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80% of companies have staff shortage and same wages for foreign and Japanese staff

A survey by The Japan Research Institute revealed that almost 80% of companies in Japan do not have enough staff. The same survey also shows that the gap between the salaries of foreign and Japanese workers is decreasing.

Nearly 80% of companies answered that they don’t have enough new employees or mid-career workers. 30% of companies within that 80% also said that they don’t have enough workers of any age.

To deal with this shortage, companies are mainly planning on training and cultivating their talent. However, they’re also placing importance on hiring more seniors and women, as well as foreigners.

Large companies hire many foreigners. However, small to mid-sized companies are also positive on hiring foreign workers for positions outside of technical fields, such as part time jobs. Such companies tend to focus on younger hires (34 years old or younger), especially in the retail, lodging, and food and beverage industries. The nationalities of these foreign workers vary. Many companies have been hiring Chinese (one of the biggest demographics in Japan), and there has been more hiring of workers from other Asian countries, such as Vietnam, the Philippines, and Nepal.

Many companies answered that they hired and utilized foreign workers because they didn’t have enough staff. However, the skills and personality of these workers, as well as their ability to deal with inbound foreign customers, were also important reasons.

There were many companies which answered that they considered character, personality, and Japanese skills when hiring foreign workers. Fewer than 20% of companies answered that they will hire anybody due to lacking staff.

77.1% of companies said that the wages of their foreign workers were at around the same level as Japanese staff. On the other hand, 11.8% of companies answered that the minimum salaries are around the same for foreign and Japanese employees. The smaller the company, the higher this ratio was. Furthermore, companies with higher revenues had smaller wage gaps. Regarding training and educational systems, large companies tend to cultivate their staff to be future executives, whereas relatively more small to mid-sized companies wanted to offer mandatory Japanese language training.

Just under 80% of companies are satisfied with the performance of their foreign workers. Some problems they cited include communication problems and term limits for employment. As for the future of foreign employment, 20% of companies are thinking of ways to approach it with self-reliance. However, since the competition for talent is expected to become more intense, the same percentage of companies thinks that the government should pay the related costs.

This survey was conducted from January to February 2019. It was aimed at just under 10,000 companies total – 1,559 listed enterprises and 8,429 unlisted enterprises with a relatively high rate of foreign employment, such as food processing, fibers and clothing, machines and metals, construction, food and beverage and lodging, and retail.

[Reference page] Results of Staff Shortage and Foreign Employment Survey

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