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Japan Inc scrambles for job-hoppers to cope with labor shortages

by

TOKYO Jul 06, 2017 - 12:00 am GMT+3
by Jul 06, 2017 12:00 am

Japan's labor shortage has pushed job-hopping to its highest since the global financial crisis, as companies scramble for workers with experience in the rapidly-ageing economy.

Job-hopping goes against the grain of Japan's work culture, where many companies hire graduates and employ them until they retire. But the country's jobs-for-life system is slowly giving way as firms curb labor costs and society shifts.

Switching jobs for better conditions is no longer taboo amid a tightening labor market, and the trend is being led by mid-career workers.

"There's always a risk of failure. But you can't get what you want if you don't try," said Hiromichi Itakura, 44, head of a medical job placement department at Saint Media Inc. in Tokyo, who changed jobs in January.

"I took up this job because it gives me a more responsible post. As a salary man, I also wanted a higher salary," he said, adding that his pay is now 20 percent higher than previously.

The number of job-hoppers rose for the seventh straight year to 3.06 million in 2016, the highest since 2009, though it still accounts for just 4.8 percent of the labor market.

Older workers have more opportunities because of demographics: a fast-ageing society, low birth rate and falling working-age population. The jobless rate has stood at a near two-decade low while the jobs-to-applicants ratio is at a 43-year high.

Big firms say the labor market is at its tightest since 1992, according to the Bank of Japan's latest "tankan" survey published this week.

Though job turnover is still low relative to other major economies - the change should be welcome news to Prime Minister Shinzo Abe, who has been championing labor flexibility and merit-based pay - with little success so far.

Companies facing labor shortages are willing to pay for battle-tested workers who don't need as much training.

Electric motor maker Nidec Corp is actively hiring mid-career engineers and remunerating them for their experience.

Job-hoppers aged between mid-40s and 65 or older are on the rise, hitting their highest, according to comparable data going back to 2002.

"The mid-career job market is booming," said Hirofumi Amano of en-japan inc, a job placement agency.

People older than 35 used to be considered past their prime in the mid-career market but these workers are now sought after. Companies are seeking experienced managers and engineers and offering higher pay, Amano said.

Workers who secured higher salaries from changing jobs outnumbered those whose paychecks shrank, labor ministry data from 2015 showed. A quarter of job-hoppers saw their salaries rise by 10 percent or more.

The rising mid-career job market reflects Japan's changing business climate and evolving attitudes about lifetime employment and seniority-based promotion, analysts say.

"Look what happens to even big firms like Toshiba, there's no guarantee for job security. Lifetime employment is something of the good old past," said Masae Miyachi, 41, of an IT venture company kaonavi, inc.

Miyachi changed jobs a year and half ago and her annual salary has now increased by 1 million yen ($8,857), helping her finance a home loan. "You need to carve out a career for yourself to earn stable income, and I'm doing just that by changing jobs."

Hiroaki Okutani, a 57-year-old contract worker at a logistics company Ueda Co Ltd, who left his job at a food processing firm two years ago, said his decision was partly due to anxiety about life after retirement.

About the author
Research Associate at Center for Islam and Global Affairs (CIGA) at Istanbul Sabahattin Zaim University
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