Employment Overview: Japan

Asia , Employment Outlook Nov 21, 2023 No Comments

The future looks bright as Japan returns from COVID-era economic and employment issues.

Like most countries, Japan’s economic performance has been significantly affected by the COVID-19 global health crisis, and its GDP has been shrinking for several consecutive terms since the beginning of the pandemic. The world’s third-largest economy, the country’s financial situation is expected to strengthen by the end of the year, and employment is expected to rise. In the next 24 months, the labor force is expected to return to pre-virus levels and the national GDP to return to annual growth rates between 2% and 3.5%. Inflation will also return to a positive rate, increasing to 0.7% in the next few quarters.

Experts foresee improved hiring prospects in the coming terms, as 17% of Japanese employers expect to increase their payrolls. Opportunities should soon expand in all sectors, according to the latest data by Manpower. Most of the new positions in the short term will be generated in accounting, finance, and insurance, as well as in the real estate sectors, followed by services and construction activities. General unemployment levels are expected to decrease in the coming quarters as the country’s economy returns to pre-pandemic trends.

Key Employment Trends

Women Needed: Japan’s gender gap in the workforce remains a significant economic concern. Recently, the World Economic Forum ranked 117th among 156 countries in its Global Gender Gap Report. Although some progress has been made in recent years (such as the Equal Work, Equal Pay legislation, implemented in April 2020), women get paid, on average, 43.7% less than men in the country. One of every two employed women in the country works part-time.

Expatriate Workers: Foreign workers are needed to help address the nation’s shrinking labor force and aging population. In the years before the pandemic, the government introduced a new designated skills visa category (also known as ‘specified skills’ visas) to attract 500,000 new foreign workers by 2025 in agriculture, nursing, construction, and shipbuilding. As the COVID-19 restriction will ease in the coming terms, hiring managers expect to start recruiting foreign professionals again under this program.

Contracting and Temporary Jobs: While Japanese professionals were not so used to temporary recruitment until very recently, the new job demand accelerated by the pandemic and the Equal Work, Equal Pay legislation made the workforce open to more flexible arrangements. This has made the job market more attractive for young candidates and more dynamic, particularly for high-level professionals who used to apply only for permanent positions.

Areas of Job Promise

Despite the disruptions imposed by the pandemic on the country’s job market, the following sectors register some of the highest hiring activity, according to the latest research by Michael Page:

  • Financial services
  • Retail
  • Professional services
  • Technology & telecoms
  • Fast-moving consumer goods (FMCG)

Top Occupations

The following job types have recorded the highest hiring activity in the country, according to Michael Page:

  1. Finance
  2. ICT / technology
  3. Marketing
  4. Digital marketing procurement and supply chain

Skills in Demand

Recent research by Manpower has found that the workforce is experiencing the largest reallocation of skills since World War II.

Today, the number of Japanese employers that confirm difficulty filling jobs has declined to 76%. This figure is currently the result of reduced employment opportunities but also the effect of vastly different skill blend requests.

As the pandemic accelerated the digital revolution and normalized new work dynamic changes, Japanese employers are requesting a new mix of technical skills and human abilities for future jobs, particularly in the following areas:

  • IT / data
  • Sales / marketing
  • Front office / customer facing
  • Operations / logistics
  • Manufacturing / production

The professional environment disruptions caused by the pandemic have also made soft skills more important than ever before, as teams have had to show more resiliency and collaboration. These are the most valued soft skills in the country today, according to Manpower:

  1. Accountability, reliability and discipline
  2. Leadership and social influence
  3. Creativity and originality
  4. Collaboration and teamwork
  5. Reasoning, problem-solving

By Mary Anne Thompson, founder and President of Goinglobal, Inc.

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Mary Anne Thompson

Mary Anne Thompson founded GoinGlobal, Inc. more than two decades ago as a result of her own experiences job hunting in Sweden. She believes that to uncover the real job opportunities, you need the experience and personal insights of trained local specialists. Mary Anne continues to be an active CEO who shares her strategies and insights directly with clients to help them strategically maximize GoinGlobal’s unique resources.