Corporate Restructuring: Converging World Pattern or Societally Specific Embeddedness?

Abstract

Recently the term “corporate restructuring” has been used to signify a series of strategies to relieve corporate cost burdens. In the American context, corporate restructuring has been synonymous with widespread layoffs and worker terminations as a prevailing strategy. Japanese and German firms, in contrast, use alternative employment adjustment measures with worker termination used as a last resort. Close examination indicates Japanese corporations exhibit organizing principles based on an elaborate sequence of employment adjustment responses to prolonged recession. Further, this article identifies the institutional relations that permit Japanese firms to resist terminating regular employees as a response to recession. Finally, we contend that societal accounting conventions mediate these institutional configurations and employment adjustments to economic recession. These Japanese organizing principles are not universal but represent a societal accounting scheme sustained by overlapping and crosscutting corporate, government, and social institutions.