Skip to navigation
Skip to main content
April 2012 Volume 19 Number 2
Japan: Migrants in Ag, IT, Health
There were 2.1 million registered foreigners in Japan in 2011. The four largest groups were Chinese, Koreans, Brazilians and Filipinos. The number of Chinese has been increasing, but the number of Brazilians has been falling since 2007-08.<< back
The March 11, 2011 earthquake and tsunami reduced Japanese GDP by almost four percent. Supply-chain disruptions lowered exports, while imports of oil and gas rose, generating Japan's first trade deficit in almost a half century.
Some 531,000 foreigners, almost a quarter of foreigners in Japan, left Japan in the month after the earthquake, with ethnic Japanese Brazilians and Koreans most likely to leave. Some began to trickle back in summer-fall 2011, but a year later there are still fewer foreigners in Japan than before the earthquake.
There are 930,000 foreign workers in Japan, including about 200,000 highly skilled foreign workers, 180,000 ethnic Japanese Brazilians, 110,000 foreign students working part time, 100,000 trainees, and 78,000 unauthorized foreigners. Some 10,000 unauthorized foreigners were regularized in individual proceedings over the past decade, receiving three-year renewable permits.
After 10 years of legal residence in Japan, foreigners can apply for permanent residence status.
Japan's population and labor force are shrinking. There are many consequences, including more labor market mismatches. Many graduates of secondary schools and colleges are unable to find career-type jobs and accept temporary contracts with mainstream employers or subcontractors to multinationals. Youth leaving rural areas, some of whom drop out of high school, sometimes go to work in urban areas for employers who provide them with housing, so that trying to change jobs requires finding new housing. Meanwhile, many jobs in mid-skilled occupations, including mechanics and construction crafts, remain unfilled.
Foreigners, because they are more mobile than Japanese workers occupationally and geographically, often provide the grease that reduces labor market mismatches. Japanese Brazilians may change employers, but trainees are tied to a particular Japanese employer. Almost two-thirds of the ethnic Japanese Brazilians in Japan are employed in manufacturing.
There are three major lessons of the March 2011 earthquake and tsunami for Japanese migration policy. First, the supply disruptions and out-migration increased the impetus to forge more free-trade agreements with trading partners, including China and Korea, in order to assure a free-flow of supplies. The shrinking and aging Japanese labor force combined with a strong yen is likely to encourage even smaller firms to consider shifting some production from Japan to other Asian countries, moving work abroad in part because Japanese policies make it difficult to bring foreign workers with middle and low skills into Japan.
Second, the 930,000 foreign workers who are two percent of workers complement Japanese workers. Ethnic Japanese Brazilians and Chinese trainees fill many jobs in small- and medium-sized manufacturing firms, while southeast Asian migrants are concentrated in construction and services. Ever-smaller cohorts of Japanese high-school graduates avoid middle-skill jobs in areas with shrinking populations and labor forces, disrupting production and economic recovery if migrants are unavailable.
Third, Japanese migration policies are bifurcating. Policy continues to welcome the skilled and minimize low-skilled foreign worker migration, although the result is often fewer high-skilled foreign workers then anticipated or desired. Local policies, on the other hand, often aim to integrate foreign residents and their children to maintain the populations and economies of shrinking areas. If enough local areas succeed in successfully integrating foreigners, opposition to low-skilled foreign immigration may be reduced.
Agriculture. Japan has a relatively small and declining agricultural sector. Some eight million people live on Japanese farms, but only a quarter of them, some 2.2 million, are engaged in farming more than they are in other activities. Of these so-called "commercial farmers," two-thirds are over 60, so the future of Japanese agriculture rests primarily on the 350,000 male farmers under 60.
Japanese farms get most of their labor from farm operators and family members. However, many farms also rely on trainees. Some 15,000 typically young Chinese sign three-year contracts to work-and-learn on Japanese farms. Until July 1, 2010, trainees had a one-year training period during which they were paid less than the minimum wage; trainees now receive at least the minimum wage after two months.
About three-fourths of Japanese farm sales are crops. Rice is farmed on about 55 percent of Japan's farm land, but rice is only about 20 percent of the value of Japanese farm output. Rice production has been declining, as paddy land is diverted to other crops, including fruits and vegetables, and some farm land is abandoned (the 2005 ag census reported that almost 10 percent of Japanese farm land was abandoned). Wheat, barley, and soybeans are grown for food, and corn is grown to feed dairy cows, hogs, beef cattle and chickens. Many growers of field crops contract out various phases of production, from plowing and planting to harvesting.
Fruit and vegetable production is concentrated on relatively large operations, that is, operations with 15 or more acres, including leased land. Foreign trainees are usually the responsibility of a "supervisory organization," often an agricultural cooperative, that assigns them to a particular farm. Most Japanese farmers have three or fewer foreign trainees.
Since there are fewer than 100,000 Japanese farmers under 40, and perhaps 15,000 foreign trainees, foreign trainees are an important share of the workforce in Japanese agriculture. Most trainees are employed in greenhouse operations and vegetable production.
Most Japanese agriculture is on four major islands: Honshu, Kyushu, Shikoku, and Hokkaido. The almost 1,000 trainees in Hokkaido in the north are mostly employed in dairies and greenhouses. The Kanto region around Tokyo on Honshu has over 7,000 trainees, mostly in vegetable farming. Further east on Honshu, the 3,400 trainees in Nagano are employed primarily in vegetables. Fruit, vegetable and greenhouse farming on Shikoku island involves 1,500 trainees, while the warmer Kyushu island has over 3,300 trainees in vegetables and greenhouses. In the Ibaraki area of Kanto, some farms have expanded by leasing land from elderly farmers who no longer farm, and these large farmers hire trainees and unauthorized workers. Trainees are fixed costs, since the farmer must pay them regardless of whether there is work, but most farmers would like to hire more trainees. Some farmers reported supplementing their trainee workforces with foreigners in Japan to work in other jobs, such as fish processing, paying them daily wages of 6,500 yen or about $75.
Trainees in Ibaraki earn 690 yen ($8.25) an hour for a 44-hour week. Farmers reported paying 190,000 yen a month, including taxes, while workers reported receiving 120,000 to 150,000 yen a month. Farmers provide housing for trainees, but charge them 20,000 yen a month for housing. Most trainees are not expecting to become farmers, but come to Japan to earn higher wages.
Integrating Chinese trainees is not a major issue since they come without families and are not allowed to prolong their stay. However, both the trainees and their Japanese employers express a desire to extend the maximum three-year period of stay in Japan.
IT. Japan has welcomed highly skilled foreigners since 1988 but attracted few, less than 200,000 in 2010. In 2001, the government announced a plan to accept 30,000 foreign IT workers by 2005, but did not achieve this goal. In 2008, the government announced a goal of 300,000 foreign students in 2020, more than doubling the current number.
A major change in 2012 is a point system to expedite the admission of highly skilled foreigners. Foreigners must achieve at least 70 points to gain admission, with 40 available for an annual income of at least 10 million yen ($80,000), 30 for a PhD and 20 for a Master's degree, and 20 for 10+ years of experience. Spouses of 70+ point foreigners can obtain work permits, and 70+ point immigrants can earn permanent residence rights after five years, down from the usual 10 years.
Japan's IT labor force includes almost a million workers or 1.5 percent of the Japanese workforce. Almost 43,000 of the 532,000 engineers in Japan in 2011, eight percent, were born outside the country, meaning that migrant engineers are a far higher share of the engineering workforce than foreigners are of the Japanese workforce. Over half of the foreign engineers were born in China, most graduated from Japanese universities, and two-thirds are in the greater Tokyo (Kanto) region.
As in the US, foreign-born engineers in Japan tend to be younger and lower paid than average. Over 90 percent were under 40 in 2011, and three-fourths earned less than $4,900 a month, slightly more than the $4,600 average for Japanese IT workers in their late 30s.
Japanese employers worry about the ability of foreign skilled workers to communicate in Japanese, high turnover, and difficulties assessing them. Many foreign graduates of Japanese universities prefer to return to their countries of origin rather than stay in Japan, reflecting the fact that Japan often ranks low on rankings of attractiveness to highly-skilled workers (Switzerland, Singapore, and the US rank highest). Almost half of the foreigners earning PhDs from Japanese universities plan to leave after graduation.
There may be Japan-specific factors that also discourage the employment of foreign engineers. Some studies suggest that skills acquired in Japan are not useful elsewhere, making an assignment in Japan a "career killer." Many of those employed in Japanese firms dislike the long hours expected and the limited social contacts with their Japanese colleagues. The families of foreigners often find it difficult to integrate in Japan, and Japan's social security system provides low benefits to those who contribute for less than 25 years.
Japan increasingly sees itself as competing with China for global talent. Chinese nationals are over half of the skilled foreigners in Japan, and Chinese government's policies to retain its "best and brightest" or attract them home may leave Japan with highly educated Chinese who cannot find jobs in China or other industrial countries, just as some Singaporeans complain that their talent policies attract second-best foreigners.
Health. Japan is a rapidly aging society with increasing health care needs. Japan spends about half as much of GDP on health care as the US (eight compared to 16 percent), but Japanese health care spending is rising for demographic reasons.
Japan has about 2,400 foreign doctors and 1,000 foreign dentists and pharmacists, under one percent of employment in these occupations. Most are in the urban areas, not in the rural areas that lack health care workers. The Japanese government talks of training more health care workers and delaying retirement rather than admitting foreign health care workers.
A major obstacle to an increase in the number of foreign health care workers is the requirement that all health care workers pass exams given in Japanese. Under Economic Partnership Agreements (EPAs) with Indonesia and the Philippines, and soon to come into force with Thailand and Vietnam, foreign nurses can be sponsored by Japanese health care institutions to work and learn in Japan. Experienced foreign nurses arrive on one-year contracts that can be extended twice, for three years, before they must pass a national exam given in Japanese to extend their stay another three years.
Upon arrival, foreign nurses must undergo at least six months of training at the expense of their host facility, and then be paid the same wages as Japanese nurses. This training and equal wages makes the foreign health care workers more expensive than Japanese workers.
Since 2008 from Indonesia, and since 2009 from the Philippines, nurses arrived in Japan under the EPA, but very few have been able to pass the Japanese exam. The Ministry of Foreign Affairs wants to open doors wider to foreign nurses, but the Ministry of Health, Labor and Welfare (MHLW), as well as the Japanese Nursing Association, does not see foreign nurses as key ingredients for meeting health-care staffing challenges.
Planning for immigration to provide health-care staff in Japan is made difficult by the MHLW's insistence that the solutions to health-care worker issues lie inside Japan. The government responded to the low-pass rate of foreign nurses in 2011 by allowing foreign nurses to stay a fourth year to pass the national exam, but is not considering any type of mutual recognition system that would allow foreign health-care workers to have their credentials recognized in Japan.
The health-care worker experience so far suggests that it may not be easy to introduce foreigners into the Japanese health-care system under EPS-style agreements. Furthermore, since foreigners receive the same wages as their Japanese co-workers, some can achieve savings targets in three years and may not want to stay in Japan after passing the national exam, so that Japanese host institutions would have to recruit, train, and employ another foreigner to replace them.
Papers presented at the conference, Migration and Competitiveness: Japan and the United States, are available at: http://migration.ucdavis.edu/rs/more.php?id=180_0_3_0