The total unemployment rate was 5.4% in 2002, the highest ever recorded. Within that figure the unemployment rate for young people (aged 15~24) was 12.1%, three times the 4.3% rate of 1991. Statistics show there are 2 million floating casual workers, known as furi-ta-, who have not entered fixed employment. Whilst policies on this youth employment instability are already in place in the countries of Europe and America, we should have been planning our policies from 10 year ago when Japan entered economic recession after the Cold War. The unemployment of youth differs from the unemployment problems of the middle-aged or elderly. It is not just a question of the setting up of young people for life, but an important matter for the state, the cultivation of the human resources that will shoulder Japan's future. The fundamental perspective on formulating and implementing these polices is that state regulation should stop with putting the conditions in place for security of employment. In light of the fact that the choice of what kind of life a young person builds is a right based on the freedom of occupation in Articles 22(1) and 27(1) of the Constitution, the provision of services to the unemployed and job-seekers is something which should be carried out independently, by private enterprise. To use a catchphrase, "whatever can be privatized, should be". Even an unemployed person is a healthy and sovereign individual who holds the right to vote. This is why the governments (national and local governments) meddle excessively and overspend their budgets on the unemployed. We must avoid switching from one kind of administrative failure to another, from public investment in white-elephant infrastructure projects to public investment in 'software'. The aim of achieving small government at national and local levels has not changed. When pursuing that aim we should be instructed by the legal and schooling systems precedents set by early efforts to grapple with youth unemployment in England, France, Germany and America. Schooling in these countries is primarily vocational with an undercurrent of Protestant tenets such as "members of society make their contribution to society through their occupation" and "the person who succeeds at work succeeds as a human being"

Methods for using the vitality of the private sector in relation to services include PFI and PPP, the issue here being the division of roles between the private sector and the national or local government. We need to first consider the youth employment policies of Europe and America, introduce practical learning and occupational training into Japan's current school education and further, to set up a system for training young unemployed persons for suitable occupations in stages. I have listed concrete proposals on (1) reform of school education programs and providers, (2) internships, and (3) one-stop job finding services below.

(1) Reform of school education programs and providers The content of compulsory elementary and middle school textbooks, textbooks for mainstream, technical and commercial high schools and university textbooks will be altered to make it appropriate for society's needs. Further, education provided by joint-stock companies would be introduced into the current education system, which is limited to incorporated educational institutions (18% of American universities are run by joint-stock companies).

1. Reform of school education programs The introduction of education in job finding is needed for schools to prevent students becoming floating casual workers or jobless after graduation *1. The attached diagram "Overall Scheme of Youth Employment Policies" illustrates this model. Young people have undeveloped careers, in addition to which, in Japan's case, their finding work is made all the more difficult by the fact that there is no occupational orientation or awareness in relation to job finding taught at schools. The obvious countermeasure is the thorough teaching, consistently throughout schooling, of occupational orientation, occupational ethics, job finding awareness and the meaning of work, through a job finding education program.
   
   In concrete terms,

   1. Job finding awareness would be inculcated from the compulsory levels of education (elementary and middle schooling), teaching matters including the fundamentals of the economic structure and practical business law, either through improving the Social Studies curriculum or the creation of a new subject. Obviously no pains would be spared in subjects like reading, writing and arithmetic. Textbooks for the teaching of Japanese would not be wholly literature; material able to cultivate skills in the composition of legal and philosophical Japanese would be increased. Legal sentences are the best for cultivating logical thought in Japanese;

   2. Occupational ethics and occupational orientation would be taught at high school, obviously in commercial and technical high schools but also even in mainstream high schools. Bookkeeping, accounting, management, marketing, technology, digital engineering and other elements of practical learning would be introduced into commercial and technical high schools, with a dual system to be introduced in future *2.

   3. Universities and graduate schools would be divided into research and educational models. Research universities would aim to be the best in the world and specialize in the unearthing of genius and outstanding talent and R&D, whereas educational universities would provide elite specialist education for entering specialist business occupations (see later). Collaboration between industry and universities would be actively promoted in relation to instruction and courses and an internship system *3 should be introduced. Resistance to commercialization is circulating in the academic world, however this ignores current global markets and will result in the protection of vested interests. Problems related to commercialization can be resolved by a system of ex post facto assessment.

2. The introduction of U.S.-style practical business education: from government-controlled to consumer-led In order to respond rapidly to issues such as the deflationary economy, structural reform, financial regulation and the opening up of government controlled markets we should plainly open up business education carried out by universities and graduate schools run by joint-stock companies, from the current Special Zones method (through applications to local governments) to a situation where private enterprise can decide to set up educational businesses at their own discretion anywhere in Japan (refer to materials in relation to curricula). The role universities fulfill must change in response to the requirements of society and expectations of the community of the time. The definition of a university is not a priori a matter to be officially determined, it is fundamentally a matter determined by the community, in other words by business and society that absorb current students and graduates as practical resources, by the needs of consumers. Even educational services have changed to being consumer-oriented and user-led. What business and society is newly seeking from universities is the cultivation of practical business skills. In concrete terms, this is the training up of capable human resources who have high-level practical business skills as specialists (in the professions, research occupations and the like) or as general duties workers, so that they can play an active part as fully-fledged participants in the general capitalist economy of international society. At present most university students pay their own way to attend non-university practical business training institutions run by joint-stock companies to learn specialist knowledge required in actual society; to pass the National Bar Examination or to become a CPA, registered small enterprise consultant, social insurance and labor agent or similar. A 'dual system' is in fact already in place. Business, fully-fledged members of society and students alike recognize that current university lectures alone are insufficient for them to make a living in the adult world after graduation. For some time past Keidanren (the Federation of Economic Organizations of Japan) has been supporting the opening of a business school at Hosei University in order to cultivate business skills. Of course, the emphasis laid on this kind of practically-oriented-education-model university does not mean a decline in the status of scientific-research-model universities. The role of those universities would be further heightened as they aim to be the best in the world.

(2) Internships Internships are an effective job finding method for young people as they can verify their personal aptitudes and occupational orientation and acquire practical business skills during the course of their studies. We need to enact an Internship Law (provisional name) and introduce an obligatory national internships system for businesses, an outline of which follows:

1. Businesses pay an appropriate allowance to job seekers even during the term of the internship;

2. At the same time as the implementations of internships and the like is made obligatory for businesses, the state subsidizes the whole or a part of the appropriate allowance, since the practical training and guidance of job seekers would be a significant burden on businesses;

3. Businesses are unable to dismiss job seekers during the term of the internship and the interns are also unable to quit for the same period. Where interns do leave the workplace due to having quit or for similar reasons penalties including becoming ineligible to receive the appropriate allowance are, of course, applied;

4. METI (the Ministry of the Economy, Trade and Industry) prepares a database of businesses accepting interns and provides that information, not only to "Hello Work" but broadly and in general. Progress is being made in introducing the dual system that has a long tradition in Germany. However in order to make it effective, concrete curricula and licensing examinations must be developed for each occupation and be maintained in step with technological innovations. It follows that for the time being, introduction into Japan must begin with relatively simple occupations and results such as in Germany should not be expected *4.

1. The Youth Independence Challenge Plan Four ministries, METI, MHLW (the Ministry of Health, Labor and Welfare), MEXT (the Ministry of Education, Culture, Sports, Science and Technology) and the Cabinet Office took joint action on a "Youth Independence Challenge Plan" ("the Plan") *5 on 10 June this year and a concrete draft of the project with a rough estimate of the cost finally made available on 29 August. METI's initial proposal in accordance with the overarching structural reform principle of "privatizing whatever can be privatized" was an exceedingly fitting policy within the bounds allowed by laws currently in force (such as the Employment Security Law). One-stop service centers should become ground-breaking bodies that shoulder the important functions of providing occupational training and re-training opportunities in keeping with personal aptitudes, not only to unemployed persons covered by employment insurance but also to the jobless who fall outside that insurance coverage and to floating casual workers. As is recorded in the materials, I propose that a "Comprehensive Employment Measures Promotion Section" (provisional name) be set up in the Cabinet Office. I consider that such a section would be ideally placed to be able to take the initiative in relation to METI, MHLW and MEXT in accordance with the fundamental principles of structural reform, introducing private sector vitality and recognizing the autonomy of local governments to implement bold regulatory reforms
2. The effectiveness of Job Cafes will come firstly from reform of the Employment Security Law Regulatory reforms carried out by a Comprehensive Employment Measures Promotion Section should first begin with reform of the Employment Security Law. Article 32-3 of the Employment Security Law and Article 20 of the Enforcement Regulations for the same, which prohibit the obtaining of a service fee for "job introductions" (the mainstay of one-stop job finding services) from "job seekers", should be repealed immediately. No such regulations exist in any state in America. It is particularly difficult for middle-aged and elderly unemployed persons to find work in a workplace that capitalizes on their former careers without the close support of private sector job introduction agents. It is very strange that it should be prohibited to task another person to look for a job that suits one's own desires and to bear the price of that service oneself. It simply means one's range of choice becomes broader. Pre-war societal conditions no longer exist in any form. Those unemployed persons who do not wish to pay for these services themselves can use the free services provided by "Hello Work". At present when a private agent matches an unemployed person pursuant to their request with a desirable hiring employer, the agent cannot invoice the unemployed person for the cost of those services. The prohibition in the Employment Security Law means that business (whether the business from whence the unemployed person originates or the hiring employer) or the national or local governments are paying for that service through taxes. This is unprecedented irrationality, particularly in relation to young persons who have not been paying into employment insurance. The current Plan proposes covering expenses by subsidies and other taxes, however the one who receives the considerable benefit of the provision of occupational training and other services, finds a job and gains a foundation for life is none other than the job seeker themselves. It follows in my view that the beneficiary of "one-stop job finding services" is the one who should bear the cost of the same.

*1 Jobless persons are defined as persons assisting with housework, persons remaining at school as research students, persons enrolled at various schools including technical schools, foreign schools and occupational skill development facilities and persons who, have graduated but have not found a job and who are clearly not persons who will go on to postgraduate education. According to MEXT, as of March 2002 there were 119,000 university graduates, 25,000 junior college graduates and 138,000 high school graduates who were jobless. Of university graduates, 21.7% were jobless, the second highest rate ever, and of high school graduates 10.5% were jobless, the highest rate ever.

*2 The dual system is one of the educational systems used in Germany whereby most of those who complete compulsory education then choose vocational education through the dual system. Students receive vocational training pursuant to agreements with business for 3~4 days a week and attend school for 1~2 days a week. As the students have two identities, being apprenticed to businesses whilst being enrolled at school at the same time and their education is carried out at two locations, at a business and at school, this is called a 'dual system' and those who complete the training can obtain occupational qualifications. Refer p.118 of Nakano Ikuo, (2002) Straying Off Course between School and Work [Gakko kara shokgyo e no meiso]. Senshu University Publications Department.

*3 Internships are defined by MEXT, MHLW and METI as "the system whereby a student undertakes work experience related to the student's own specialization or future career during the course of their studies". The content of the same will vary according to the provider of the work experience (whether business, an economic organization or educational institution) but all cases share the common theme of "providing an opportunity for the student to join society". For students, internships have the benefits of clarifying personal vocational aptitudes and career plans and improving skills. On the other hand, for business, internships have the benefits of doing away with hiring mismatches and constituting good public relations. It has been recognized in America, the heartland of the internship, that internships also assist in revitalizing industry and over 85% of the roughly 1,500 four-year colleges across the country have introduced internships into their curricula. Further, over 80% of U.S. businesses use internships in one form or another. Numerous guides to internships such as the Internship Bible and America's Top Internships are on sale at bookstores. Note that there is no job mediation system associated with graduation in the States. Students work part-time whilst studying and also change jobs frequently after graduation in order to find the occupation best suited to them. However the high youth unemployment rate in the U.S. has become a problem and a Federal law, the School-to-Work Opportunities Act was passed in 1994 on the conceptual basis that "school education is the foundation of the formation of the labor force and that results at school have a major impact on the employability of an individual in the labor market". See p.79 ff of Nakano, cited above.

*4 The MHLW made an announcement on 11 September 2003 on a dual system for Japan entitled "Drastic easing of eligibility requirements for technical licensing examinations and broad expansion of licensed technical occupations for young persons". According to the announcement, technical occupations will be progressively opened up from fiscal 2004, beginning with construction carpentry (carpentry building work) and electrical appliance assembly (switchboard and control board assembly work) and followed by machine safety (electrical safety work), other electrical appliance assembly (sequence control work), machine and plant drafting and similar. Further, for white-collar workers, there are plans to utilize and promote the use of existing business and career systems.

*5 The Youth Independence Challenge Plan is a comprehensive policy on youth employment where industry, academia and government joint together to tackle the cultivation of human resources and the creation of job opportunities. In concrete terms it is comprised of four perspectives: (1) support for career building and job finding from the school stage to arrival at the workplace; (2) the improvement of the labor market for young people; (3) the improvement of the skills of young people and the expansion of their job finding choices (4) the creations of opportunities for young people to start work. The establishment of "one-stop service centers", known as "Job Cafes" is to be promoted in regional areas, as the provision of a new mechanism for young people where they can receive the provision of information, work experience, individual counseling and job finding support at one location.