By Kwan Weng Kin, Japan Correspondent

TOKYO: College student Hitomi Enomoto is not optimistic about landing a job in the travel industry before she graduates this spring.

Since the 22-year-old started job-hunting about a year ago, she has received only one offer - from a firm selling computer equipment. She rejected it to pursue her dream of working in the tour industry.

But with news in recent weeks of companies cancelling job offers to graduating students due to the deteriorating economy, she expects the going to be tough.

Aware that rescinding job offers amounts to a legal breach of contract, some companies have reportedly taken to asking students to voluntarily decline job offers without penalty.

Worried about the trend, the Aso administration is considering revealing the names of companies that have withdrawn job offers to college students.

Thankfully, the number of students involved is relatively small - about 770, according to the latest official figures.

But career counsellors at universities nationwide are warning students that the employment situation - a seller's market in the past few years - has now entered an 'Ice Age'.

Job-hunting in Japan is a long-drawn-out affair, beginning long before a student graduates.

In recent years, many students have begun job-hunting midway through their third year at university.

They start by scouring specialised Internet recruitment sites and visiting company websites for more detailed information.

After rounds of tests and interviews, many students land job offers before they even begin their fourth year of studies.

So most major companies have already finished hiring for this year by the early part of last year and expect to welcome their new batch of employees in April.

But for job-seekers who expect to start work in April next year, there is great uncertainty ahead.

Plunging overseas demand and the appreciation of the yen have seriously dented Japanese exports, drastically eroding the profits of carmakers and other companies.

Still, many companies recognise that the downturn cannot last forever and believe they should continue existing hiring policies to ensure they will have the talent needed to foster future corporate growth.

According to a survey published on Dec 22 by the influential Nikkei business daily, 41.2 per cent of companies surveyed say they expect to hire as many students for next year as they did for this year. But 22.1 per cent of companies say they expect to be hiring fewer of them.

Carmaker Honda, for instance, has already indicated it would cut hiring by 10 to 20 per cent for next year, and Nissan is also expected to take on fewer students.

But with the global economic outlook still murky, many companies have not made up their minds on what to do.

The gloom in the current job market is unmistakable, especially as many companies are busy shedding staff.

In the past, Japanese employers were known for their reluctance to let staff go.

But in the early 2000s, the Koizumi administration, in the name of labour reforms, gave the green light for corporations to increase the proportion of part-timers and contract workers on their payrolls so that they will have more flexibility to adjust manpower costs during a downturn.

In the past few weeks, many companies did not hesitate to fire such non-permanent employees when they were forced to cut production.

Early last month, Mr Fujio Mitarai, head of Japan's powerful business organisation Nippon Keidanren, told government leaders that Japanese companies would do their best to secure jobs.

Yet several days later, Canon, of which Mr Mitarai is chairman, announced it would sack 1,100 contract workers at a digital camera plant in southern Japan.

Permanent employees, too, are not safe, especially now that electronics giant Sony has decided to fire 8,000 regular staff around the world, including an undisclosed number in Japan.

But though major export-oriented companies are trimming workforces, there are actually still many jobs available at small companies.

Which is why Ms Enomoto is not fazed if she ends up not getting a position with a company offering tour conductor services - her last hope of gaining a foothold in the travel trade.

'I am not so optimistic about finding a job in the travel industry. But I am not that worried. There are still lots of job ads on the Internet. If one is not too fussy, there are still many jobs to be had,' she said.

Incidentally, not every business fares badly in a recession.

Digical, a small publisher of business publications with a staff of just 12, will be taking on three new employees in April, including college student Yusuke Tonosaki.

'My company foresees that in a downturn, there will be a surge in demand for books telling people how they can raise productivity and run their businesses better,' said Mr Tonosaki, 23, who cannot wait to graduate and start work.

This article was first published in The Straits Times on Jan 10, 2008.