Why Recruiting is Hard(er) in Japan
Whether you are a startup or an established larger firm, identifying and securing the best talent is a challenge; this is true just about anywhere in the world and is particularly true now since many industries have undergone rapid change and the skills of the global labor force have yet to catch up. Yet, one often hears that recruiting in Japan is even more challenging that in other places, and these voices usually come from companies that have localized in Japan from overseas. In short, hiring here tends to be more challenging than in many countries and this is due to entrenched labor practices, cultural factors and the intertwined educational and corporate standards that are the norm here. And unfortunately, there is no short answer for a solution apart from creativity and perseverance.
Until recently labor practices in Japan have been quite different from what foreign companies are used to, and the residual effects of this result in a lower overall pool of potential job seekers. The practice of lifetime employment in Japan is generally well-known, and while 20 years of economic stagnation have done much to erode this institution, workers with permanent contracts will generally always have a strong sense of job security, regardless of performance. This reduces any sense of urgency employees may have to look for other opportunities. In addition, promoting from within, especially at the highest levels of the firm, is much more widespread in Japan than elsewhere, creating a disincentive for workers to switch jobs since the career-track related opportunity cost of leaving is higher. Strangely enough, I have been told by (Japanese) headhunters who place candidates primarily in middle management and below that most job changers accept positions with lower salaries, and often only leave after being at their old firm has become completely unbearable.
The other factor reducing the top of the recruiting funnel is culturally embedded risk aversion. From an anthropological standpoint, “Japan is one of the most uncertainty avoiding countries on earth”. This is the conclusion of Dutch social psychologist Geert Hofstede and describes “the way that a society deals with the fact that the future can never be known: should we try to control the future or just let it happen?” Obviously, “This ambiguity [of an unknown future] brings with it anxiety,” and the Japanese are not keen on ambiguity. For any worker, leaving his job brings a future that is inherently less predictable than the present and- even if he is dissatisfied with his current employment- this unpredictability is a deal breaker. For foreign companies, there is added risk since many Japanese perceive them to be ruthlessly profit-driven and therefore likely to easily let workers go during periodic downturns.
The smaller overall pool of potential hires is only half the problem, however. Even if the above issues did not exist, foreign companies would find it extremely difficult to identify and secure the type of talent they are looking for, due to the way that the Japanese education system and corporate culture have molded large parts of the general populace.
By global standards, the Japanese are very well educated. Scores in science, mathematics and levels of literacy are generally higher than the United States. University education is widespread and up to global standards. However, many of the skills and core values imparted by the Anglo-Saxon educational system- critical thinking, creativity and leadership- are absent. Educational success and evaluation are almost completely test-driven in Japan; all classes are “taught to the test” and what this means is a complete focus on brute memorization of facts and processes for scoring well on multiple choice tests. Class discussion is completely absent. The ability to analyze a body of work, form an opinion, and defend that opinion- through writing or speaking- is never developed. Critically, in subjects such as English, core communication skills are never developed since these can not be tested on paper, and it is not unusual to find high school English teachers who are unable to carry on a normal English conversation but can read and understand any English book cover to cover. Underlying this system is a strong sense of the absolute authority of the instructor and subservience of the student; the teacher and the content he delivers is unquestionable since the teacher writes the test.
This lack of core soft skills, absolute deference to authority, and faith in predetermined process continues and is reinforced once students graduate and enter the workforce. Talent continues to be developed in corporate settings much the same way as in school. First and foremost, employees are told- often to the letter- what to do in their jobs. This is understandable due to the absence of independent and critical thinking in employees’ lives to this point. Many corporate roles- from finance to marketing and beyond- come with extremely detailed “manuals” that employees can follow in order to do complete tasks. Since employees are always told what to do, Japanese corporations tend to develop generalists by frequently shuffling employees among divisions. The usual introduction a newly transferred employee gives to his colleges is “I don’t know anything about this job, so will be a nuance for awhile.” In other countries this kind of announcement would produce extreme uneasiness among colleagues, but in the average Japanese company the process of doing one’s job is largely already decided- anyone can learn to do it since the way to do it is already well-understood. Along with this faith in process, the cultural “way we do things around here”, while observable in companies worldwide, is even more authoritarian in Japan and stifles many creative solutions that employees may come up with.
A small, largely generalist talent pool reliant on infrequently-questioned process and short on creativity creates significant recruiting challenges, especially for startups. There are no shortcuts to overcome this, but there are some ways for foreign companies to get ahead. First, focus on sourcing talent from certain specific groups; for younger hires, this may be identifying Japanese graduates from foreign universities or Japanese university graduates who have spent significant time abroad during their educational years; these candidates have often learned the creative/critical and language skills that are sought after. Also, one advantage Japan has over the US is ease of procuring employment-related visas. This means that your search need not be limited to Japan, especially for roles that don’t require perfect Japanese fluency. Lastly, and most importantly, foreign companies should play up their differences form traditional Japanese firms in order to attract the type of candidates they are looking for. If my (admittedly heavy-handed) account of Japanese corporate culture sounds unappealing, then you are in luck since a significant subset of the Japanese workforce feels the same way. By positioning and marketing your Japanese office as an environment where debate, creativity and individual initiative are encouraged (generally not a problem for startups), you will appeal to exactly the kinds of employees you hope to attract. Their numbers may be smaller than in other countries, but once you do secure and nurture this talent, foreign companies will often find that their Japanese employees tend to be more loyal than their counterparts in other offices. In the end, there are advantages to recruiting here as well.
