Recruitment in Japan

Steve Crane chats with experienced lawyer, Hiroshi Chiba, of Uchisaiwaicho Law Firm. With his speciality in employment law, Chiba-san provides key insight on the subject. From recruiting and managing staff in Japan, through the particularities of Japanese employment law,

The discussion includes:

  • What does the term ‘Job for Life’ mean and is it still relevant?
  • What are the essentials to be aware of when recruiting and hiring local staff?
  • Recruitment, Interviews, Contracts, Trial Periods: how does it work in Japan?
  • What happens if things go wrong, and what to do about it?
  • Is there any flexibility when it comes to Japanese Employment Law?

 


All You Need To Know About Recruitment In Japan

Staffing and recruitment in Japan is one of the main challenges a company can go through when entering the Japanese market for a variety of reasons.


Limited Talent Pool:

Generally, Japan has a narrow talent pool of bilingual professionals which can be attributed to an inadequate English language education system, a low birth rate and some cultural traits.

According to the Japanese government, only half a million employees work for foreign corporations, compared to 42.5 million workers in large and mid-small Japanese corporations.

Non-Japanese companies looking to make their first hire need to recognise that the recruitment ecosystem in Japan is different from that in most other developed countries.

Japan has a healthy economy with a booming employment market. The interest generated by the upcoming Tokyo Olympics and Paralympics in 2020 and the Rugby World Cup in 2019, coupled with a weak yen are bringing new companies into the market at an accelerated pace.

These dynamics along with certain migration restrictions are causing a supply and demand situation whereby the job opportunities are on the increase but the size of the workforce remains constant.

This makes talented people hard to come-by and recruiters’ fees expensive. In fact, the market’s standard recruitment agency fee in Japan is 30 to 35% of On-Target Earning (OTE) compared with 20 to 25% in most of the northern hemisphere.

The image of the Japanese as a nation of entrepreneurial go-getters is 30 to 40 years out of date. The people in the labour market today are the children of the entrepreneurial generation that rebuilt Japan after the Second World War, and created the “Japanese miracle”.

Safety, reliability, dependability, work-life balance and a good corporate brand name are very high on their list of priorities when selecting an employer.

Salary is of course very important, and must be highly competitive, but spurious promises of meteoric growth and market domination cut very little ice, unless your company has a blue-chip global presence already, and demonstrably deep pockets.


Main Considerations for Hiring Japanese Employees

Making sense of the increasing demand over a narrow talent pool in Japan is only half the battle for new companies entering the market. The second half is winning the candidates over.

Sourcing talent in Japan is not as easy as posting a job advert and then accepting applications. Job adverts have exceptionally low response rates in Japan, especially if they are not translated to Japanese.

Hiring companies need to put in a great deal of thought and effort into their recruiting process to attract candidates.

Japan until very recently had a very rigid career structure. Most people applied for a job only when they left school or university, and remained in that job until retirement, which created a culture of lifelong employment. Although times appear to be changing, it remains the case that most people work for one or two companies only throughout their career.

The Japanese are inherently risk-averse and need to be thoroughly convinced that your offer and the opportunity to work for you are worth making the switch.

In addition to that, there is a stigma associated with being disloyal, and dishonest to the employer. Individual ambition is discouraged and people are expected to be extremely loyal to their company.

These cultural specifics imply that foreign employers need to up their game considerably, enough to attract and keep talent.


How to Source Japanese Talent

a. The Network Power:

The Japanese value building relationships and fostering trust which constitutes a great value asset.

As a result, companies have the choice to tap into the potential of their networks and ask for referrals.

b. Recruitment Agencies:

Recruitment consultants have a good understanding of the cultural differences in Japan and methods to attract and engage suitable talent.

Recruitment consultants can help you bring out your unique selling points and advantages to encourage suitable candidates to make the switch.

It is advisable to spend the time and budget building your company’s brand.

c. The Internet:

The Japanese cherish their privacy and are not fans of putting their details out there on the internet.

LinkedIn for example has seen very slow growth in Japan. This could be due to a reluctance to share personal information (such as real names) online and a reticence towards appearing boastful.

In contrast, social networks such as Twitter and YouTube have seen more success because they offer anonymity and allow users to sign-up with usernames rather than a real name. This means that the internet has not been as good a tool for finding talent as it has been in other countries, but things may be changing – particularly for younger Japanese candidates.


Interviewing Japanese Candidates

It is worth keeping in mind certain cultural traits when interviewing Japanese candidates: modesty and honesty.

Japanese candidates would generally under promise and over deliver. If they think they can do 10 out 10, they will always say they can do five.

You’ll have to really probe deep and pull the good things out of people. You shouldn’t ask a Japanese candidate about their weaknesses in an interview because you’ll hear answers like ‘I’m bad with numbers’ or ‘I’m lazy…’ etc.

Japanese candidates may struggle to up-sell themselves. Instead, ask about actual work scenarios and thought processes to determine a candidate’s level of skill.


From the archive:

View our podcast on ‘How to Find the Right Candidate in Japan’ featuring Kevin Holdaway of Gplus Media

Our podcast on recruitment in Japan with Kevin Holdaway from Gplus Media. Listen on Apple Podcasts


Last updated January 2024: Steve Crane OBE