Why is it so Difficult and Time Consuming to Hire in Japan?


Question - Branding in Asia Magazine“We have offices in Singapore, China, Hong Kong and Japan. Why is it so hard and time-consuming for our Japan office to recruit Talent?”


Answer - Branding in Asia MagazineThis is a common complaint I hear from hiring authorities outside of Japan. They look at their operations in Japan and wonder why hiring times are double or triple of those in their other markets and why the engagement from the market towards their role is so low.

Not that it’s any comfort, but you certainly are not alone in having trouble hiring talent in Japan. In fact, 83% of hiring managers in Japan report difficulty in filling jobs, making it the most difficult country to hire for as surveyed by ManpowerGroup in their latest Talent Shortage Survey 2015. The world average is 38%.

Relationships need to be built, curated and maintained. Hence, looking at better community building and talent-pools of “next-to-hires” is very important, but seldom utilized in Japan.


 

So why is it so difficult, even for those with mega-brand names to get talent?

Before giving a piece of your mind to the hiring teams in Japan about 35-40% recruiting fees, the lack of candidates to review and the extended amount of time a role has been open for, there are a few things to consider:

A highly centralized workforce

The vast majority of corporations in Japan operate out of Tokyo. Nearly all major global corporations have their HQ in Tokyo.  They are all looking for talent within the same 623 kilometer square metropolis that is the “special wards of Tokyo”.  Competition for the same pool of Talent is intense. This is especially the case for foreign companies operating in Japan that are all looking for the same “foreign company” experienced worker that has a level of bilingual skills and education/thinking that is outside of the norm for a domestic organization employee.

Risk aversion is a favorite sport in Japan

Japanese decision making is very much a collaborative approach.  Consensus is consistently sought on decisions to allow the distribution of responsibility. Therefore, the act of making a decision to change a job is a very individual one. And this is a hard ask for someone from Japan.


 

Low English levels in Japan

English levels are relatively low compared to other parts of the world. In fact, in 2014 Japanese was placed 30th of 60 countries in the third EF Education First  English Proficiency Index EPI.  But this number doesn’t reflect the fact that most testing doesn’t evaluate the Spoken level of English.  Spoken English in Japan is at a very low level.

 

Job candidates are passive  

We hear in the market now about the changing nature of recruiting. We now need to go and chase individuals and find those passive individuals for our roles.  Welcome to Japan!  The Japan market has always been a “candidate” market. The overwhelming percentage of candidates are passive.  They are inactive in exploring new roles and/or even accepting a call to be made aware of roles.  Applications to job boards for mid-level and executive level candidates is minuscule, compared with the market size. Linkedin as a platform highlights this case.  Out of a population of 127 Million people, only 1 million are on Linkedin. Compare that to the 115 million users in the USA out of a population of 318 million.

Competition for the same pool of Talent is intense. This is especially the case for foreign companies operating in Japan that are all looking for the same ‘foreign company’ experienced worker.

Relationships, relationships, relationships

Japanese are in no rush to build a relationship with others. They know the importance of cultivating bonds and mutual respect between parties.  Therefore, the mode of recruiting in short time frames and encouraging a speedy process is often incongruent with how the candidate wishes to proceed.  A speedy decision to hire the candidate may in fact be seen as a “red flag” and be off putting to a potential hire. Relationships need to be built, curated and maintained. Hence, looking at better community building and talent-pools of “next-to-hires” is very important, but seldom utilized in Japan.

Life-time employment is still very high

This phenomenon has been changing over the last 15 years or so, but it is still expected by many Japanese, that when they join a prestigious company, they will spend their life working for that organization.  Dragging someone out of a large domestic corporation to another company is a hugely emotional and disruptive process for many, and one they would simply wish to avoid.

The general cost of running a business (rent, taxes, etc) and Human Resources payroll is one of the highest in the world.  With costs, you will naturally see higher fees and operating costs that need to be covered by third party recruiting agents.


Do you have a question about hiring in Asia? You can send your questions about that or anything else to Tyron Giuliani at [email protected].

 

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