The Japanese economy continues to flounder in the midst of a serious recession. The unemployment rate has been rising at record rates-in July, the overall jobless rate rose to 4.3 percent, which exceeds the rate in the United States. There are daily newspaper reports about the severe situation job hunters face.

However, engineers continue to do well. "Engineers, especially software engineers, are in great demand. To cope with digitalization and networking, companies need more engineers," said Ichiro Katagiri, consultant at Watson Wyatt K.K., a Tokyo office of Watson Wyatt Worldwide, an international management-consulting company.

Large-scale companies hire most of their employees in April from new university graduates. This is called "regular" employment. While the overall number of workers hired as regular employees is on the decline, the number of graduates being hired fresh from science and engineering courses is increasing, despite the bleak economic outlook. Many companies think that if they decrease the number of new engineers they hire this year, their R&D capability will be undercut in the future.

One reason the engineers are faring well is that the consumer-electronics business is moving to digitalization.

The supply of "software engineers, not only for computers but also for consumer electronics and telecommunications, is tight," said Katagiri. "Other industries, even the automobile industry, have lost hiring momentum. The electronics industry is now the only bright spot where these engineers are being hired."

AVC Co. of Matsushita Electric Industrial Co. Ltd., whichspecializes in consumer electronics-including personal computers-plans to double the number of engineers by 2000.

Matsushita expects that R&D work in the area of digital electronics will increase fourfold. "We are going to cope with the increased need for R&D by doubling both the number of engineers and our productivity," said a Matsushita spokesman. Matsushita plans to gear up for the work force it needs by transferring engineers internally and outsourcing a part of R&D.

Sanyo Electric Co. Ltd. also plans to double the number of engineers to about 3,000. "Total employment is decreasing. However, the employment of engineers is increasing," said a Sanyo spokesman. "We are actively hiring engineers to train them for R&D in digital consumer electronics."

Lifetime employment has been a mainstay of Japan's hiring practices. But companies are now reviewing the system. So are some employees.

"Among the middle- and small-scale companies, people have been changing jobs for some time. Now employees of large-scale companies have started moving around-especially younger workers below the age of 30, who are encouraged by job opportunities outside," said Katagiri.

Companies also are offering different employment options. In January, Sony Corp. began to offer five-year job positions.

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