Japanese companies are increasing their efforts to hire foreign students; businesses and local governments are helping them acquire skills to find jobs in Japan

With declining birth rates and labor shortages, and many companies expanding overseas, Japanese companies are increasingly looking to hire foreign students studying at Japanese universities.

In addition, more and more local governments are trying to match foreign students with companies that are willing to hire them.

Under these circumstances, the percentage of foreign students who found work for the first time in fiscal year 2022 exceeded 50%.

“Japanese companies offer good working conditions,” said a Vietnamese student, a final year student at the university in Kobe. “I want to connect Japan with my home country through my work.”

The student was participating in a matching event held on August 8 in Osaka City, with 44 companies from the same prefecture. The 25-year-old Vietnamese student, a fan of Japanese motorcycles and cars, came to Japan after graduating from high school. After studying at a Japanese language school, he went to university and majored in finance in hopes of landing a marketing job in the manufacturing sector.

“Information about companies looking for international students is hard to find, so I really appreciate that there is an event like this,” the student said.

The matching event was hosted by Osaka Prefecture. Several such events have been held since last year. During the event in August, 255 students from 27 countries and regions, such as Vietnam, China and Nepal, mainly from universities in the Kansai region, visited the stands of participating companies.

More and more local governments are actively trying to connect local businesses with local foreign students. The Ibaraki Prefectural Government established a group to promote the recruitment of foreign students on August 23, with members including Ibaraki University, the University of Tsukuba, and local business groups. This new organization will organize events such as internship programs and company tours in the prefecture.

In May, Kanagawa Prefecture also opened a consulting service to assist companies in hiring foreign students.

Companies expanding abroad

Companies and local governments are now paying more attention to foreign students, while the declining birth rate coincides with an increase in companies’ recruitment activities after COVID-19. This has created an environment where companies are finding it much harder to recruit new graduates.

According to Recruit Co., only 36.1% of companies that hired 2024 classmates were able to meet their initial hiring plans. That figure was the lowest since Recruit began collecting this data with the 2012 class.

Takaishi Industry Co., based in Ibaraki City, Osaka Prefecture, began participating in matching events organized by Osaka Prefecture last year as the maker of precision rubber products struggled to recruit Japanese graduates. The company, which employs about 100 people, has four factories in Japan and Vietnam.

This spring, Takaishi Industry accepted two foreign students, including a Vietnamese postgraduate student from Osaka University, through one of these events.

“His ability to speak English and Japanese makes him an important asset who can do a lot for us in Europe and the U.S. in the future,” said Junji Takaishi, head of the administrative department of Takaishi Industry. “We look forward to continuing to hire talented people.”

“If we can pave a path for talented foreign students to excel at Japanese companies, it will help us address the growing labor shortage and support the development of businesses in the prefecture,” said an official from the Osaka prefectural government.

Outflow of talented people

According to the Japan Student Services Organization, an independent administrative agency, and other organizations, the percentage of foreign students (excluding students pursuing further education in the country itself) who found jobs in Japan in fiscal year 2022 hit a record 53.3%.

“Despite getting used to life in Japan and wanting to work here, many foreign students return home because it’s hard for them to find a job here,” said Ai Ozawa, president of Vein Global, a company that supports the recruitment of foreign students. “Talented people are flowing out of the country.”

One reason for this is that Japan has a unique job search and recruitment framework, hiring large groups of recent graduates who visit companies from the beginning of their job searches.

According to a survey released in August by employment information agency Career-tasu, Inc., which included prospective 2025 graduates, most foreign students began their job search in April of their senior year, about a year later than Japanese students. The survey also found that only 46.1 percent of foreign students participated in work-related activities such as internship programs, while 88.7 percent of Japanese students did so.

Overseas, most recent graduates start looking for jobs around graduation. “Overseas students generally do not have a good understanding of the Japanese timeline for job hunting and recruitment, and compared to natives, they have a strong tendency to focus on their studies and postpone looking for a job,” said Ayumi Matsumoto, a researcher at Career-tasu. “Learning about recruitment in Japan can help more talented workers excel here.”

Universities help foreign students

Universities are also beginning to focus on supporting foreign students hoping to find jobs with Japanese companies. Waseda University began holding events last October, inviting companies from various industries, such as automotive manufacturing and electronics. The events are aimed at students of all levels, including first-years.

“We want foreign students, from their first or second year, to understand the difficulties of finding a job and the language skills they need to work in Japanese companies, and to think about how they will spend their time at school,” a university official said.

Chuo University held a counseling session in May to help foreign students apply for internship programs during their junior summer. The university explained some unique aspects of the Japanese recruitment process to the foreign students, such as the fact that qualifications and good academic performance do not necessarily lead to a job and the importance of self-evaluation and research on industries and companies.

“It is important for local governments, universities and industry, among others, to clarify the division of roles and work on this issue,” said Megumi Yuki, a professor at Gunma University who is well-versed in the employment issues facing foreign students.

“If those three parties work together to help them find jobs, more foreign students would settle in Japan and more students from abroad would be attracted to study in Japan,” Yuki added. “That would create a virtuous circle.”