The Changing Face of Japan

Co-authored by:

David Wagner, Tokyo resident for 30 years, business content creator and advisor on media strategies.

Peter Douglas, Nozawa Onsen business owner and resident for 10 years (previously in Tokyo in late 1980s).

The workplace in Japan is changing rapidly.? Non-Japanese integration is everywhere. That's a huge positive for the future of the country.

We have reached this conclusion coming from different angles.? One of us lives in rural Japan.? The other calls Tokyo home.? Although roughly similar in age and both long-term residents of Japan, we do not necessarily see eye-to-eye on things.? We know this because whenever we meet, there are plenty of discussions segueing with “Yes, but” and “That’s not totally true” in our exchanges.

One thing we can definitely agree on is that the Japanese workplace retains very specific cultural characteristics. The importance of the group, soft and consensual decision making, an aversion to “winging it” versus intense and detailed planning and preparation, and the prevalence of hierarchy (both explicit and implicit) remain.? Having said that, a minority of Japanese - perhaps 20% of the workforce - are now in the “traditional” lifetime employment system that defined the post-war years, so by implication the majority of Japanese are in as fluid work and career environments as anybody else in the developed world.

Both the gig economy, and its grown-up cousin, entrepreneurialism, are on the rise amongst younger Japanese; the argument that Japanese are culturally unable to pursue capitalist risk aggressively is patently untrue.? Innovation is alive and well and the number of startups continues to grow.

Japan’s well-known demographic problem (too few births over a long period of time resulting in a dramatically ageing population) means that the workforce is currently under-supplied, and will continue to be for the foreseeable future. Not just younger, but also career-mobile Japanese, therefore have far more work and career options than in the past. Hourly wages have almost doubled over the last 10 years, and the increasing acceptance of job mobility allows salaried Japanese to raise their standard of living by changing jobs, as do employees in other developed countries. Along with these changes are revisions in the types and lengths of visas for non-Japanese workers with an eye better to accommodate skilled and remote workers.

All in all, the working environment today in Japan really does resemble that of many other nations.? It is no longer a peculiar outlier.? In particular, one of the most visible changes is the increase in non-Japanese workers.

The proportion of foreign-born employees in the Japanese labor force has approximately tripled to >3% in 10 years.? For example, in the cities it is now unexceptional to expect non-Japanese service staff in a convenience store, hotel, or?chain restaurant.? It is now even common to attend exhibitions and events where the majority of patrons originate from overseas. ?It is worth noting how ordinary Japanese do not appear to have been fazed by this dramatic change in such a short period of time.

As the foreign workforce increases from its current 3% to, let’s say, 10%, (i.e. - to a point where a meaningful proportion of most Japanese organizations include some foreign workers), how will Japanese companies, organizations, and society at large cope with this rapid and substantial cultural shift?

A pessimist would feel that this will cause untold social problems, as a significant portion of active society will not share the values, education, and innate social cohesion that characterize Japanese society.? The backlash could be ugly.

As evidence, note the pointed silence of elected officials about immigration; it's not a vote-winner. Yet as the labor shortage continues to impact everyday life in Japan, policy makers will surely be forced to take a more liberal immigration stance and the issue must at some point become a campaigning policy issue.

An optimist would of course be more positive. Peter runs a Japanese company that has an eclectic mix of local-local Japanese, variously internationalized Japanese, variously Japan-competent foreigners, and ‘nama-gaijin’ (i.e. – non-Japanese completely unfamiliar with Japan).? And it kind of works.

Japanese, generally, are team players, and if you're on the team, well, you're on the team.? Whether you're a socially dysfunctional Japanese or a Japan-clueless foreigner, the group works to ensure that all its members can contribute and are de minimis included.

Take the case of some of the “teams” in Nozawa Onsen that Peter is a member of:

• his company itself
• the residential neighborhood group
• local industry associations (three of them!)
• his same-age social group in the village

This gravitation towards inclusion of course implies exclusion - if you're not part of the group, you're excluded from it.? Inside and outside groups are nothing new in Japan. ?Yet assuming that most non-Japanese immigrants come here to work or to study, and will likely have personal interests (sport, etc.), they will more likely find themselves integrated by default, than universally excluded.

Another reason for optimism is language.? Back in the last era of internationalization (the late 1980s), Japanese-speaking foreigners were rare.?? Now, Japanese language skills are much more widespread, again facilitating integration.

Rightly or wrongly, migration to Japan is almost entirely economic, not political, and to work in Japan in anything other than a pure blue-collar job (for which visas are in short supply), you'll need language skills. ??Pre-COVID, more than a million folks per year took their JLPT language exams.? If you look around a typical JLPT exam room in rural Japan you'll see almost exclusively young Asians from India, Vietnam, Indonesia, etc... ?Most are not there out of a deep fascination with Japanese culture or an abstract love of language, but because they are looking to work in Japan.

Hence the overwhelming majority of migrants coming into the country have language skills and are members of the conventional workforce; some may be at the bottom of the economic pile but are unlikely to be ‘ghettoized’ or disgruntled.? While the weak yen may dilute the attraction of working in Japan somewhat, it's a safe country with excellent working conditions, and as a long-developed nation, offers skills and ideas aplenty to take home.?? It remains a very popular working destination.

Having said that, in many parts of the developed world, it's the second-generation immigrants that experience difficulties, and obviously, it's too early to tell what Japan's experience will be. ?Avoiding ghettoization will be a key part of a successful outcome.? Family integration helps; for example, in Nozawa Onsen’s local kindergarten, each year around 1/3 of the intake are mixed-race children. ?Mid-life identity crises aside, with at least one set of Japanese parents, second generation immigrants are significantly less likely to feel ostracized from the mainstream.

Finally, despite politicians' reticence, most Japanese we speak to are sanguine about the need for immigration.? They understand the demographic issues, the need for manpower, and are accepting the change in the society around them.? If immigration is generally smooth, Japanese will not oppose it.

If Japan does experience more of the problems that other countries have seen with immigration, attitudes may reverse.? But on balance, we feel Japan will manage its transition to a society accepting of immigration, relatively well.

December 2023