08/09/2020

Employment of Foreign Nationals as Workers, Labor and Visa Policy Reforms in Japan

An growing portion of Japan’s population is aging, and to support the economy, the country looks at foreign nationals to fill any labor shortage gap that may occur. Major reforms and policies are being implemented for the future; for now, Japan is trying to steady its economy. 


Table of Contents


The Population Situation

Since Prime Minister Shinzo Abe promised to get rid of deflation less than a decade ago and to lift up Japan out of the economic doldrums, the government has aggressively pumped up government spending along with relaxed monetary control and implementation of various reforms, including the increase of consumer tax. Slowly, the Japanese economy has recharged itself, allowing stock prices to pick up and usher in brighter prospects for increased investments in spite of serious issues involving the labor force. 

The challenges Japanese economic leaders face pertain to certain conditions that most countries do not commonly encounter, for instance, low unemployment. Contrary to general expectations, this desirable condition has not brought about the desired increase in salary rates in Japan, or even in the global scene. In theory, workers’ pay should have grown as a direct result of the prevailing shortage of people to fill up job vacancies, but this has not happened at all. Whatever the reasons are, economists and policy-makers have their hands full looking for possible measures to resolve the issue.    

Some other challenges include the prominent part-time work and "job for life" culture wherein both can negatively affect the growth of income as these tend to “capture” workers to settle for fixed-salary jobs, making a competitive market less competitive, hindering salary growth. As Japan, like other modern countries, inevitably sinks deeper into the process of globalization, the working culture gradually changes. It has become more acceptable to change jobs, and other positive mindsets are also slowly coming into places. Growth in the economy can be expected from such positive changes.

Aging Population

Another major hurdle the Japanese nation faces is its ageing population.  According to statistics, for 2020, an estimated 35.9 Million, or 28.4% of Japan's population are aged above 65 and it is expected to increase. The projected numbers for 2050 estimates those aged above 65 to be around 39.8 Million or 37.7% of the population. From the initial 28.4% to 37.7% is an impactful 9.3% increase, further largening the imbalance. With more people reaching retirement age and fewer young people taking over the vacated jobs and the many new positions opening up, the government does not have only the burden of financially sustaining the needs of the elderly population but also of sourcing out workers from within the nation or overseas in order to maintain overall economic viability. 

※ The Japan Institute for Labour Policy and Training, "第2-5表 老年人口(65歳以上人口)"

Japan’s requirement for a ‘healthy and young’ workforce demands the influx of thousands highly-skilled and dedicated foreign workers, a condition that may have been anticipated in previous decades but which had not been formally addressed. For many years now, however, the increase in the population of multinationals with permanent resident status in Japan has helped to somehow ease the deficit in the labor force, along with thousands of foreign students who have been given the privilege to take on part-time jobs.

National Attitude and Reform towards Foreign Workers

The loosening of immigration rules to allow more foreigners to enter and work in Japan has led to the passing of laws and implementing rules to help applicants to secure proper visas and to make their transition to Japanese society and culture more manageable while reducing potential exploitations by some unscrupulous employers. Shoko Sasaki of the Immigration Services Agency has vowed to take up the cudgels of foreign workers and assure them of full support through all the steps taken to fulfill their individual goals as well as putting their skills and talents into their highest possible use. Many of the workers needed are those who possess enough proficiency in the Japanese language and skills that will qualify them to become residents with Specified Skilled Worker No. 1 visas, such as nurses, farm workers and construction laborers, for a period of five years, with the option to extend. 

※ South China Morning Post, “Japan eases immigration rules to let in more foreign workers under new visa system

Just like other nationalities, Japanese people have concerns about foreigners entering their country and posing as a threat to citizens who will have to compete for jobs in their own country, as well as for the introduction of foreign influences into Japanese society and culture. While a valid concern in itself, it could also be to Japan’s advantage, in fact; for, as a country, it has always been conscientious in preserving its own cultural heritage whether its citizens reside in Japan or in other lands. Cross-cultural exchanges and interactions are unavoidable realities yet are also welcome opportunities in global dynamics that can only lead to better understanding and cooperation among nations.  

Specified Skilled Workers Visa

The reforms passed to address the labor shortage through hiring foreign workers involves establishing new policies to facilitate the issuance of work visas particularly for various types of blue-collar jobs. The new visas to be issued, however, do not give workers the privilege to become immigrants but only as temporary residents. Applicants are also required to submit recommendations of their sponsoring Japanese employers as well as documentary evidence of qualifying skills tests and Japanese language proficiency.

Jobs available for filling up cover various prime industries, categorized into two kinds of work visa. The first includes workers in construction, food services, fishing, agriculture, cleaning fishing, vehicle repair and industrial machinery operation, which are jobs for workers with limited work skills. Family members of such workers will not be allowed to reside in Japan, unlike the second group which includes highly-skilled workers in such fields as IT, engineering and other professions. For details of the new status of residence applicable for foreign nationals for specified skilled workers visa, please refer to the Ministry of Foreign Affairs website.

※ Ministry of Foreign Affairs of Japan, "Specified Skilled Worker"
※ Japan International Trainee & Skilled Worker Cooperation Organization, "What is a "Specified Skilled Worker" Residency Status?"

A Turn for the Better

With the government drive to instill better work-life balance among Japanese as well as foreign workers, the workplace culture is expected to improve even more and, thereby, provide greater occupational stability and employment satisfaction which will in turn stimulate a more robust business environment that will produce renewed economic growth on a wider scale. One clear proof is provided by the Ministry of Health, Labour and Welfare in its report that as of late 2019, there were over 1.6 million foreign workers in Japan, a record-breaking high from previous years. In a way, this turn of events will test whether these reforms will work or not in the long run.

※ Ministry of Health, Labour and Welfare, "Summary of Notification Status of "Foreign Employment Status" (As of the end of October 2019)" 

Japanese leaders realize the value of propping up the confidence of business managers and company owners so that they can begin to seek innovative ways to hire more people and provide higher compensation within a climate of positive national renewal and economic resurgence. Prime Minister Abe’s determination to increase pay for foreigners equal to or higher than that of Japanese nationals proves the government’s commitment to achieve positive results. Only by understanding and cooperating can the business players end up contributing to the reduction of the deflation of the economy and also helping to address the burden of national debt that brought about the deflation. 

Summary 

Recognizing the exact problems can clarify one’s position in the future, a process that has brought about the bold steps that Japan has taken in its strategies to maintain its position as a pioneer and leader in global technological and economic progress. It has been a rough journey toward instituting national reforms to reconfigure the priorities in the traditional criteria used in hiring foreign workers in vital sectors of society. With more business leaders experiencing the labor crunch due to an ageing population and the growing need for fresh, young talents to energize commerce and industry, sourcing out labor from beyond the shores comes as an invigorating albeit challenging solution. But now foreign nationals can take advantage of this opportunity to start a new life in Japan as the national reforms promise to support those who wish to do so. 

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