Blogs and Articles from Third Way Forum Membrs
Feb 2, 2023
Discussion#3 How can we make foreigners want to stay and work in Japan long-term, and how can we make the Japanese want to go more global?
Blogs from The Third Way Working Group
- As compared with other major countries in the world, the cost of living in Japan is cheap.
- Especially for efficient purchasers who understand where to shop, Japan could be incredibly cheap.
- Unlike some countries, there is no food desert in Japan. Even outside metropolitan areas and in the countryside, you can still find a wide range of options of food, clothes and pretty much everything.
- The major challenge is of course the low wage level in Japan. However, if you are an expat, your quality of life could be still pretty high in Japan. Recently Uniqlo and some other Japanese companies have raised the compensation level for their employees. Also, some globally operating Japanese companies are putting the Japanese and foreigners both on the globally standardized salary model so that there will be no unhealthy pay gap between the local staff and the expats. We believe it’s a very positive trend.
- Having said that, however, the language barrier and the rigid culture remain as the major obstacles for foreigners. Many things are simply a way too complicated for foreigners (and for the Japanese as well) in Japan, even to do basic things such as opening a bank account, registration of any kind, starting your own business etc. Ease of doing things in a daily life is much less in Japan as compared with other countries.
- For foreigners, it is one thing to come to Japan on an expat assignment for a few years but it is a totally different thing to be localized on a local package for a long-term stay. It is a big decision and a big commitment with huge risks. The conversion rate from expats to local assignments must be much less in Japan as compared with Singapore or HK etc.
- The essential issue is that Japan is dead-end for most foreign professionals due to the below reasons:
> Wages (if put on the local salary grades) are low and salary increase is so slow and minimal
> Career opportunities upward is limited as Japan is not a regional HQ for most global companies and Japanese company HQs are all so top heavy with so many old long-timers blocking younger generation’s career path upward.
> Skill-set you can acquire(whether it’s a technical skill or communication skills ) in Japan are often Japan-specific skills and not transferrable outside Japan. Unless you plan to work in Japan for a very long time, even if you can do many things which are relevant “only in Japan”, it’s not worth investing your time and energy.
- There are globally motivated people and locally motivated people. International business hubs such as NY, London, Singapore etc have most people as globally motivated people while Japan has the majority of people as locally motivated.
- How can Japan become more competitive as an international business hub and compete with other global cities over talent? One concrete suggestion would be to create a totally separate international cosmopolitan district in Japan, where things are all conducted in English and everything is based on global standards and practices. Can we establish a “New Dejima” for future Japan?
- When we think of the will/skill metrics, probably most Japanese people are lacking both the will and the skill to globalize the Japanese society as a whole. However, even so they probably don’t mind there is a special district like Dejima where everything is no longer Japanese! It’s like Disneyland and Universal Studio. In fact, they would love it! Who knows, maybe someday in the future, so many Japanese want to come and work in New Dejima and eventually the New Dejima practices may be adapted by most Japanese companies. Then Japanese companies will be transformed as global competitive companies. Probably Dejima is the necessary step to expedite Japan’s globalization efforts.
- Especially for efficient purchasers who understand where to shop, Japan could be incredibly cheap.
- Unlike some countries, there is no food desert in Japan. Even outside metropolitan areas and in the countryside, you can still find a wide range of options of food, clothes and pretty much everything.
- The major challenge is of course the low wage level in Japan. However, if you are an expat, your quality of life could be still pretty high in Japan. Recently Uniqlo and some other Japanese companies have raised the compensation level for their employees. Also, some globally operating Japanese companies are putting the Japanese and foreigners both on the globally standardized salary model so that there will be no unhealthy pay gap between the local staff and the expats. We believe it’s a very positive trend.
- Having said that, however, the language barrier and the rigid culture remain as the major obstacles for foreigners. Many things are simply a way too complicated for foreigners (and for the Japanese as well) in Japan, even to do basic things such as opening a bank account, registration of any kind, starting your own business etc. Ease of doing things in a daily life is much less in Japan as compared with other countries.
- For foreigners, it is one thing to come to Japan on an expat assignment for a few years but it is a totally different thing to be localized on a local package for a long-term stay. It is a big decision and a big commitment with huge risks. The conversion rate from expats to local assignments must be much less in Japan as compared with Singapore or HK etc.
- The essential issue is that Japan is dead-end for most foreign professionals due to the below reasons:
> Wages (if put on the local salary grades) are low and salary increase is so slow and minimal
> Career opportunities upward is limited as Japan is not a regional HQ for most global companies and Japanese company HQs are all so top heavy with so many old long-timers blocking younger generation’s career path upward.
> Skill-set you can acquire(whether it’s a technical skill or communication skills ) in Japan are often Japan-specific skills and not transferrable outside Japan. Unless you plan to work in Japan for a very long time, even if you can do many things which are relevant “only in Japan”, it’s not worth investing your time and energy.
- There are globally motivated people and locally motivated people. International business hubs such as NY, London, Singapore etc have most people as globally motivated people while Japan has the majority of people as locally motivated.
- How can Japan become more competitive as an international business hub and compete with other global cities over talent? One concrete suggestion would be to create a totally separate international cosmopolitan district in Japan, where things are all conducted in English and everything is based on global standards and practices. Can we establish a “New Dejima” for future Japan?
- When we think of the will/skill metrics, probably most Japanese people are lacking both the will and the skill to globalize the Japanese society as a whole. However, even so they probably don’t mind there is a special district like Dejima where everything is no longer Japanese! It’s like Disneyland and Universal Studio. In fact, they would love it! Who knows, maybe someday in the future, so many Japanese want to come and work in New Dejima and eventually the New Dejima practices may be adapted by most Japanese companies. Then Japanese companies will be transformed as global competitive companies. Probably Dejima is the necessary step to expedite Japan’s globalization efforts.
Sponsor
