For example, a craftsman earning 15,000 yen per day would earn 15,000 yen \u00d7 22 days = 330,000 yen if he worked 22 days, and 270,000 yen if he worked 18 days.<\/p>\n
Even if the same person works with the same skill level, their monthly earnings can vary by 60,000 yen depending on the weather and the work process.<\/p>\n
For a company that pays a monthly salary of 330,000 yen under a daily-to-monthly pay system, the amount corresponding to the number of days absent will be deducted according to the calculation method specified in the employment rules.<\/p>\n
Under a fixed monthly salary system, as a general rule, basic pay is not reduced due to absences.<\/p>\n
A common misconception here is the idea that because you\u2019re on a fixed monthly salary, you don\u2019t get paid for overtime, or that because you\u2019re on a daily wage, you don\u2019t get paid time off.<\/p>\n
Neither is correct.<\/p>\n
Both overtime pay and paid vacation are governed by the Labor Standards Act, regardless of how wages are paid.<\/p>\n
The Pitfalls of the Term \u201cDaily and Monthly Wages\u201d<\/h3>\n
In the construction industry, some companies use the term \u201cdaily wage\/monthly salary\u201d to mean \u201cdaily wage multiplied by the number of workdays, paid in a lump sum at the end of the month.\u201d<\/p>\n
Actually, this is just a daily wage system, isn't it?<\/p>\n
Even if a job posting says \u201cdaily or monthly wage,\u201d you won\u2019t know which one it means unless you ask how it\u2019s actually calculated.<\/p>\n
Whether you're hiring a craftsman or applying for a job, it's better to verify the information based on the calculation method rather than just the name.<\/p>\n
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Pros and Cons of the Daily Wage System and Turnover Rates Among Skilled Workers<\/h2>\nBenefits for Artisans<\/h3>\n
The best thing about a daily wage system is that the amount you earn directly reflects the hours you work.<\/p>\n
Since the daily wage rate is clearly defined, it's easy to see what my skills are worth.<\/p>\n
Even when comparing with other companies, you can instantly see the difference: \u201cWe charge 18,000 yen, while they charge 20,000 yen.\u201d<\/p>\n
I think the more skilled a craftsman is, the more he tends to prefer this kind of clarity.<\/p>\n
However, just because it\u2019s a daily wage system doesn\u2019t mean you can take days off whenever you want.<\/p>\n
Workdays and days off are determined by the employment contract and work rules, even under a daily wage system.<\/p>\n
The downside for craftsmen is the rain.<\/h3>\n
The biggest problem is that you lose income on days when you want to work but can't.<\/p>\n
There are also on-site factors such as rain, snow, strong winds, delays in previous stages of the process, and waiting for materials to arrive.<\/p>\n
On slope construction sites, it\u2019s not uncommon for work involving sprayed mortar and other mortar applications to be halted due to rain. (On large sites, this may mean postponing the assembly of the slope formwork.)<\/p>\n
If you earn 15,000 yen a day and miss four days a month, that alone will reduce your income by 60,000 yen.<\/p>\n
But rent, car payments, and my kids' school lunch fees\u2014none of those go down just because it's raining, lol.<\/p>\n
As a result, there are craftsmen who push themselves to come to work even when they're not feeling well.<\/p>\n
This is what scares me the most.<\/p>\n
According to the Ministry of Land, Infrastructure, Transport and Tourism report mentioned earlier, about 30 percent of skilled workers who worked on construction projects following the two-day-off-per-week model reported that their income had decreased, citing the reduction in the number of working days as the reason.<\/p>\n
If the number of days off increases, craftsmen paid by the day will see their income decrease.<\/p>\n
When discussing a two-day weekend, we can\u2019t move forward without addressing this point.<\/p>\n
Furthermore, if an employer suspends operations at the company\u2019s discretion, the employer is obligated under the Labor Standards Act to pay a suspension allowance equal to at least 60 percent of the employee\u2019s average wages.<\/p>\n
However, I can't say for sure whether a cancellation due to rain qualifies as a \"day off due to the company's responsibility\"...<\/p>\n
If you're curious, check with the Labor Standards Inspection Office or a social insurance and labor consultant lol (I guess there's a clear answer!!?)<\/p>\n
Advantages and Disadvantages for the Company<\/h3>\n
The benefit for the company is that labor costs are less likely to rise during periods when there is little work.<\/p>\n
Work tends to pile up at the end of the fiscal year, so I\u2019ll probably have some free time as early as March through June...<\/p>\n
For companies that primarily focus on public works projects, there is a sense that they have been able to absorb this trend through a daily wage system.<\/p>\n
But there's a heavy price to pay in return.<\/p>\n
If there's a company that pays 2,000 yen more per day, the workers will go there.<\/p>\n
Since my company doesn't provide me with financial stability, I have no reason to stay.<\/p>\n
There's a chance that a craftsman we've spent three years training to be fully competent might leave to work at another site...<\/p>\n
Data Showing Differences in Turnover Rates by Payment Method<\/h3>\n
While this data does not cover all skilled workers in the construction industry, there are some figures that may be helpful.<\/p>\n
According to the Reiwa 5 Fiscal Year Study Group on Construction Carpenters and Related Trades\u2019 report titled \u201cFostering Local Construction Companies and Securing and Training the Next Generation of Construction Carpenters,\u201d a survey of businesses that employ carpenters revealed that the turnover rate for the Reiwa 5 fiscal year was 57% for those on a daily-wage, monthly-pay system and 39% for those on a monthly-salary system.<\/p>\n
An 18% difference.<\/p>\n
Since this is a survey for carpenters, I'm not sure if it applies directly to slope-work or civil engineering professionals, but,<\/p>\n
Still, the fact that the data shows differences in retention rates based on payment methods is something we, as a construction company, cannot ignore....<\/p>\n
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Reasons Why Skilled Workers Don't Stay and How Construction Sites Used to Operate<\/h2>\nThe workers who stopped coming once they got paid<\/h3>\n
This happened a while back.<\/p>\n
It doesn't happen much these days, but back in the day, there were tons of workers who would stop showing up the moment they got paid lol.<\/p>\n
When I get paid, I go out for drinks.<\/p>\n
If I win at pachinko, I take a break; if I lose, I take a break too lol<\/p>\n
If he gets scolded by his boss, he gets angry and doesn't show up the next day.<\/p>\n
He didn't show up this morning because he drank too much and couldn't get up.<\/p>\n
At the sites I\u2019ve visited, scenes like that were a common occurrence.<\/p>\n
Of course, not everyone.<\/p>\n
There were also many craftsmen who arrived earlier than anyone else every morning and quietly went about their preparations.<\/p>\n
So, what about now?<\/p>\n
Sometimes I think, \u201cIsn\u2019t it just that alcohol has been replaced by energy drinks\u2014I can\u2019t sleep at night and can\u2019t wake up in the morning\u2014and pachinko has been replaced by in-app purchases in mobile games?\u201d lol<\/p>\n
It's not that enjoying games is a bad thing; the problem is that in today's world, where there are so many ways to have immediate fun or kill time, gaming is often prioritized to the point where it disrupts work and daily life.<\/p>\n
This happens not only to craftsmen, but also to supervisors and managers.<\/p>\n
However, on the job site, if even one person suddenly calls in sick, the team can\u2019t function properly, which puts an undue burden on the remaining workers and compromises safety.<\/p>\n
That's why I think it's so noticeable when a craftsman is absent.<\/p>\n
Do artisans really prefer freedom?<\/h3>\n
I believe one of the reasons the daily wage system has persisted is the craftsmen\u2019s sense of independence.<\/p>\n
If you gain the necessary qualifications and experience, your skills will become your selling point.<\/p>\n
I trust my own skills more than the company's reputation.<\/p>\n
On the other hand, the supervisor manages the schedule, costs, safety, quality, and paperwork, working within the context of long-standing relationships with the company and the client.<\/p>\n
It's a position where it's easy to choose stability within an organization.<\/p>\n
However, it\u2019s a bit of a stretch to attribute this difference to intelligence. (Though there might be some truth to it...)<\/p>\n
There are countless craftsmen who make judgments not found in textbooks based on the sound of the drilling machine, the load on the machine, and the condition of the material.<\/p>\n
An excellent foreman keeps an eye on everything\u2014from planning and costs to interpersonal relationships.<\/p>\n
A skilled craftsman and a good foreman aren't necessarily the same person because they're called upon to make different kinds of decisions.<\/p>\n
Financial anxiety impairs judgment<\/h3>\n
When life gets tough, people tend to be preoccupied with the bills they have to pay right away.<\/p>\n
A meta-analysis (a method of synthesizing and analyzing the results of multiple studies) published in the *Journal of Economic Psychology* in 2024, which examined 29 datasets and more than 110,000 participants,<\/p>\n
We investigated the relationship between economic deprivation and cognitive performance, and the results showed that economic deprivation is associated with lower cognitive performance.<\/p>\n
However, much of this relationship can be explained by educational attainment; when educational attainment is taken into account, the effect is estimated to be about 60 percent smaller, with the remainder attributed to a minor effect.<\/p>\n
In other words, this isn't to say that \"poor people are stupid.\"<\/p>\n
The point is that worrying about money takes away some of the mental space we need to think.<\/p>\n
In a rush to pay off debts, they take out one high-interest loan after another.<\/p>\n
They hop from job to job, focusing only on the daily pay.<\/p>\n
The point is that it\u2019s far more beneficial for the company to alleviate craftsmen\u2019s financial anxieties than to make assumptions about their character.<\/p>\n
So, if you have some extra money, it's hard to quit, isn't it?<\/p>\n
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Why Raising Wages Doesn't Solve the Labor Shortage and the Future of Wage Systems<\/h2>\nA high daily wage and annual income are two different things<\/h3>\n
It's necessary to raise salaries.<\/p>\n
But that alone isn't enough to keep people around.<\/p>\n
For example, suppose there are two companies: one that pays a daily wage of 18,000 yen and another that pays a monthly salary of 330,000 yen.<\/p>\n
If you work 22 days at a daily wage of 18,000 yen, you'll earn 396,000 yen.<\/p>\n
At first glance, the daily wage seems like a much better deal, doesn't it?<\/p>\n
But if you work 190 days a year, that\u2019s 18,000 yen \u00d7 190 days = 3,420,000 yen.<\/p>\n
With a monthly salary of 330,000 yen, even without a bonus, that comes to 330,000 yen \u00d7 12 months = 3,960,000 yen.<\/p>\n
Companies that offer higher daily wages actually end up paying 540,000 yen less in annual salary.<\/p>\n
Furthermore, actual compensation varies significantly depending on annual holidays, paid time off, bonuses, social insurance, retirement benefits, and overtime pay.<\/p>\n
I feel like the construction industry has been focused solely on competing over daily wage rates.<\/p>\n
It might be that, going forward, job postings won\u2019t be chosen unless they clearly show how much you can earn annually, how many days off you\u2019ll get, and how many years you can work.<\/p>\n
The same goes for the director.<\/p>\n
Even with a stable monthly salary, young people are quitting due to long working hours, mountains of paperwork, and an overwhelming concentration of responsibility.<\/p>\n
Wage Systems in the Construction Industry Abroad<\/h3>\n
It seems that the system of working for a daily or hourly wage isn't unique to Japan. (According to AI research)<\/p>\n
In the United States, the Bureau of Labor Statistics (BLS) compiles data on wages for construction workers as \"average hourly wages.\"<\/p>\n
In the United Kingdom, there is the \u201cConstruction Industry Scheme (CIS),\u201d under which general contractors in the construction industry withhold taxes from payments to subcontractors and remit them to the tax authorities (HMRC); this system is designed for tradespeople who work as self-employed contractors rather than under employment contracts.<\/p>\n
In Germany, there is a \"seasonal short-time work allowance (Saison-Kurzarbeitergeld)\" designed to address the decline in work during the winter months in the construction industry.<\/p>\n
According to an explanation from the German Pension Insurance, this benefit is provided to prevent winter unemployment and covers periods when work is unavoidably suspended due to weather conditions or other factors during the period from December 1 to March 31.<\/p>\n
The target industries include general construction, roofing, landscaping, and scaffolding.<\/p>\n
There are systems in other countries as well where income varies depending on the weather or the amount of work.<\/p>\n
The difference lies in who will provide financial support during the period when income decreases.<\/p>\n
Should the company pay, should the individual cover the cost, or should it be supported by a public system?<\/p>\n
Hasn't the Japanese construction industry largely shifted the burden onto the craftsmen themselves? Haven't the companies been taking advantage of the craftsmen?<\/p>\n
<\/p>\n
Continued in Part 2<\/p>\n
<\/p>\n
See you later.<\/p>\n
Tips for Getting a Raise | Pay Raises in the Construction Industry<\/a><\/p><\/blockquote>\n