The Journal The Authority on Global Business in Japan

Japan rightly has a reputation for developing hard-working, diligent, and capable staff, but the jobs market here has evolved over the past decade. Is a new generation of employees seeking more than simply a paycheck? Do they really care about being happy in their jobs as well as paid appropriately for their skills and knowledge?

Many of these young Japanese have studied or worked abroad and they like what they saw in terms of work–life balance, diversity and inclusion (D&I) in the workplace, and corporate social responsibility (CSR). They now expect such things here, and foreign nationals also bring these requirements with them when they arrive in Japan.

The onus, therefore, is increasingly on companies to create a culture that is conducive to this generation.

The vast majority of interna­tion­­ally minded companies have absolutely no qualms about doing so. The challenge has been to acquire and retain the best staff at a time when Japan faces a shortage of labor—a problem that will only worsen in the fore­seeable future.

LEGALLY SPEAKING
Japan’s demographic challenges can also be felt in the legal sector, says Isaac Uchiyama, senior business development manager for Allen & Overy, although there has been significantly less of a shift in job candidates’ requirements before accepting an offer.

“As an international law firm in Tokyo, where our employees are a mix of Westerners and locals, we have not really seen any noticeable change in candidates’ priorities,” he said. “We recruit from both abroad and from within Japan, across a spectrum of roles. For experienced workers, salary is likely to be more of a determinant than it is for new graduates.

“And, while candidates may be more aware of issues such as CSR and D&I, in recent interviews none of these issues have actually been raised.

“I think most job-seekers would raise those issues as an after­thought, once they’re employed,” he said. “At the interview stage, they need to sound gung-ho, willing to do whatever it takes to help the company succeed and to demonstrate that they will be a team player.”

READY FOR CHANGE
According to the Ministry of Internal Affairs and Commu­nica­­tions, Japan’s unemployment rate fell in May to its lowest level in 25 years, standing at a mere 2.2 percent—down from 2.5 percent in April. Additional data from the Ministry of Health, Labour and Welfare shows that job availability has risen to the highest level in more than 44 years, meaning that there are now 160 openings for every 100 people seeking employment.

The figures suggest that companies are aware of the looming labor shortage and, with economic conditions generally positive, are actively seeking to boost payroll figures to avoid being left shorthanded.

“Global and cross-border business has recently accelerated even further in Japan, alongside advances in globalization and technology,” said David Swan, managing director of recruiter Robert Walters Japan. “As a result, many companies in a wide range of industries have been in greater need of professionals who are both familiar with global business and proficient in a second language, putting the level of demand for bilingual specialists at an all-time high.

“Companies’ ability to secure talented bilingual profession­als with specialized skills and abundant experience is beginning to affect corporate futures,” he emphasized.

The emergence of cutting-edge information technologies, such as fintech, healthcare tech, and human resources tech, has created new jobs but also placed additional strain on the supply of individuals with the necessary skills, Swan said. Similarly, the need for IT security in the run-up to the Tokyo 2020 Olympic and Paralympic Games is further squeezing availability.

Coupled with this, employers and agencies are reporting an increased willingness among professionals aged 35 and above to change jobs—something that was virtually unheard of a decade or so ago.

 

SHIFTING PRIORITIES
Japan is currently a job-rich, candidate-short market for some skill areas, and the requirements on both sides of the equation are changing.

“There is a shortage in highly technically skilled areas, such as enterprise resource planning consultants, or in new technology-based areas, such as business intelligence or Big Data analysis,” one Tokyo-based recruitment expert told The ACCJ Journal. “Plus, confident, English-speaking native Japanese candidates are always in high demand for client-facing positions and often obtain better benefits than their counterparts with less seasoned English abilities.”

And while there still appears to be resistance on the part of potential employees to negotiate strongly for better terms, there has been a shift in their priorities.

Although salary is still important, in the last year top-tier companies have begun to reevaluate their work–life balance policies to offer flexible working hours together with the option to work remotely and take more annual leave.

The ability to enhance skills and career prospects is now the primary concern of many job seekers. This is followed by salary, office environment and location, company brand image, and company culture.

Those priorities are supported by the Robert Walters Japan Employee Insights Survey 2018, in which 66 percent of the 1,958 bilingual professionals at both foreign-affiliated companies and globally expanding Japanese companies put job content as the most important factor when choosing where to work.

Salary was the second-most important consideration, followed by work location, corporate culture, interpersonal relationships, and overtime.

Tatsuya Ichiyanagi, HR director for Chicago-based research-driven biopharmaceutical company AbbVie GK, said candidates’ values and preferences when choosing a company have become far more diverse.

“The pharmaceutical industry has gone through drastic changes over the past several years, which have impacted the talent market. We have been proactively addressing these changes to respond to the different needs of employees and future talent by listening to their voices and building an open and strong culture so that we can be the company of choice.”

ADAPT AND ATTRACT
This change in priorities among job-seekers and staff means companies such as biopharmaceutical company AbbVie GK must alter their profile and perception.

“Meeting a candidate’s needs is one thing, but arguably more important is how we communicate with the stakeholders,” Ichiyanagi said. “This is where corporate commun­ications and branding come into play, to build a strong corporate reputation by raising a company’s exposure and delivering the right message to the right market.

“And, in this ever-changing market and environment, companies always need to evolve to transform change into opportu­nities that meet the diversified needs of stake­holders,” she said. “And more diversity, innovation, creativity, and a sense of urgency are now required in management and employee circles.”

Maki Morino, a spokeswoman for Coca- Cola (Japan) Co., Ltd., said the drinks giant has a proactive policy to attract the most capable individuals and ensure that they are happy in their careers.

“To attract the best talent, Coca-Cola in Japan is creating and implementing HR policies that support a positive workplace by implementing diverse and flexible working styles, as well as telecommuting, paternity leave, and flexible working hours,” she said. “The focus is on working smarter, helping employees flourish in the company, and supporting them in their professional working lives.”

A critical component of that is diversity, she added, and the company has a 50/50 target to ensure a diverse slate. This includes those conducting interviews.

“For example, we want female candidates to meet with female interviewers. It is important to continue to send the message of diversity. It’s not just about the process, but about really making sure that our leaders and hiring managers understand the importance of a diverse view, because we can understand the market better and it’s the right thing to do.”

One of the most recent innovations is Millennial Voices, a group of associates born between the early 1980s and the early 2000s. The purpose of the group is to deliver distinctive perspectives and to gain a different understanding of the company—and the various people within it—by giving these younger team members a voice.

“Coca-Cola wants to be, globally, as inclusive and diverse as its brands, un­leashing the power within its employees to drive innovation and sustainable system growth,” Morino added.

Salary is still important to employees, said Yuri Ishiguro, a spokesperson for McDonald’s (Company) Japan, Ltd., although the fast-food giant has noticed a change in attitude among applicants in recent years.

“Salary is still important, but it appears there is a stronger focus on ‘a good place to work,’ the culture of the organization, and CSR activities than in the past.” she said.

“In particular, there has been an increase in people who want to focus on achieving a work–life balance, such as workplaces that encourage staff to take paid leave and enable flexible working styles.

McDonald’s Japan is proactive in creating a positive work environment for its staff, Ishiguro said, and regularly conducts surveys to determine the changing needs of staff.

“We believe that the foundation of our business is that it is a people business,” she added. “Our staff engage with 1.4 billion customers who visit us every year and make them feel special. It is, therefore, essential to hire talented people who can embody our brand and to encourage their growth.”

Japanese companies are generally not on a par with their Western counterparts when it comes to setting initiatives to drive CSR and D&I beyond what the government effectively requires them to do, said Uchiyama, although there seems to have been a slight change in attitude around maternity and paternity leave, which are tied to work–life balance.

“As a recruitment tool, you would think that employers would do well to boast about their CSR, D&I initiatives, work–life balance, and so on. But, my opinion is that most Japanese candidates—whether young or old—aren’t necessarily attracted by the first two, although they are, perhaps, by the latter work–life balance bit.

“They still expect to work like a dog when entering a new company,” he said. “It is in part tied to the ethos of Japanese society, and it’s ingrained in their logic from primary school that you work and live for the collective. The best strategy to attract talent in Japan is to offer good pay, the promise of work–life balance, and a clear path for career progression.”

But, it does not have to stay that way, he insists, and it is in the hands of employers to bring about positive change.

“Employers have an opportunity to influence their staff to get more involved in really good causes,” he said. “The employer’s influence is huge, because workers spend the majority of their waking hours on site and need to have opportunities—even throughout their work day—to make positive impacts on society and the world at large.

“I think that more Japanese companies should adopt measures to proactively engage their employees in CSR, because that would lead to greater job satisfaction and build company spirit,” he said.

“As an employer, you want skill, smarts, and the right personality. It is even better if you hire and keep someone who has all three, plus a selfless streak aimed at serving others or good causes without benefit to their own career progression,” he added. “At the end of the day, the employees represent the company, and it’s also good PR to be known as a company that is CSR minded.”

Julian Ryall is Japan correspondent for The Daily Telegraph.
More diversity, innovation, creativity, a sense of urgency are now required in management and employee circles.