A Japanese workplace with people being busy at their desks

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Japan plays host to the world’s third-largest economy. Following the devastation of World War II, Japan’s market economy grew extraordinarily rapidly for several decades. Today, the country is known for its extremely efficient and educated workforce. It’s also acknowledged for its high productivity and low unemployment rate.

Japan’s unemployment rate stood at 2.4% in January 2023 but went up to 2.6% in February 2023. However, this is lower than the projected unemployment rate of 5.8% or 208 million people in 2023.

In this post, we will review Japan’s recruitment trends and statistics and discuss what makes the country’s workforce so successful. We will also take a look at the challenges that Japan faces with respect to its workforce and try to understand the implications of these recruitment statistics for businesses planning to expand into Japan.

Japan’s Recruitment Trends and Statistics

The average monthly salary in Japan is ¥515,000, which means the average annual salary stands at ¥6,180,000. However, it’s crucial to remember that salaries vary drastically between different careers, stages of employment (entry-level, mid-level, C-suite, etc.), qualifications, work experience, and even location. For instance, in Tokyo, the average salary earned by a software developer is ¥4,402,832 (according to payscale), while that of a senior software engineer is ¥7,580,152.

Average Monthly Salary

According to salaryexplorer, Japan’s monthly salaries vary from ¥130,000 (starting salary) to ¥2,300,000 (maximum average salary, but the actual maximum is higher). The country’s median monthly salary stands at ¥471,000, which means that 50% of the population is earning less than ¥471,000 while the rest half is earning more.

Jobs and Employment Websites

When it comes to jobs and employment websites in Japan, the top 5 spots are taken by the following:

  1. indeed.com
  2. doda.jp
  3. rikunabi.com
  4. townwork.net
  5. baitoru.com

Jobs-to-Applications Ratio

According to TRADING ECONOMICS, Japan’s jobs-to-applications ratio decreased to 1.34 in February from 1.35 in January 2023. Jobs to applications ratio is the ratio of the number of job offers (the sum of the carried forward ones from the earlier month as well as new ones) to the number of job seekers registered at “Hello Work” (Japan’s public employment security offices). You can calculate this ratio by dividing monthly active job openings by monthly active applications.

Job Vacancies

Japan’s Job Vacancies

According to Japan’s Ministry of Health, Labour and Welfare as quoted by TRADING ECONOMICS, the country’s job vacancies in February 2023, reduced to 896.43 thousand from January’s 899.87 thousand.

Statista forecasted the country’s number of employed people to continuously rise between 2022 and 2023 by +0.3%, with the estimated figure reaching 67.54 million people in 2023.

Labour Force Participation

According to CEIC, Japan’s labour force participation rate stood at 62.2% in Jan 2023. It was a slight decline compared to the previous month’s rate of 62.3%.  Despite its low unemployment rate of 2.4% (in January 2023, as mentioned earlier in this post), Japan’s youth unemployment rate climbed up to 5.20% in February from 4.50% in January 2023. Since this is higher than Japan’s overall unemployment rate, it could adversely affect the country’s workforce in the long run.

In Japan, females made up 44.6% of the total labour force according to 2021 data from the World Bank. According to Statista, in 2022, almost 69% of the country’s male population aged 15 years and older were employed, while more than 53% of the female population were employed. This female employment rate was a record high in the country.

Japan still has a gap between the number of females and males employed. Some attribute this gap to the lack of gender equality in the workplace and the absence of adequate support for working mothers. To encourage women’s participation in the workforce so they can contribute more to the economy, Japan needs to address these issues.

Foreign Workers in Japan

If reading till here made you believe that Japan relies just on its native people, think again because the country had a whopping 1.82 million foreign nationals employed as of the end of October 2022. Vietnamese, Chinese, and Filipinos hold the top three ranks among foreign nationals in Japan’s workforce. But that’s not all.

Despite labour scarcity, 2,98,790 workplaces in Japan employed foreign workers, which indicated a rise of 4.8%. Businesses with less than 30 workers, which form over 90% of firms in Japan, made up 61.4% of the employers with foreign workers.

Industry-wise, Japan’s manufacturing sector employs the most foreign workers, who account for a quarter of the total. The number of foreign workers in this industry went up by 4.2%, which was a rise for the first time in three years. In the wholesale and retail industry, foreign workers’ employment went up 3.9% after a slump in the previous year. A 2.7% rise was seen in the lodging and restaurant industry.

Since foreign workers make up a considerable segment of Japan’s total workforce, it highlights the country’s welcoming attitude toward the contribution of international labour to its economy. The figures above also indicate the potential for further growth in the number of foreign workers employed in Japan, who can then contribute more to the country’s economic activity and even help create job opportunities.

What Makes the Japanese Workforce Successful

Lifetime employment with a solitary company is still common in the country, especially with big corporations, and employees are expected to stay there forever. It’s no surprise to find emphasis being laid on dedication and loyalty to one’s company because these values are instilled in Japanese people from a young age. Since Japanese children learn to work hard and take pride in their work, they grow into adults with a strong work ethic, which makes Japan’s workforce successful.

The country’s focus on education is another reason for its workforce’s success. Did you know Japan has the world’s second most educated population, after Switzerland, and sits ahead of Sweden, which occupies third place? As it’s one of the most technically advanced and literate nations, Japan has become a favourable destination for those looking to set up or expand their business in East Asia.

Japanese work culture is rooted in a deep sense of commitment to both the work and the company. The country’s workforce has a strong sense of appreciation and responsibility toward its work and considers its workplace a second abode. Japanese companies are also known for their extremely process-oriented approach with attention to quality and micro-details. All of these contribute to the success of the Japanese workforce.

But there are a few pain points too. Though globalisation is changing things for the better fast, people still complain about the Japanese workplace’s lack of transparency, rigidity, and slow decision-making. Organisations in Japan have also struggled to match global standards of expectations in terms of gender equality and racial diversity.

Who Can Help You Find Suitable Talent In Japan?

If all these statistics and trends have made you eager to set shop in Japan but you feel lost about hiring the right talent, it will be wise to partner with an international headhunting firm with a rock-solid Japanese presence like InHunt World.

From entry-level candidates to C-suite executives, finding suitable talent in Japan can become faster and easier with expert headhunters at work.

Are you ready to set the ball rolling? If yes, you can reach us right away!

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