As the world’s third largest economy, Japan is a global leader in a number of key industries, including the consumer electronics, automotive and finance industries but Japan’s recruitment market also struggles to cope with both a brain drain of highly skilled professionals (who go and work for faster growing companies in neighboring economies) as well as a lack of local talent that is both globalized and fluent in multiple languages.
The Japanese Diaspora and Japanese Returnees
Japanese Brazilians are actually the largest ethnic Japanese Diaspora community outside of Japan numbering about 1.5 million strong with São Paulo being the largest concentration of Japanese outside the country. Brazil is then followed by the United States where the Japanese Diaspora is estimated to number 1.2 million and by the UK where at least 100,000 Japanese live.
Individual members of the Japanese Diaspora who have permanently settled outside of Japan are known as Nikkei with the Association of Nikkei and Japanese Abroad acting as a bridge between them and Japan. In addition, the Association of Nikkei and Japanese Abroad also hosts the annual Convention of Nikkei & Japanese Abroad.
In the 1980s when Japan faced a shortage of workers for jobs that were perceived as being “difficult, dirty or dangerous,” it actively recruited Japanese Brazilians and other Japanese from Latin America to come and work in Japan. In fact, an estimated 300,000 Japanese South Americans moved to Japan to work. However, the 2009 economic downturn caused the Japanese government to institute a program where unemployed Japanese from Latin America were paid to return home to their country of origin.
On the other hand, it’s worth noting that Japan is also facing a brain drain as highly skilled Japanese workers such as engineers relocate to Taiwan, South Korea and China in order to work for more aggressive and faster growing companies that prize Japanese technological expertise. Japanese academics and scientists have also tended to migrate and settle permanently in the US and other countries.
Finally, the number of Japanese students studying abroad has also been decreasing since it peaked at 82,945 in 2004. In fact and in 2009, the number had dropped to 59,923 with the number of Japanese students studying in the United States having fallen to 24,842 – half of the total of 46,872 reported in 1999.
The Japan Recruitment Market
While Japan’s economic malaise and problems with unemployment since the bubble burst in the late 1980s and early 1990s is well known, Japan has actually kept pace with economic growth in both the United States and the European Union (EU). Hence, Japan’s recruitment market remains active – especially for anyone who attended highly regarded universities, have unique technical skills and for locals and returnees alike with foreign language skills. In particular, there is active and growing demand for bilingual job candidates for positions at all levels ranging from executive assistants and office administrators to more skilled or senior level roles at foreign and local Japanese multinationals alike.
Likewise, there are opportunities for foreign expatriates in Japan – especially for those with particular technical skills or Japanese language abilities.
Working in Japan
In order to obtain a Japanese work permit or a long-term stay visa (good for either 1 year or 3 years), a foreign expatriate will need to first obtain a Certificate of Eligibility issued by a regional immigration authority under the jurisdiction of the Ministry of Justice. Once a foreign expatriate possess this certificate (good for 3 months), it will be much easier to get a visa at a Japanese embassy or consulate within the standard processing period – usually just five working days. On the other hand and without the Certificate of Eligibility, it might take as long as several months to obtain a proper Japanese visa. For the most up-to-date information about how to obtain a Japanese work permit or a Japanese visa, visit the Ministry of Foreign Affairs of Japan website.
As for Japanese income taxes, foreign expatriates and returnees alike should be aware that Japanese taxes are complex, range from 0% to 40% and can reach as high as 50% when municipal and other taxes are included. In addition, non-resident taxpayers (those living in Japan for up to 12 months) are taxed only on their Japanese source income while non-permanent resident taxpayers (those living in Japan from 12 months to 60 months) are taxed on both Japanese sourced income and any part of their non-Japan source income that is paid in and/or remitted to Japan. A permanent resident taxpayer (someone living in Japan for more than 60 months) will be taxed on worldwide income. For further information about Japanese tax rates or Japan’s taxes in general, visit taxrates.cc, KPMG’s Taxation of International Executives page for Japan or the website of the National Tax Agency of Japan (which also includes an income tax guide for foreigners in Japan).
Finally, it’s worth noting that working in Japan can be difficult for foreign expatriates and Japanese returnees alike but the country is slowly evolving. For starters, there is the legendary Japanese work ethic which means that employees are expected to put in long working hours both inside the office as well as outside the office through socializing with colleagues or business partners. And while the Japanese work culture may be more relaxed at some companies, the work culture at many other companies remains more tradition bound.
Likewise and while the older Japanese generation tends to be more consensus oriented, the younger generation is becoming more individualistic. In other words, western MNCs or even local companies who have adopted at least some western business and hiring practices may have an advantage in the Japanese recruitment market – especially when it comes to recruiting highly skilled and bilingual Japanese returnees.