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Japan’s Aging Society – 4 Ways the HR Business Has Responded to Labor Shortage

Németh Vivien
Japanese business, Japanese HR

Japan’s aging society has been a hot topic for the past few decades due to the massive labor shortage occurring in most industries, whether it be service, manufacturing, agriculture, construction or healthcare. The country is still managing to make ends meet – but how? In this article, we are going to introduce 4 ways Japan’s HR business has responded to this problem in the past decade.

It’s necessary to understand the background of why these business practices were born in the first place, so let’s talk reasons and numbers.
What were the main factors that the HR industry had to adapt to?

Aging population, low birthrate

If someone mentions this expression, we can confidently say that Japan is what comes into people’s minds first, and unfortunately, that is no wonder. Based on the data collected by the Japanese Cabinet Office in 2020, elderly citizens made up 28.4% of the population in 2019, and this number is predicted to increase even more in the following decades. This is a phenomenon that can be observed in developed countries in general due to the progressing of industrial revolutions and the changes occurring in family structures. However, Japan’s aging can also be accounted for the following 2 factors:

  • declining number of deaths of citizens aged 65+ due to the improvement of life circumstances and medical practices after World War II
  • declining number of births. The current fertility rate is 1.42 births per woman (age 15-49).

Lack of physical labor

In order to respond to the problems mentioned above, Japan started working on both long-term and short-term counteracting measures.

  • In the long run, the country needs to find ways to increase birth rates.
  • For now, increasing participation rate of women and the elderly in labor make up for the lack of workforce – temporarily.

However, working circumstances such as hard physical work and working at odd hours (nights or very early mornings) can mainly be endured by younger people – which the country lacks at the moment. In the past 4 decades, the number of young workers (age 15-44) gradually decreased due to the declining birthrate, while the rest of the age groups have slowly become the majority.

Japan's aging society

Japan’s aging society – Changing of labor force age group structure in Japan (source: Chūshōkigyōchōhen 2018)

 

Japan's labor shortage

Japan’s labor shortage per industry in Japan (source: Chūshōkigyōchōhen 2018)

 

What HR business solutions were born in order to face labor shortage experienced all over Japan?

1. Sending organizations for „Specified Skilled Workers”

In recent years, Japan has opened its arms wide for foreign workforce to enter the country in order to make up for the lack of workforce in industries that are most struck by it. The country created a special type of visa in 2019 called the „Specific Skilled Worker” visa that foreign workers of certain professions who wish to live and work in Japan can apply for.

These 5 industries have been selected first to accept visa applications from skilled individuals for:

  • Construction
  • Shipbuilding and ship machinery
  • Accommodation
  • Nursing care
  • Agriculture

Later, the following 9 industries were also added to the target list:

  • Building cleaning management
  • Raw materials manufacturing
  • Machine parts and tooling
  • Electric, electronics and information technology
  • Automobile repair and maintenance
  • Aviation
  • Fishery and aquaculture
  • Food and beverage manufacturing
  • Food service

Since applying for the visa, getting to a certain level of Japanese proficiency in order to be able to take a language test and a skill test, and finding a sponsor company that provides employment can be difficult to do all alone from a foreign country, so called „sending organizations” (送り出し機関, okuridashi kikan) have been established in order to provide support for potential workers.
These agencies are particularly common in Southeast Asia, in countries like Vietnam, Indonesia or Cambodia, and have to be approved by the Japanese government. Their business model includes taking a certain commission fee from the Japanese companies that are seeking foreign employees with special skills, and also taking a representative fee on top of obligatory fees (such as the cost of a Japanese language exam, skill exam, paperwork, etc.) from the individuals who wish to work in Japan.

2. Employing the elderly – „Silver work”

As it was already mentioned before, the elderly (people aged 65+ in this context) make up almost one-third of the Japanese population. However, according to a recent survey conducted by Nippon Life Insurance Co., almost 64% of Japanese are willing to work even after reaching the age of retirement, which creates new opportunities to fill the gap labor shortage is causing on the market.

In recent years, certain organizations emerged in order to recruit and provide paid part-time work for retired-age citizens who wish to remain active and earn a bit of additional income. This not only helps dealing with the problem of workforce issues to a certain extent nation-wide, but also supports elderly people with staying motivated and social in their daily life. Recruited members of such an association can choose how much they want to work in a week freely, and may also try several different kind of jobs that they may have not challenged before, gaining new knowledge and skills.

Japanese elderly citizen working part-time in a park after retirement

3. Temporary staffing – „Haken”

Temporary staffing or personnel leasing (派遣, haken) is not a recently invented employment type in Japan. However, as labor shortage began to drastically worsen over the past decade, certain industries started relying more and more on the services of temporary staffing companies – the convenience store industry being one of them. Konbini chain owners are struggling with lack of staff to a point where they have to consider ending their 24/7 business policy because they don’t have enough employees to make ends meet in terms of managing shifts. Finding new employees always takes time and money – recruitment costs are one thing, but training a new staff member who has no working experience in a konbini and hoping they won’t quit too soon is another big issue.

In response, some convenience store franchises took solving this problem to a level where they co-established their own temporary staffing company in order to fulfil their specific needs in human resources. A great example for this would be one of the biggest convenience store chains, Lawson, which has its own haken company called Lawson Staff. Temporary staff members who are recruited to the company receive full paid training before being dispatched to stores struggling with empty shifts. Lawson Staff has even developed its own software so its employees are able to browse shifts freely based on their preferred location, working time, store, and many other conditions, which is creating more flexible opportunities for full-time and part-time temporary staff members.

New konbini employee during training

4. Gig work – „Tanpatsu/tanjitsu baito”

Gig work is not a fresh concept globally, but it is something quite new that only has been introduced to Japan through some innovative platforms in the past few years. Gig jobs, or “one shot/one day jobs” in Japanese (tanpatsu baito or tanjitsu baito, 単発バイト・単日バイト) can be done by anyone who has some time on their hands and a need for quick money.

There are several types of gig work, packing being one of them

3 examples for platforms specializing in one day work in Japan are Shotworks, Timee and Matchbox. All websites offer a variety of jobs in all kinds of industries: logistics (packing, packaging, driving), manufacturing (assembling parts), service (convenience store, restaurant or shop staff), office work (administration, filing, documenting, scanning), even agriculture, seasonally (picking) and many more. Gig jobs and temporary staffing jobs are both very popular among students, stay-at-home mothers, foreigners and “freeters” (フリーター, furiitaa: someone who prefers not having a regular full-time job and working whenever and whatever they want).

Japan’s labor shortage problem may result in even more hardships and challenges as population continues to decline in the following years, but luckily, new solutions available on the HR market are – and hopefully, will still be – able to offer a sense of relief to Japanese businesses in trouble.

 

Need some help with your own business?

We have been working together with our consultants and partners since 1999 towards creating more business opportunities between Japan and the CEE region.
If you are also looking to enter the Japanese or the CEE market with your organization, feel free to contact us for consultation by clicking here!

 

Sources

Averting disaster in Japan

Nagygyörgy Anna
Life in Japan

The fifth anniversary of 11 March 2011 and the earthquake that hit Tohuku, triggering a tsunami which brought disaster to the Fukushima nuclear power plant, has just gone by. This disaster counted as the worst since earthquakes were first measured, starting in 1900, and the destruction was tremendous.

Shindomap_2011-03-11_Tohoku_earthquake

Over 20 percent of all the earthquakes in the world are in Japan. Sometimes the tremors are accompanied by tsunamis that wreak havoc on their own. In addition, during the summer months, typhoons threaten people and the built environment alike. The Japanese are accustomed to natural disasters and begin teaching even very young children what to do to mitigate the consequences and protect themselves. Kindergartens have earthquake and fire drills every two weeks and school children have drills every few months. Children of all ages know the little poem made up of the first letters of the disaster instructions and called the O-Ka-Shi-Mo poem. The rules are O(Osanai)/Ka(Kakenai)/Shi(Shaberanai)/Mo(Modoranai). Don’t push! Don’t run! Don’t talk! Don’t go back! Continue reading…

That day, 5 years ago, was also a Friday…

Harada Chika
Life in Japan

It’s hard to believe that March 11, 2016 was the 5th anniversary of the Tohoku earthquake that hit Japan in 2011.

I clearly remember that tragic day. I had to go to the animal hospital that day and had my newborn daughter with me in her pram when I saw the news on the television in the waiting room. That was 5 years ago.

My own previous personal experience with an earthquake was in 1995, at the time of the huge Hanshin, otherwise known as the Kobe, earthquake.

At that time, even three days after the quake, the train running along the Hanshin line only went from Umeda to Koshien (a town between Osaka and Kobe) but since my uncle and his family lived further down the line in Ashia (which is closer to Kobe) my parents and I had to walk for two hours from the station to their house, to bring them groceries and drinking water. I’ll never forget the devastation and the heart-wrenching spectacle of people on the roadside carrying heavy bundles, and queuing up for water in places where all public utilities had ceased functioning.

In those days I had been working for a life insurance company. We had a huge number of clients or client relatives contacting us to report that the client or a family member had been killed in the disaster. Eighty percent of the earthquake fatalities were found inside their collapsed homes, buried under their furniture.

foldrenges Continue reading…

Behind the mask

Sebők Tünde
Japanese customs

Flu season – January and February are the usual time to catch a cold and get sick. It sounds like an impossible task to avoid catching some sort of virus in school, at work, while shopping, or in public transport, especially if someone sneezes or coughs right on us.

I was discussing this very issue with colleagues just a few days ago when I said that I missed the Japanese custom of wearing masks. That’s what gave me the idea for this article and I think many readers might like to know when this custom began in Japan (and in general in Asia).

Kép 1The story goes back to 1918/1919 when a global influenza epidemic (the Spanish flu), swept over the entire world, infecting 500 million people. The number of fatalities is estimated to have been somewhere between 50 million and 100 million. The virus made its way across every single continent, including Asia (it killed 5 percent of the population of India, for example) and sadly, Japan. People tried to protect themselves by covering their faces with scarves or veils or masks until the disease ran its course, ending in 1919. Continue reading…

Pictures at an Exhibition – Japanese inspirations

Biró Krisztina
Japanese art

While walking along the shores of Lake Zurich, my eyes fell on a poster with a Japanese theme: the Kunsthaus (Museum of Fine Arts) was advertising an exhibition called “Inspiration Japan – Monet, Gauguin, Van Gogh.” There was nothing surprising about my noticing this promotion, because ever since I’ve become interested in Japan I act like a magnet for any objects or items related to the Land of the Rising Sun, whether I happen to be in a small town in Hungary or a major city in Europe, and whether my stay is for business or pleasure. However, the moment I pulled out my camera to snap a picture of the poster, a strangely dressed woman pounced in front of the camera gesturing wildly – and acting completely out of place for a country as conservative and formal as Switzerland – telling me at length that I absolutely must go and see the exhibition and promising me a unique and fantastic experience. She also told me the hours when it was most worth visiting the collection, before the crowds coming by bus got there, to have the exhibition more or less to myself. I did as she suggested and went to see what it was about Japanese culture that so inspired the European artists and triggered the enthusiasm of the lady on the street.

inspiration japan plakat

Using the term “Japonisme,” the exhibition covered a timeframe ranging from 1860 to 1910 and presented a collection of Japanese works of art that found their way to Europe over this time, and how they inspired predominantly French artists to work along new lines. The Japanese art included the colored woodblock prints of Katsushika Hokusai (1760-1849) and Utagawa Hiroshige (1797-1858) (ukiyo-e) as well as porcelain vases and theatrical masks, along with the masterpieces by the European painters who worked in the latter half of the 19th century, in which I could see a measure of Japanese influence. For instance, Vincent Van Gogh painted a portrait of an acquaintance with a background of Japanese woodblock prints. Another of his paintings is of a geisha with a stern look on her face. Claude Monet painted his own garden at Giverny – which he designed using the Japanese garden as his model. It included a small pond with water lilies and a footbridge going over it. Henri Toulouse-Lautrec’s lithographs also reflect a Japanese influence in the two-dimensional figures with sharp outlines and typically Japanese color combinations. However, the closest influence can be seen in Pablo Picasso’s erotic drawings, which are modeled on the Japanese shunga (“Spring Pictures”) that offer aesthetic portrayals of everyday sexual pleasure. Continue reading…

How many toes does a dragon have?

Sűdy Zoltán
Japanese culture

Lifelong learning is the thing. I recently had dinner in a Tokyo restaurant with the owner and CEO of a Japanese IT firm, where I was asked the dragon toe question. And I have to admit that I hadn’t the faintest idea, even though the dragon is a dominant symbol in Japan (among other places). The dragon is the defender of Buddha and Buddhism and as such it is a near mandatory ceiling decoration for the primary buildings of Buddhist – particularly Zen Buddhist – temples. Below is the dragon that adorns the Tenryu-ji temple (Kyoto), a World Heritage Site. It is some 60 feet in diameter and was painted towards the end of the 19th century (Let me quickly warn you not to draw any far-reaching conclusions on dragon toes from the image because the correct answer is much more complicated.)

sarkany1

However, even before Buddhism was introduced to Japan, the dragon was a part of Japanese legend, and was included among the Shinto gods. Anyway, before going into detail, let me quickly compare the Japanese dragons with ours. Continue reading…

I grew up with Hayao Miyazaki

Petre Kinga
Japanese movies

One of the most important takeaways of my first visit to Japan was my discovery of Hayao Miyazaki’s films, which I fell in love with at first sight. That love has not diminished, although it has changed its focus somewhat. It has been quite a feat for Miyazaki to hold onto a place in my heart for well over a dozen years, even though I have changed a great deal in other respects. Many books and much of the music I adored back then are no longer among my favorites but Miyazaki’s animes are still firmly imbedded in my heart.

Of course, from time to time I’ve changed the ranking of my favorite tales and how often I watch them. Once I told a Japanese colleague that when I feel totally miserable I watch “Hauru” (Howl’s Moving Castle) and got the surprising and positive response of “Me, too!” I was honestly surprised and delighted with that reply and since then we regularly fire quotes from this and other Miyazaki films at one another.

Long ago, my first list of favorites was headed by “Nausicaä of the Valley of the Wind” and “Laputa: Castle in the Sky.” I still watch them, though rarely, and never to try to improve my mood. Instead, I prepare carefully and leave myself plenty of time to let my mind wander and contemplate the world. For me, these films are heavy stuff and require serious thinking. They are definitely not the “I-watch-them-any-time-I-feel-like-relaxing” variety.

naushika Continue reading…

A word or two about green tea

Sűdy Erika
Japanese food

First of all, I need to rectify two misunderstandings. Camellia sinensis comes from Southeast Asia and India. It is an evergreen tree that grows up to as much as 8-10 meters (25-30 feet) in height and has spreading branches. On tea plantations the height is kept down to 1-1.5 metres (3-5 feet) to make continuous picking of the fresh sprouts easier. This is why the plant is commonly called a bush. The other misunderstanding concerns the belief that green and black teas come from different plants. They do not. They come from the same genus, in which there are four species. The two that are the most widespread are Chinese and Assam. In essence, the shoots of these plants are plucked, and different processing methods are responsible for the differences in taste, bouquet, and color.

teacserje

Black tea is partially or completely fermented. Tea came to Europe from India during the era of colonialism. Various regions of India, including Assam, Darjeeling and Nilgiri, produce teas that differ because of the differing climates. Continue reading…

Mizuhiki – the art of tying paper cords

Rajzó-Kontor Kornélia
Japanese art

As Japanese culture becomes increasingly well known throughout the world, fewer people are surprised to learn that something thought merely to be a common practice is a separate art among the Japanese. While in principle anything can be turned into an art and given artistic value, there are very few places that actually do this.

mizuhiki

Image 1. A, B, C: Musubi-kiri, D, E: Musubi knots

Let’s take a look at knot tying. Obviously, tying a knot is not specific to Japan. Tying knots is an organic feature of our lives in general. And, of course, there are quite a number of points in our culture and in folk cultures in general where there are ribbons and cords, and the shaping of cords into knots. The most common examples are the knots used for fishing lines, sailboats, and mountain climbing, each of which has its own complex knotting techniques. A look at the arts leads us to folk art, where silk ribbons in the hair are an integral part of a costume. I was only 4 years old when I learned that there was a special way of tying the red or other colored ribbons in my hair when doing folk dances. And that is true to the nth degree when tying a ribbon on a bouquet of flowers or on a package containing a gift. Continue reading…

One person – two native languages

Bassa Zoltán
Japanese culture

Someone once told me that by the age of 6 months we understand everything that is said to us and we can even distinguish between the languages that we hear.

The human brain is capable of amazing things.

Here’s what happened when my daughter, whose mother is my Japanese wife, was about one year old. One evening my wife tried to read a Hungarian story to the toddler, who immediately stopped her. I then tried to read to her in Japanese, and she stopped me, too. She simply didn’t like it. Clearly she noticed that we weren’t reading as smoothly as we should have been, and we also have foreign accents in each other’s language. Since then, we both stick to our native languages when reading aloud. However, she is not as rigid as she used to be. She is now four, and may have realized that it is tougher to read a story in another language, so she’s become more understanding. In fact, she’ll stop us and ask for an explanation if she doesn’t understand a word. Continue reading…

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