Hiring Foreign Talent Under Japan’s Specified Skilled Worker Program Part 1: A Guide for Employers

Japan’s Implementation of the Specified Skilled Worker Program

Japan faces a significant demographic challenge with a rapidly aging population. According to the United Nations Population Division, this year, Japan leads those countries with a population of one million or more with the highest proportion of its population aged 65 and above, at 30.2%.

This comes on the heels of Japan crossing – for the first time – 10% of its population being aged 80 and above in late 2023. Compounded by a declining birth rate since 2008, Prime Minister Fumio Kishida has expressed concerns about the country’s ability to maintain social functions.

One of Japan’s evolving responses to the population crisis was its then-unprecedented move to amend the Immigration Control and Refugee Recognition Act (Immigration Act) in 2019 to officially accept low-skilled foreign talent as “Specified Skilled Workers” (SSW) equipped with the relevant skillset to start contributing immediately, to meet the demand for manpower in industries facing critical shortages, such as agriculture, building cleaning management and food and beverage manufacturing.

Despite setting an initial target of 30,000 workers, only 1,621 applications were successful in the first year. As of January 2024, the total number of SSW applicants remains far below the target of 345,000 by the end of the year, indicating ongoing challenges in meeting the demand for foreign talent.

Collaboration with Indonesia

To partially address the low demand issue, one interesting initiative undertaken by the Japan International Cooperation Agency (JICA) was to undertake a Human Resources Forum in Jakarta on 28 November 2023 in joint collaboration with the Indonesian Ministry of Manpower.

The forum, led by Kenji Kanasugi, Japanese Ambassador to Indonesia, and Ida Fauziyah, Indonesian Minister of Manpower, resulted in a Memorandum of Cooperation. This memorandum outlines initiatives for Indonesia to send 100,000 employees, primarily through the SSW Program, within the next five years. These initiatives include providing Japanese language education and skills training to Indonesians to ensure they meet the eligibility criteria for the SSW visa.

This move is mutually beneficial for both Japan and Indonesia. Japan currently has 8.75 million workers over the retirement age of 65, while Indonesia struggles with a high unemployment rate of 13% among young people aged 15 to 24. The recent decision to abolish the Technical Intern Trainee Program (TITP), known for exploiting foreign labor, further addresses concerns about working conditions for foreign nationals in Japan.

With Japan surpassing two million foreign workers just before the Japan-Indonesia Human Resources Forum, it is well-positioned to address its shortages in key industries targeted by the SSW program. Japan appears ready to surpass the slow uptake seen since 2019 and aims for an even more ambitious target of 800,000 skilled workers by 2029.

Japan’s Specified Skilled Worker Visa: Everything Employers Need to Know

SSW was initially championed by Yoshihide Suga, then-Chief Cabinet Secretary in 2018, as crucial for addressing Japan’s declining population and business challenges due to personnel shortages. Initially, it targeted significant manpower shortages in 14 industries:

• • Nursing Care;
  • Building Cleaning Management;
  • *Former Machine Parts and Tooling Industries;
  • *Former Industrial Machinery Industry;
  • *Former Electric, Electronics, and Information Industries;
  • Construction Industry;
  • Shipbuilding and Ship Machinery Industries;
  • Automobile Repair and Maintenance;
  • Aviation Industry;
  • Accommodation Industry;
  • Agriculture Industry;
  • Fishery and Aquaculture Industries;
  • Food and Beverage Manufacturing Industries; and
  • Food Service Industry.

*Consolidated into the newly established “Machine Parts, Tooling, Industrial Machinery, Electric, Electronics, and Information Industries” as of May 25, 2022.

This marks a departure from Japan’s previous focus on white-collar immigration. For example, the Engineer/Specialist in Humanities/International Services visa demands either a Bachelor’s degree or 10 years of relevant professional experience, along with specialized skills or knowledge pertinent to various fields.

Furthermore, the process is more rigorous compared than traditional work/residency applications. Companies acting as Accepting Organizations must ensure that SSW(i) holders are covered by a Support Plan submitted together with the Certificate of Eligibility/Change of Status application, confirming the foreign nationals:

• • • Receive necessary initial guidance ahead of commencing employment;
    • Are picked up from the Japanese airport of arrival;
    • Are assisted in securing appropriate accommodation;
    • Receive appropriate orientation to daily living in Japan;
    • Are adequately assisted with necessary applications/procedures concerning the Local government and/or other relevant authorities;
    • Are afforded opportunities to learn Japanese;
    • Are adequately supported in the event of employer-employee disagreements, or changes in employment in the event of downsizing, etc.; and
    • Are provided the opportunities to learn and assimilate into Japanese culture, with native Japanese.

The Support Plan mandates the company’s designated representative to meet with the SSW(i) holder or their supervisor quarterly and report any changes in their employment conditions to the administering agency.

Additionally, routine notifications, implementation of the Support Plan, and monitoring of the activity/status of SSW(i) holders (including remuneration, resignations, or absences) are required.

This can be managed by the hiring company or, more commonly, by a Registered Support Organization (RSO) accredited by authorities. If outsourced to an RSO, obligations persist until the SSW holder leaves the company, at which point the RSO must submit a final report to the immigration authorities.

It is worth noting a key difference between SSW and TITP: SSW requires mandatory Japanese language support, unlike TITP, which is expected to phase out by April 2025.

This lack of language support potentially puts TITP holders at a disadvantage from the start. Therefore, there is a strong emphasis on employers ensuring SSW holders receive the rights and protections inherent in the SSW program.

The Japanese government recognizes this and aims to align TITP reforms to attract skilled workers and protect foreign nationals’ rights, in an effort to establish Japan as the preferred destination to attract and develop foreign human resources.

Continued Interest in the Specified Skilled Worker Program

Japan’s SSW program continues to attract fresh interest from the industries facing labor shortages, as well as Japan’s trading partners in the region and beyond (led by Vietnam, which contributed just over half of Japan’s SSW population, according to ISA’s preliminary figures as at the end of December 2023).

It holds promise for enhanced economic cooperation, which was, until relatively recently, not possible within the ambit of Japan’s longstanding monoethnic and skill-intensive immigration program.

Need to Know More?

Fragomen has been providing immigration services in Japan for more than 20 years and has the technical know-how to support this category. For further information on Japan’s recently expanded immigration strategies, please contact Senior Business Immigration Manager Alfred Chong at [email protected] or Senior Business Immigration Consultant Jonathan Ying at [email protected]. Stay tuned for part two of this blog series to be released in the coming weeks.

This blog was published on 21 May 2024, and due to the circumstances, there are frequent changes. To keep up to date with all the latest updates on global immigration, please subscribe to our alerts and follow us on LinkedIn, X, Facebook and Instagram.