Morgan McKinley: Skills shortages and limited hiring budgets are top recruitment challenges for Japanese companies

Majority of Japanese workers are unhappy with benefits packages.

TOKYO, Nov. 13, 2023 /PRNewswire/ -- A new survey revealed that 90% of organisations in Japan have found hiring 'very' or 'quite' competitive in 2023. 42% expect 'lack of skilled candidates available' to be their greatest 2024 recruitment challenge, followed by 'no sign off for headcount' at 15%.

Despite this, the research, conducted by global talent services company Morgan McKinley as part of its 2024 Salary Guide, found that 67% of Japanese businesses still plan to hire in the next six months.

On the candidate side, one in three (34%) professionals in Japan plan to actively look for new jobs in the next six months. The survey also revealed that workers were not happy with the benefits they received: 58% being 'neutral', 'dissatisfied' or 'highly dissatisfied' with their packages. The top five desired benefits Japanese workers look for in a job are: Pension (above statutory requirements), bonus, employee stock options, work from home, and flexible working hours.

'Higher salary' remains the most valued reason for wanting to move jobs at 44%, followed by 'the role and responsibilities - doing meaningful and impactful work' at 25%. 46% of professionals in Japan are optimistic that they will receive a salary increase in 2024 and 55% of employers plan to increase salary offers in 2024 for certain in-demand roles.

Lionel Kaidatzis, Managing Director of Morgan McKinley Japan, commented: "Recruitment in Japan has been challenged throughout 2023, but perhaps not to the same extent as other global markets. With a continually weak Yen, exports have been aided and there has been an uptick in inbound tourism, fueling hiring across some industries."

"With less headcount, clients have raised the bar on the quality of the talent they want to hire, which has made the hiring of top talent even more competitive given the ongoing shortage of talent. Skilled professionals have been receiving multiple offers, and organisations lost out on talent due to long interview and approval processes."

Kaidatzis concluded: "Successive governments have tried to accelerate wage increases but with limited success. This issue is more acute now than ever, as inflation and FX rates have reduced consumer spending power."

"Organisations will need to review their compensation structures and make an effort to bring them in line with other G7 economies if they want to retain and hire the best talent in 2024."

The Morgan McKinley 2024 Salary Guide presents up-to-date and accurate salary data for a wide range of roles across Japan, providing hiring managers with industry benchmarks when they are working out what to pay employees and giving professionals more visibility over what they can earn.

Research from 650 businesses and 3,400 professionals was conducted to find out what companies' hiring intentions are for 2024, what the key motivators are for changing jobs, and what the expectations are for movement on salaries.

For the Morgan McKinley Japan 2024 Salary Guide, visit:

https://www.morganmckinley.com/jp/salary-guide

About Morgan McKinley

Morgan McKinley is a global talent services expert, offering the full spectrum of solutions to meet employers' and jobseekers' needs. With 19 offices in 10 countries and nearly 1000 employees, it provides 3 distinct solutions for customers. Morgan McKinley Recruitment Solutions encompassing deep expertise across 10 professional disciplines offering temporary, contract and permanent recruitment; Morgan McKinley Executive Search for targeted C-Suite talent searches; and Morgan McKinley Talent Solutions including RPO, MSP, Project Recruitment and more.

Morgan McKinley is part of Org, a more human kind of professional services company that harnesses the power of talent to bring better business outcomes for clients across the world through advisory, managed services and talent services.