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This paper studies the labour market transitions of female workers from 1993 to 2004, a period of unprecedented economic stagnation for Japan. It provides an excellent setting to investigate how workers are affected and how firms have adjusted their workforces during difficult economic times. To achieve this purpose we use data from the Japanese Panel Data on Consumers to investigate the determinants of labour market transitions for female workers. While a number of the customary demographic and sociological determinants such as marital status and low levels of education are important, there is evidence that workers in trade-exposed industries were more likely to move to part-time jobs. On the other hand, we find no evidence to support the commonly made claim that globalisation has been responsible for the changing nature of the Japanese employment relationship.