4 must-knows for entering the Japanese market
Global pharmaceutical and healthcare organizations entering into Japan must ready themselves for a major recruitment headache.
Japan has a uniquely difficult hiring landscape, characterized by a significant supply and demand problem. With a very limited talent pool, recruiters must deepen their local understanding in an effort to stand out from the crowd and capture the attention of both active and passive candidates.
Here are 4 things you need to know about hiring in Japan:
1. Supply and demand problem
Japan boasts one of the world’s most intensely competitive labor markets. The significant issue of supply and demand stems from various factors, including a prevailing “job-for-life” ethos, low unemployment, an aging workforce, limited English language skills, and a preference for trusted Japanese legacy organizations.
Pharmaceutical companies entering into Japan can’t deploy the same recruitment strategies that have worked in other contexts. They must adapt to a market where excellent candidates have endless job offers. Simply posting job ads won’t suffice, companies need to be creative in order to attract top talent with such a small pool of candidates actively looking for new employment.
2. Job satisfaction is low
Over the years various international surveys have reported Japanese employees as being the most dissatisfied workers globally. This is generally blamed on long working hours, lack of autonomy, and work pressures. According to a survey from McKinsey in 2022, 31% of Japanese employees reported they experienced symptoms of burnout sometimes, often or always.
In 2016, the Japanese government began advocating for a work-style reform bill. This included suggestions to reduce overtime, introduce flexible working arrangements, and improve efficiency. This doesn’t appear to have had much of an impact on employee satisfaction, although the Covid-19 pandemic has sped up the transition to flexible or hybrid work opportunities.
This is an opportunity for new organizations entering the market, to present themselves as an employer of choice by demonstrating how they care for their employees and promote wellbeing and satisfaction.
3. Compliance candidates hard to find
Currently, there is a no shortage of compliance job openings across the pharmaceutical industry in Japan. While it might be one of the first hires you’d like to make as you enter a new market, it’s fast becoming an exceptionally challenging role to fill.
Many legal candidates are disinterested in compliance and don’t want to do it full time. A recent trend has seen some companies splitting compliance and legal, while others are introducing employee rotations, bringing in employees from finance or internal control to work in compliance temporarily. The danger of that approach is these rotating employees may quit to avoid working in compliance.
4. English skills in high demand
While the Japanese government has recognised that English skills are needed to operate in the modern economy, English speaking rates across Japan remain lower than most other Asian countries.
In 2019, Japan ranked 53 out of 100 non-English speaking countries for English language abilities. This places Japan in the ‘low English proficiency’ band.
This is bad news for international pharmaceutical companies entering the market, who require excellent English communication skills. Alongside other talent requirements, like high-level medical industry experience and cross-cultural understanding, the already small talent pool shrinks even further.
Recruiting in Japan is far from easy. In our experience, some positions may only have 28 qualified candidates across all of Japan. The success and failure of your organization depends on hiring the best talent.
At Morunda, we specialize in market entries and help outsiders become insiders. We leverage our combined 60 years experience being based in Japan to give you confidence in hiring and to find every qualified candidate. Book a discovery session to crack the code for hiring in Japan.