How to get a job in manufacturing, the manpower shortage & its challenges in Japan
According to a survey conducted by the Ministry of Economy, Trade and Industry (METI) in December 2017, over 94% of large and medium-sized enterprises (SMEs) in the manufacturing sector are experiencing a shortage of manpower. Of these companies, 32% said that their business was also thus affected, and the top industries for companies that gave this response were transport machinery, steel, non-ferrous metals and metal products. In particular, "skilled personnel" was singled out as a challenge especially in securing human resources, and it became clear that smaller companies were struggling more with manpower issues.
In this article, we will discuss the causes of the shortage in manpower within the manufacturing industry, what are some of the measures to address it, the challenges ahead and how you can get a job in manufacturing if you specialize within this industry.
Why is there a manpower shortage in the manufacturing industry?
Apart from a shrinking workforce in Japan, there are a number of industry-specific factors that have contributed to this shortage of manpower in Japan's manufacturing sector, which we will cover below. In addition, the mobility of the workforce has made it difficult to pass on skills using the traditional "learn by watching" method, which has also greatly contributed to the shortage of manpower.
- Negative image of the manufacturing industry
The negative image of the manufacturing industry – "hard", "dirty" and "dangerous" – has yet to be eradicated. This is one of the reasons why there is a shortage of talent in the industry, both in terms of talent flow from other sectors and the lack of digital natives as the manufacturing industry evolves.
However, there are signs of change, albeit slowly, with companies embracing digital transformation and automation to reverse the traditional negative image, as well as an increasing number of companies switching towards more environmentally friendly business models in line with UN’s Sustainable Development Goals (SDGs).
- Failure of generational change and lack of successors
One of the traditional ways of passing on skills in Japan is known as On-the-Job Training (OJT). OJT is an occupational training method that involves practical work based on the idea of "showing by doing". However, this approach has led to a number of issues. Apart from the fact that it takes around 10 years of work experience for employees to move into procurement, development or design departments, which have often led to people leaving for companies and industries with better conditions, mass retirements have also led to delay in OJT which ultimately results in a shortage of manpower within manufacturing.
According to Monozukuri White Paper, 42% of both large and small companies said they faced a "shortage of manpower" when asked about the business challenges faced by manufacturing companies, while 17.1% of large companies and 22.7% of small and medium companies cited a "shortage of successors" as a business challenge. According to a survey conducted by the Ministry of Economy, Trade and Industry (METI), about half of the companies whose managers will exceed the average age of retirement in the four years to 2025 have yet to decide on a successor. This applies not only to management, but also to the skilled workforce. It is therefore extremely essential to recruit new and younger professionals to learn these new skills required.
How to solve this manpower shortage in the manufacturing sector and the challenges ahead?
The manufacturing industry is facing a serious shortage of manpower. As such, manufacturing companies have actually started taking action to resolve these challenges. Below are some examples of how and what can be done to reduce the labor shortage in the manufacturing sector.
Improving working benefits and reviewing their working environment is key to reducing employee turnover, retaining employees and thereby increasing rates of recruitment.
- Improve working benefits
In terms of working conditions, apart from offering a competitive remuneration package, some other benefits could include:
- Support for acquisition of qualifications (this can be especially useful for the organization if you’re supporting your employees in manufacturing-related certifications)
- English language learning support system
- Rent subsidy system
- Pet Accompaniment Scheme
- Congratulation and condolence money for pets
- Flexible career leave system
- Free snack service system
- Annual MVP system
There are many companies that have unique systems in place. Improving your employees’ benefits is essential for attracting and retaining the right talent. These have been especially successful for small and medium-sized companies who have tried to recruit through these improvements mentioned above.
- Reviewing your working environment
In addition to the improvement of employees’ benefits, it is also important to create a safe and healthy working environment for employees in order to reduce turnover and retain staff.
Specifically, the workplace environment should meet the following but not limited to:
- Are there adequate infection control measures in place, such as for new coronavirus infections?
- Do you offer a remote working environment? (Although this may only be applicable to certain functions within manufacturing)
- Are there training and development opportunities for career progression?
- Does the company manage customers' and employees' information with confidentiality?
- Are there any illegal working hours for employees?
By creating a safe and healthy working environment for your employees, you aim to reduce turnover and recruit the right people.
- Be open to recruiting
The working-age population in Japan is between the ages of 15 and 64, and until now recruitment and the use of human resources within manufacturing have been particularly focused on men. In order to solve the manpower shortage in the manufacturing industry, it is also important to be open towards recruiting. This includes a more diverse population including women, people with disabilities and senior citizens. The active recruitment of female members of society as well as knowledgeable and experienced seniors can add diversity to a company's culture and may also help to resolve some of your business problems.
Depending on the nature of the work, some personnel does not have to be able-bodied. There are many people with disabilities who excel in a wide range of fields, and it is possible to recruit people with specialist skills that your company is looking for.
This is also a great way for companies to contribute to society by actively recruiting a diverse group of individuals and can help to improve their PR and branding.
- Actively recruit foreign nationals
The Ministry of Economy, Trade and Industry (METI) has published guidelines on the acceptance of new foreign human resources, and the number of businesses employing foreign nationals have been increasing every year. Although the number of people entering Japan is currently in a state of drastic decline due to the effects of the new coronavirus infection, the number of foreign residents in Japan has been increasing each year. The United Nations estimates that the world's population is expected to increase by 2 billion over the next 30 years, and many foreign workers are expected to either stay or enter Japan.
At Progressive Recruitment, we specialize in supporting the recruitment of skilled talent and work with a global network of candidates with a unified database of over a million candidates. This includes both local native Japanese as well as foreign nationals, which means that we are able to support your recruitment needs both inside and outside of Japan. If the region you are looking to recruit in is not covered by our Japan office, we can put you in touch with the most appropriate Progressive Recruitment overseas office. If you are interested in working with us, please feel free to contact us using the form below.
- Proactive use of AI and ICT
The use of AI (Artificial Intelligence) and ICT (Information and Communication Technology) can improve productivity and operational efficiency, as well as reduce the cost of training employees and therefore eliminate the dependency of the workforce. Examples include the use of industrial robots for line work, the creation of databases and manuals for skills and know-hows, and the outsourcing of administrative tasks to companies with strengths in AI and ICT.
The use of AI and ICT also requires the training and acquisition of personnel with specialist knowledge of AI and industrial machinery. However, the cost of installing equipment and machinery can be quite costly, so it is important to balance this with your budget.
- Investment in staff development
Another way to compensate for a shortage of staff is to increase productivity per employee. This can be achieved by investing in training to improve the skills of your current employees, for example by ensuring that they are trained in the latest technology. This may seem like a long way to go, but in the medium to long term it can lead to an overwhelming increase in productivity.
- Improving your image through media exposure
As mentioned above, the negative image of manufacturing as a 3K (hard, dirty and dangerous) industry is a major reason for the shortage of manpower in the sector. By gaining exposure in the media, you can help to dispel this negative image and effectively promote your company's appeal. The following are some ways you could use the media:
- Launching paid media campaigns
- Place commercial and web advertising
- Actively promoting your business on social networking sites
- Web media coverage
However, media exposure is only a strategy to improve your image and is only suitable if you want to achieve long-term results. If you are looking to recruit more directly and in the short run, it may be more appropriate to prioritize methods that deliver results quickly.
- Use of outsourcing through a contracting model
Due to the nature of some manufacturing businesses, companies may find themselves struggling to justify the cost of recruitment as there are busy but also lull periods. Many companies also find that they are unable to afford the training and development of their employees due to high costs. In such cases, outsourcing these projects to skilled professionals to handle these tasks can be a flexible way to address staffing issues. You could hire skilled freelancers to work on your projects which will also provide an opportunity for your employees to learn from them. Alternatively, you could also outsource non-skilled tasks such as clerical work that can be done remotely so that companies can focus their resources on technology-based hires and roles.
- Using a recruitment agency
If you are looking to recruit quickly, a recruitment agency is often your fastest and most efficient solution. Progressive Recruitment has a presence in 15 countries and has been around for more than 20 years. As a specialist within the energy, automotive, mechanical, robotics, electronics and electrical manufacturing sectors, we’ve been partnering with organizations who may be looking to expand their business in Japan as well as advise companies on their talent and recruitment strategy. More importantly, we are able to source and find the right fit for your organization, saving you time and the hassle of finding someone unsuitable. If you would like to discuss your requirements whether you’re looking for global talent, bilingual talent or Japanese native, please feel free to contact us using the form below.
How to find a job in manufacturing?
If you’re a professional interested to move into the manufacturing sector, you may click the button below to see a list of our latest vacancies. If you’re unsure about entering the industry but would like to find out more about how you can grow your career, feel free to fill-up the form below and a dedicated specialist consultant will be in touch to help you.