by Zeba Siddiqui in CHINCHWAD; Additional reporting by Aftab Ahmed; Editing by Martin Howell and Raju Gopalakrishnan)