The number of foreign workers in Japan has seen significant growth in recent years, surpassing 2 million as of October 2023, according to data from the Ministry of Health, Labor, and Welfare. To address this rising trend, Japan’s legislature introduced major reforms in June 2023 to two key programs that allow foreign nationals to work in lower-skilled and semi-skilled positions: the Technical Intern Training Program (TITP) and the Specified Skilled Worker (SSW) system. These changes, set to roll out over the next three years, aim to improve worker rights and streamline pathways for foreign workers to build careers in Japan, aligning with the government’s broader objective of competing globally for talent.

Overview of Existing Programs

The Technical Intern Training Program (TITP)

The TITP is the largest program supporting foreign workers in Japan, with approximately 410,000 participants as of 2023. It allows individuals to work in Japan for up to five years, primarily in lower-skilled jobs. TITP workers are a critical part of the workforce in industries like manufacturing, agriculture, fisheries, construction, and nursing care, especially in rural areas. However, the program has faced criticism over labor rights violations, restrictive policies, and high brokerage fees charged by overseas agents.

The Specified Skilled Worker (SSW) System

Launched in April 2019, the SSW system is designed for semi-skilled workers who meet certain Japanese language and job skill requirements. This program addresses Japan’s labor shortages by creating a pathway for more experienced foreign workers. After being temporarily slowed by the COVID-19 pandemic, the SSW system has grown significantly, with a 75% increase in participants in 2023, reaching about 140,000 workers. Notably, 70% of these workers transitioned from the TITP.

Key Reforms and New Systems

Transition to the Training and Employment Program

To address longstanding criticisms of the TITP, the government has introduced a new Training and Employment Program, which will replace the TITP by 2027. Key differences include:

1. Focus on Workforce Development: The new system emphasizes securing and nurturing human resources for Japan’s economy. Unlike the TITP, which focused on skill transfer for developing countries, this program facilitates long-term employment pathways, including transitions to SSW Category 1 and SSW Category 2 statuses. These statuses allow workers to bring family members and potentially obtain permanent residency.
2. Expanded Career Opportunities: Workers under the new system can pursue long-term career growth across a wider range of industries. Previously, some TITP participants were unable to transition to the SSW program due to misaligned job categories. The new framework eliminates these barriers.
3. Enhanced Worker Protections: The new program improves workers’ rights by allowing greater flexibility in changing employers, particularly in cases of workplace abuse or violence. Workers can switch employers within the same industry after passing basic skills and language exams, with assistance from a new agency, tentatively named the Organization for Training and Employment.
4. Stricter Oversight: “Supervising organizations” from the TITP will be replaced with more robust “supervision and support organizations” that must appoint auditors and maintain adequate staffing levels. These entities will undergo periodic inspections, and those failing to meet standards will face shutdown.
5. Improved International Collaboration: Japan will only accept trainees from countries with bilateral agreements (memorandums of understanding) to ensure fair recruitment practices. Measures will also be introduced to eliminate exploitative brokers and regulate recruitment fees.

Addressing Regional and Urban Workforce Imbalances

One of the challenges posed by the new program is balancing the mobility of foreign workers with the need to support regional economies. A recent survey revealed that 39% of SSW workers who transitioned from the TITP relocated to urban areas within a month, leading to labor shortages in rural regions. However, smaller communities often offer advantages such as lower living costs and better local support, which contribute to higher job satisfaction among workers.

To attract and retain foreign talent in rural areas, businesses and local governments need to:

• Enhance support for everyday life and Japanese language education.
• Foster multicultural workplaces.
• Promote the quality of life in rural regions, including leisure opportunities and affordable living.

Building a Sustainable Workforce

Career Development and Retention

A key factor in retaining foreign workers is the opportunity for career advancement. Surveys show that foreign workers value skill-building, fair evaluations, and meaningful work. Employers should:

• Provide training aligned with workers’ goals and aptitudes.
• Foster open communication to understand individual career aspirations.
• Offer clear pathways for promotion and long-term employment.

Inclusive Workplaces

Creating an inclusive and multicultural environment is essential. Businesses must actively integrate foreign workers into their teams and ensure that both Japanese and foreign employees can thrive together. This involves:

• Providing cultural sensitivity training.
• Encouraging collaboration and mutual respect.
• Celebrating diversity in the workplace.

Conclusion

Japan’s recent reforms aim to make the country more competitive in the global labor market while addressing critical domestic workforce challenges. By fostering career development, ensuring worker rights, and promoting inclusion, Japan can become a top destination for foreign talent.