32 Years of Service End in Demotion: Manager's Salary Slashed 40% in Japan

A 54-year-old manager in Japan, who had dedicated 32 years to a building materials company, faced a drastic career setback after a change in leadership. His annual salary was slashed by 3.4 million yen (approximately $680,000 TWD), impacting his retirement plans and mortgage. This incident serves as a stark reminder that in the era of AI and digitalization, long-term tenure alone does not guarantee job security.

Previously, the manager, Hiroshi Kobayashi, was trusted by the company's founder and rose to the position of sales manager, earning an annual salary of 8.6 million yen (approximately $1.72 million TWD). He was confident about his retirement, with an estimated pension exceeding 15 million yen (approximately $3 million TWD), and felt secure about his mortgage, children's education, and future retirement life.

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If only the founder were still here...

However, following the founder's death, his brother took over and initiated sweeping reforms, emphasizing ability and performance over seniority. Kobayashi was subsequently informed of his demotion to a general employee, with his annual salary dropping to an estimated 5.2 million yen. The reduction meant a loss of 3.4 million yen annually, with his future pension and social security benefits also set to shrink.

Reflecting on his situation, Kobayashi acknowledged his own shortcomings. He realized that his complacency and failure to learn new skills over the years, relying solely on his 32 years of experience, had left him vulnerable. This demotion and salary cut became a painful lesson, underscoring the need for continuous professional development and adaptation in a rapidly evolving job market.

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I also made a big mistake by not continuously honing my abilities.