Guest Post: The Hidden Cost Of The "New Economy": New-Type Depression

Tyler Durden's picture

Submitted by Charles Hugh Smith from Of Two Minds

The Hidden Cost Of The "New Economy": New-Type Depression 

Two decades of economic stagnation and rising insecurity have unleashed work-based "new-type depression" in Japan.

Today I continue to explore the theme that Japan's two decades of economic stagnation may offer guidelines for what lies ahead "for the rest of us" as the global malaise deepens in the years ahead. I have been a student of Japan for 40 years, having studied the language, history, literature, geography and art/film, in university and thereafter. We have many Japanese friends and have visited a number of times. (I have also been a student of the Chinese and Korean cultures.)

Japan is quite different from the U.S. and Europe, with a homogeneous populace and a culture rooted in Confucian values and social hierarchies. Despite the many differences, including definitions of depression, I think it is self-evident that the rising insecurity and workplace changes in Japan result from long-term economic stagnation.

I suspect "new-type depression" may have some universal aspects, as rising insecurity and new demands in the workplace characterize Western economies as well.

New-type depression--NTD--(also called modern-type) is not a classic depression. It does not respond to anti-depressant medications, and it is triggered by events in the workplace--usually criticism from superiors. Those who exhibit the symptoms--difficulty focusing at work, physical symptoms of stress, etc.--tend to be in their 20s and 30s.

With 26% of companies reporting NTD in their workforces, it is widely viewed as a threat to Corporate Japan.

Outside of work, the person with new-type depression continues their social life as before, even as they find themselves unable to go back to work. In other words, they do not suffer from generalized anxiety or anhedonia (inability to enjoy anything in life).

This leads older Japanese to dismiss the NTDs as lazy or spoiled, because the depression is often triggered by demands at work the young worker cannot meet.

Psychologists in Japan are struggling to understand and define new-type depression. Some feel it is a form of rebellion against a rigid society. Others believe it results from poor communication skills on the part of both the younger workers and their senior supervisors.

Why are poor communication skill suddenly an issue in hierarchical Japan? It turns out that Corporate Japan has adopted Western-style management techniques to cope with declining sales and profitability. Job security is no longer absolute in Corporate Japan, and high-level social skills are now required in the "New Economy."

This is also the case in America, where routine work that required only following orders has declined in favor of work that demands constant communication with work groups and and interaction with supervisors. This "New Economy" workplace places a premium on high-level verbal, written and social skills of the sort that females generally score higher on than males.(NTD does not appear to be gender-related, as both males and females experience NTD.)

The "New Economy" in Japan and the U.S. places great pressure on those with poor communication skills and who take their work seriously. Criticism or a failure to keep up pushes the anxiety-ridden worker into new-style depression.

According to Japan’s case of the office blues (Financial Times, free registration required), Corporate Japan has also flattened management levels, U.S.-style, diminishing the traditional mentoring relationship between senior supervisors and junior workers.

This relationship evoked certain aspects of the stern and demanding father-figure, the boss who might yell at you but who looked out for you and nurtured you within the corporate hierarchy.

“It is a generation that faces a situation in which the balance between responsibility and authority is broken,” says Mr Imai. “Also, in the past, there used to be a senpai-kohai [older worker, younger worker] system, where more experienced staff mentored their subordinates, but now everyone is equal, so everyone is alone,” he says.


More than 26 per cent of businesses surveyed last year by the health ministry said they had cases of workers resigning or taking leave of more than one month for mental health reasons. This was up from just 7.6 per cent in a survey conducted three years before. The bulk of those businesses, or 84 per cent of respondents, said problems of mental health affected their business performance negatively.

We can summarize the breeding ground of new-type depression: very demanding work that is beyond the capacity of people with poor social and communication skills and those who fear being left behind or failing. Fearing failure, they wilt under criticism that seems unfair and irresponsible given that they're doing their best. Facing an apparently no-win situation at work, they quit or take an extended leave of absence.

This doesn't solve the depression or its causes, unfortunately. What seems to help is counseling that raises the emotional maturity of the person with NTD so they can better handle criticism, and counseling the senior supervisors to become better communicators with younger workers.

Placing workers with low communication skills in jobs where they can work independently and productively also helps.

The demands on enterprises and employees alike are rising as the "New Economy" of pervasive insecurity and constant adaptation become the norm. The take-away from Japan's new-style depression is that we need to understand not all workers are cut out for the high-social-skill "New Economy," though in the right positions they are admirably productive. That will take a new level of management skills in Corporate Japan, America and Europe as definancialization and deleveraging unravel the global economy.

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Cognitive Dissonance's picture

The social "spread" continues to widen between the classes.

<I seem to have misplaced the middle class. It was just here. Anyone seen it lately?>

francis_sawyer's picture

It's been dismantled to help finance the meddling around in Middle Eastern affairs on behalf of particular interests...

pndr4495's picture

It was left in a basket at the orphanarium on the show FUTURAMA

Stock Tips Investment's picture

Japan has been experiencing significant changes. Not only in its economy. Also in their way of life and their way to relate to the rest of the world. In some aspects, adopted the customs of the West. This is affecting the Japanese society. This type of depression can be one of those consequences.

kaiserhoff's picture

Let's simplify.  There are two types of jobs in the new economy.

Gubbermint jobs..., or part-time, temporary, joke jobs.  What was that about depression?

daxtonbrown's picture

We are in a different type of depression, a biflationary depression, every bit as bad as the Great One. The difference is that the Fed manipulates the indicators to net zero by running simultaneous inflationary and deflationary schemes. But all the Fed can o is push on a rope.

TruthHunter's picture

I suppose the "New Type Depression" is mostly suffered by Narcissists. 

Maybe they haven't made that connection yet...

Panafrican Funktron Robot's picture

"I suppose the "New Type Depression" is mostly suffered by Narcissists."

That comment is clearly lacking in empathy for these people, which is a key trait of a narcissist.  

The issue stated here is something I agree with given my own experience and the experience of other people I know, but I disagree a bit with their conclusion ("poor" communication skills).  I think this shit naturally arises from abnormal interaction constructs.  The U.S. corporate model, especially with "information age" jobs, leads to situation where a lot of people literally can't even describe what the fuck they do, let alone any clarity in the heirarchy or any clarity of work product expectations (because, WE DON'T FUCKING PRODUCE ANYTHING).  The idea that women are better at these "information age" jobs is 100% correct, but that doesn't mean they're any less fucked in the head mentally by these constructs.  

Nothing less than a radical transformation in what the fuck we do with ourselves given partial or full automation of previously manual functions (for which we derived a solidly positive sense of accomplishment) is required, but no, instead we sit in these endless oceans of absurd physical constructs (cubicles) with fucking depressing lighting and no windows, doing shit that we can't quantify or describe, with relatively arbitrary assessments of success or failure (seriously, anyone had a "review" and had that internal empty feeling regarding the entire past year of your life, even if you got mostly 4's and 5's out of 5 on your assessment categories?).  CogDis' Insane Asylum, in living color.

Ludwig Van's picture



P. Funk --

"...doing shit that we can't quantify or describe..."

Nailed it. +1,000.



"I don't have a problem with any of this -- and neither do I."



jayman21's picture

"I seem to have misplaced the middle class. It was just here. Anyone seen it lately?"


Found it.  It was locked up with the unicorns for doing none violent crimes.

GAAPpreNixon's picture

The problem goes beyond middle class straight to cognitive dissonance. As you are probably well aware of by your choice of handle, any society that demands respect and obedience to authority and simultaneously claims said authority can act irresponsibly and unaccountably without a consequent societal implosion is INSANE.

NTD is just the tip of the cognitive dissonance iceberg.

Institutionalized criminal negligence, sadistic treatment of employees and increasingly strident demands for respect voiced by these irresponsible authority figures from their victims of cruel predatory corporate practices will fail because they are the very definition of a dysfunctional society.



Cathartes Aura's picture

I like this line,

increasingly strident demands for respect voiced by these irresponsible authority figures from their victims of cruel predatory corporate practices will fail because they are the very definition of a dysfunctional society.

there's really no need to get into the false definitions of gender constructs to describe the decline of human interactions in employment, and the subsequent depression that can result - anyone that's able to listen to a "customer" or co-worker, and then interact with them based on what is discussed qualifies as a decent employee. 

the problems arise when the job setting is peopled with grade A bullies who need to be obeyed, and have enough job security to enforce their reality on others - who may have better ideas, but realise the whole top-down model is worth-less for aspirations. . . the feelings of entrapment, and debased interactions daily guarantee "depression" because any sane person would recognise the futility of said employment.

the whole "boss/employee" hierarchy is past its sell-by date.  like .gov, religion, etc., it has been based on unquestioned authority, (founding)father-figures, and that's long past due for re-thinking.

edifice crumbling. . .

Umh's picture

Your line "any society that demands respect and obedience to authority and simultaneously claims said authority can act irresponsibly and unaccountably without a consequent societal implosion is INSANE." wraps up modern life perfectly. 


P. S. do you mind if I use it?

Shizzmoney's picture


Retirement No Option for Older Workers in Europe’s Crisis

When Carl Camden joined global temporary work agency Kelly Services Inc. (KELYA) as a senior vice-president 17 years ago, the biggest age group placed in both the U.S. and Europe was younger than 30. Now the largest segment is over 50 on both continents, said Camden, chief executive officer of the Troy, Michigan-based company.

“I do worry about the social fabric tearing apart,” he said in a phone interview. “I worry about social dynamics when economies aren’t growing fast enough to provide jobs for the young. There is a risk of generational conflict.”

insanelysane's picture

Unless "texting friends" becomes an occupation, the young will never be able to get a job.

Shizzmoney's picture

Be thankful "the kids" text.......and have social media to vent........because when THAT is taken away from them (and free speech will, either by the government, or the firing), that's when windows start to get smashed.


Louie the Dog's picture

that's when windows start to get smashed.

I think they are texting to organize the window smashing.

kito's picture

@insanely-----there is always room in the domestic spy program for new employees, stop being so pessimistic:

Cathartes Aura's picture


txtrs spy'g, gamers's pilot drones, all yr bases covered.

Calidreaming's picture

According to Calculated Risk:  Recession averted.  

That McBride guy is a turncoat  - Bernake blinders on.

kito's picture

mcbride just regurgitates government propaganda stats.....i dont bother visiting his site anymore...............

fonzannoon's picture

This article kind of sucks. What is the point? This sounds like people discussing parental teaching methods while sitting on the titanic.

Bicycle Repairman's picture

The point?  The point is the current crisis is your fault.  It's in your head.  It's your failure.  If only you communicated better or were more emotionally whole.  Maybe if you just took your Paxil without complaint.

GAAPpreNixon's picture

wife? Is that you?

Yeah, and she's got a pair of emasculators in her hands waiting for you Corporate Game Theory worshippers to go to sleep.

The bossses have forgotten that respect must be earned by responsible and accountable behavior every fucking day!

Recruiting practices that promise the moon and deliver shit destroy societies.

  Rod Serling: Logic is the enemy and truth is a menace.  

But how is this legal plunder to be identified? Quite simply. See if the law takes from some persons what belongs to them, and gives it to other persons to whom it does not belong. See if the law benefits one citizen at the expense of another by doing what the citizen himself cannot do without committing a crime.

Frederic Bastiat, 1850



MachoMan's picture

This is pretty much it.  I'm curious as to the amount of emotional abuse in the workplace.  I suspect that it is rampant given the respective bargaining positions of the participants.  Essentially, I know too many people with bosses who are completely top down/authoritarian in their communications and style.  Often times this is completely two-faced in that the same people attempt to project a corporate atmosphere where everyone is free to communicate about issues, brainstorm and participate in discussions, and otherwise voice their opinions.  In reality, if anyone dare tries, he or she will be chastised and otherwise reprimanded for the insolence...  albeit in a passive aggressive manner.  If the employee withdraws, then the boss simply points to the "open" communication policy and asks what went wrong?  "You know you can always come to me if you have an issue."

The simple fact is that people who are adept at emotional manipulation and, often times, also fairly adept at emotionally abusing others, tend to excel in the workplace.  Needless to say, I doubt it stops at the workplace, although it might.  I have to think many of these managers tend to have unhappy spouses and families as well.  Maybe it all gets left on the field so to speak, but I have serious reservations about that.

When there is this notion of a "communication breakdown" between older and younger generations, I have to wonder what degree of this breakdown is simply emotional abuse by employers leading younger workers to feel as though they do not have the ability to communicate their misgivings or otherwise assert proper boundaries.  I also can't fathom that this does not present an intellectual drag on the company due to prohibition of fostering new ideas/innovation and communication thereof.

pods's picture

I would say that you have perfectly described many smaller companies from the top down.  

Longer term employees (>5 years) have learned to pretend to have ideas, but do not actually think about any new ideas. 

People learn that a good idea is one the boss likes, irrespective of the positive impact on the company.  And passive aggressive attitudes are rampant. Keeping records of time, etc always lowers productivity.  Once people get that "watched" feeling, they will do what is required to look good.  Not what is needed.

Treat people like kids and they will pay back the favor.  Toss in some token appreciation, two sets of rules,  and you seal the fate of the place.

And yes, I speak from experience.


Cathartes Aura's picture

unquestioned authority, pleasing the parent, emotional manipulation. . .  it's all very parental model, vs.  teenagers saying whatever they think is required by the parent, all the while having little/no respect. 

and because teens are dependent on the parents for food & housing *cough* there can only be passive aggressive acting out until they take full responsibility for their own lives. . . it's the corporate work environment replicating bad "family" modeling, with .gov moving in from behind to micro-manage the whole steaming pile when it inevitably results in failure.

it's a broken authoritarian model that is dis-abling humans.

MachoMan's picture

Clearly I speak from experience too with my soapbox...

But to expand on the issue, I think there is also rampant ageism in the workplace...  The younger generations tend to value work differently.  Pay is not so important as feeling a part of a viable and moral community and having a sense of true fulfillment from work.  [obviously hand sandwiches get old, so pay is certainly incredibly important, but I don't believe it's the primary motivator for production].  The allure of an organization with an "open" communication policy where everyone gets to participate and ideas brainstormed and thunderdome'd, the best idea for the organization coming out on top...  are simply naive fantasies.  In reality, it is a total smokescreen meant for nothing but appearance.  If a new employee comes up with a good idea, it quickly gets shitcanned...  if a new employee comes in busting ass, then he quickly gets woodshedded not to show up the old dogs.  It ends up leading to a feeling of total stagnation (much like the economy at large) and a waste of time.  These dynamics are common throughout all my school friends who've begun duking it out with the job market.

If we're supposed to do this for the next 50 years, then how the fuck is that a fruitful existence?  How is that fulfilling?  How is that worth the sacrifice of time?  The thing is, where older generations would be fine to pull the plow for no reason other than pulling the plow, I think younger generations desire a bit more.  The disconnect between their expectations and the actual workplace is causing some serious problems.  For some, it will simply lead us to find something different...  for others, it will lead to worsening symptoms, depression, suicide, lack of self worth, family issues...  as knowledge of these dynamics expand, we'll find a lot more organizations changing the way they do business (although, the whip is actually the most productive managerial technique, in the short run).

In the end, I think people need to shed away virtually all aspects of the workplace and simply focus on how it evolved and what it really is...  in this case, the simplest explanation is that it is a repository for work referrals and operates purely on wage arbitrage.  As a result, the question must be asked, why do I expect anything more from an institution utilizing wage arbitrage?  How could I possibly think that I could be a peer in this situation?  What about this even implied a fair shake or the ability to meaningfully participate? 

ElvisDog's picture

How is that fulfilling?

Where is it written that a job has to be "fulfilling"? I'm guessing a pretty small percentage of people have jobs that they find personally and professionally fulfilling? A job, first and foremost, is a way to pay the bills and provide for yourself and your family. If you have that and like your job too, so much the better. You were correct in suggesting there is a disconnect in the younger generation between what they expect a job to be and what the reality is. The cause of this disconnect, however, is that the younger generation has been fed a load of crap about how they should expect to find a job that "makes a difference" or whatever and swallowed it whole.

MachoMan's picture

No one says it does...  but the entire article is about the effects upon people, mentally, when this occurs for a prolonged period.  By saying "rub some dirt in it" or "walk it off" or whatever quip you like, I think you're missing the entire point...  which is to offer a viable solution. 

The modern work place is simply not working for people...  especially the younger generation.  I think we're at a point where people are finally second guessing the very essence and nature of work.  The question posed is whether or not it is worth it to kill yourself for someone else's amusement and profit.  I think the younger generations are going to answer this in the negative...  and we'll have plenty of time to ponder while waiting around in mom's basement for the baby boomers to retire, if ever.  

In short, there is some happy medium between keeping people employed for life and taking a shit on them every chance you get...  It's just another symptom of a broke dick society. 

Umh's picture

I agree with you completely. On a side note; I've noticed that kiss asses expect to have their ass kissed. Another way of looking at this is that they expect the same treatment that they give out, they are still assholes.

centerline's picture

NTD is just the warm up act.

Quinvarius's picture

Sounds like a pay issue. 

Shizzmoney's picture

As a young worker, part of pay.  If we were paid more, we wouldn't obviously be bitching as much and it would be easier to "deal with it".

But also, the demands, stress, and pressures put on by management to whip the slaves into optimal productivity in the name of keeping that stock price up.

Corporations and management wants more out of their workers, but won't reward those workers with more pay that doesn't keep up with "real" inflation. 

I'll get a raise next year, but it will only be 2.5% (based off of the manipulated CPI number).  I don't make that much where 2.5% is an significant increase into my life costs (food, rent, energy, public transit) and cutting into debt costs (student, CC).  The only young folk I know who are getting a mortgages for houses/condos, are those in high paying and safe positions (i.e. Eye Doctor or Engineers at BioTech firms).  It is essentially a form of "unnatural selection".  Ante off the workers who are expendable.  Fuck 'em.

And those "costs' are getting passed on to the bottom of the "employment chain" - the worker.  Especially the younger's really condescending to hear these baby boomers talk down to us while they make their high 5,6 figure salaries not understanding that the reason theyt have things that I don't isn't because they "saved" was because they had easier access to debt (and could pay it off as  they didn't deal with the inflation/deflation we deal with today). 

While I am working 2x's as hard as they did, and only making 1/3rd as much....not enough to save, discretionary spend, enjoy weekends as I am exhauted after 50 hours weeks (including commute)......and of course, afford college/car/house.

And after dealing with these assholes, especially my main boss (who is a micromanaging email tyrant), they have the gall to keep saying "thank you", thinking it's a polite courtesy while she oversees EVERY SINGLE LITTLE THING I DO. 

Well guess what?

"Thank yous" don't pay the bills. 


To see the blinders they have on in their eyes, it really is fucking unbelievable. 

They have no idea what is coming once the bubble pops. 

The rubber band is being stretched to its limit. They'll never see the rise of progressive libertarian anarchism coming.

Zadok's picture

Superb summary Shizz! Good grasp on reality, try not to lose it, the grasp on reality I mean.

fonzannoon's picture

That is a great summary. The key is that it's not going to change voluntarily.

Zadok's picture

Nope, this last play is 99 years old and on the verge of splendid execution, of course debt forgiveness will not be coming soon. That is the entire premise of the exercise, debt servitude. Almost there...almost there...

MachoMan's picture

I can say for quite a few other professionals that this type of system is going to come to a screeching halt soon and it isn't all bad.  Believe it or not, the younger generations are vastly better at using technology to be productive, especially in marketing.  Realistically, every employer is simply a work referral entity gaming wage arbitrage.  What has happened is that in professional services, among others, the pay for new entrants is nil while the barriers to entry are likewise nil (commercial r/e is cheap as hell, telecommuting is cheap as hell, pre-packaged websites are cheap as hell, office supplies are cheap as hell, etc.).  This leads to there being very little opportunity cost in rolling your own.  The only issue is simply getting the necessary referrals/demands.  If you can set yourself up as a hub to get work referrals/client demands, then you're set...  that's it...  now you can even participate in wage arbitrage if you want.

Obviously you can't just build a multimillion dollar manufacturing facility for shits and giggles...  the above simply has nothing to do with that...  but we are primarily a service based economy (quickly shrinking)...  many employers, by taking advantage of wage arbitrage and the present economic conditions, have also opened the door for direct competition...  having trained their competition, no less. 

If employers wanted to give a little more of a fair shake on things, then they could really, really ring that cash register much more over time.  What they're going to do is force young, disgruntled and similarly situated workers to break off and create competitive businesses.  The opportunity cost for doing so is too low not to try...    

geoffb's picture

"The opportunity cost for doing so is too low not to try..."


That sums up how I feel about it verbatim. Said the same words to my wife who is lamenting my starting a business instead of trying to get a different job that gets more hours. When I get a raise its basically a joke, because my hours get reduced so I never make more than a certain amount. I don't blame the company, they do what they've got to do, but my business startup is to automate my job. If I don't do it, someone else will. Then I'll be out of a job. Companies who are racing to the bottom of the cost structure won't be a going concern soon, imo. So no use going anywhere else.



Uber Vandal's picture

Have you ever sat back and wondered how people from 1975 to 1983 paid anything off when interest on mortgages were around 15+%?


fonzannoon's picture

Good question. Let's use my Dad as an example. He bought his house for 35k in 1975. His wages rapidly rose through the 80's. His home price appreciated during the same period. Also his brokerage account appreciated with the stock market bigtime during the same period while at the same time the dollar was stronger. Therefore prices of goods stayed low, therefore not eroding his wages.

As opposed to me, who bought in the same area in 2007. My mortgage rate is 4.625% as opposed to 15% but I paid $515k for a similar house. I have to contend with this stock market, this housing market and the dollar shitting the bed. Stagnant wages and this employment environment to boot.

Which situation would you prefer? I am not crying a river. It is what it is. I bought my ticket and and digging my way out.

kito's picture

dont worry fonz, all of the experts now say housing has turned the will be fine...your house value will soar over the next 15 years....dow will be at $30,000 soon enough..........downturn---its only cyclical.....thats what cnbc says.............

fonzannoon's picture

Yeah I agree. Bernanke must be in panic mode knowing he better start raising rates asap to put a lid on this exponential growth.

kito's picture

HAHAHAHAHAHh RAISE RATES YOU SAYYYYYY HAHAHA HAHAHH------ imminent implosion in 1) shadow banking 2) housing 3)u.s. debt ------yep raising rates will be welcomed...i hope romney wins if only so i can shut the imbeciles up ---the ones who keep harping on the fact that he will be fiscally responsible, balance the budget, bring in a fed hawk.....its laughable how naive the herd is....................

Uber Vandal's picture

I suspect your dad was not out of work for 2 years due to being in the construction trade, and lost all of his seniority, and had to start over again, during the 1980-83 recession?

When you start at the bottom of the wage scale again, or the only jobs you are "qualified for" pay $3.35/hr, things got a bit dicey.

A lot of people tend to forget that recession, and of course, everyone's experience and view points will differ greatly on anything.

However, all of that was not all bad, for I vowed to never make the mistakes my parents did, such as presume you will have a job, presume you will be healthy and not blow your knee out working a new job and then be let go, presume the money you have will last, presume your relatives or friends will help you when things get dicey.


pods's picture

I'd take 15% on a $60k note back then over 4% on a 300k note now.  Toss in decent wages, low property taxes, and access to credit before everything and anything was financialized and fuck yeah I would take it.

In the beginning of a ponzi everyone does well.  If you can point to this time as starting in 1971, then yes, people were able to do stuff back then, especially since "free trade" had not entered the lexicon and the majority of items were not financialized.  

Now everything has been financialized, increasing the price, and salaries are in the toilet. Toss in higher taxes/fees and burdensome regulation and you can see how shitty things are.