On August 16, 1945, one day after Japan's unconditional surrender, Konosuke called his senior managers together and announced plans to resume the production of consumer goods. Four days later, in an appeal delivered to all the employees, he said, "Production is the very foundation to our recovery. Let us reawaken the traditional Matsushita spirit, and address the task of rebuilding the nation and enriching people's lives."
Under the direction of General MacArthur, the occupation forces quickly instituted democratic reforms in Japan, including the establishment of labor unions.
Appearing at the first meeting of the company’s labor union, held in Nakanoshima Central Public Hall, Osaka, Konosuke quickly won the support of his employees by making it clear that he placed a high priority on their interests, and that the best policies for labor and management were bound to converge.
But the company’s recovery suddenly faced a major obstacle. The occupation forces issued several directives that halted the company’s operations and threatened its very existence. These laws were intended to break up the “zaibatsu” or family-controlled industrial and financial groups that had existed in Japan for generations. Outraged that such laws were directed at his company –an independent enterprise just 30 years old— Konosuke visited the Allied General Headquaters Office more than 50 times, and Executive Director Arataro Takahashi went to negotiate with the Occupation leadership nearly a hundred times.
Because the company had manufactured military hardware during the War, Konosuke was ordered to step down as president. But in an unprecedented move, the labor union, retail stores and company’s affiliates demonstrated support for him by a petition to rescind the resignation order, saying that Konosuke was indispensable to the company’s reconstruction. In a rare reversal of policy, in May, 1947, the Supreme Commander of the Allied Powers permitted Konosuke and the company’s directors to remain in the company.