Young workers have in recent years favored carefree lifestyles, hopping from one part-time job to another, or quitting full-time jobs after just a few years, Tsuiki said.

Analysts have said the trend bodes ill for Japan's labor market in the long term because it would lead to a shortage of skilled workers.

Retaining older staff has also been a challenge for companies trying to avert a labor crunch.

Older workers were switching jobs because they failed to get along with colleagues or were unhappy with how they were being evaluated at companies using performance-based management, the white paper said.

Under Japan's traditional lifetime employment system, employees were guaranteed promotions and pay increases as they grew older, regardless of performance.

"For an effective performance-based system, efforts are needed to improve the implementation of the wage system, such as making clear the basis for evaluation and providing detailed explanations for the assessments," the white paper said.

(China Daily via agencies July 23, 2008)