Japanese New Graduates Struggle Finding Jobs

Osaka – Sunday, December 19, 2010




Many Japanese mass media reported around November 21 that new graduates in Japan are struggling to get a job to start their career, and since then public and private sectors and universities have taken measures supporting as many new graduates finding a job. However, whether majority of new graduates manage to find a job by the end of March 2011 upon graduation to start working on April 1 is a question.



1. What is the usual process and timeline of recruiting new graduates?



In Japan, companies would start recruiting new graduates more than one year they start working (e.g. in autumn 2010 for new graduates who are to start working from April 2012; this is because in Japan school year starts from April), and it is a rule in Japan that on October 1 every year, companies hold a ceremony to officially give offer to the new graduates who are to start working 6 months later in April.



This means that recruiting companies and supporting universities usually switch their target of new graduate recruitment/support in October. For example, they would have been supporting job hunting of students who are to graduate in March 2011 until September 2010, but from October finish supporting them and start supporting students who are to graduate in March 2012.



2. How successful is job hunting of new graduates who should be start working in April 2011?



Many new graduates are struggling to find a job. The percentage of new graduates who were successful in officially offered a job this October was the lowest in history, 57.6%, which was minus 4.9% from last year. Approximately 410,000 students who are to graduate in March 2011 are estimated to want to find a job in private sector; however, as many as 170,000 of them have not yet found a job.



With this pace, it is quite possible that the percentage of students who managed to find a job upon graduation would be lower than the current lowest history of 91.1%, recorded in 1999.



3. What countermeasures are taken so that more new graduates can find a job?



This year, private and public sectors and universities would continue supporting students with upmost efforts who are to graduates in March 2011 after September 2010 as well, with the objective of maximizing the percentage of students who have managed to find a job by the time they graduation in March 2011.



For example, one of a leading company that provides job hunting information and services started to hosted employment fairs from December that will be held until February in 7 major cities nationwide including Tokyo, Osaka and Nagoya. Small and mid-sized companies can participate in the fairs for free. It is expected that total of 380 companies and 7800 students to participate in the fairs. It is extremely exceptional that such a large employment fairs are held this time of the year. In the fair interviewing booths are to be made to help companies give the offer on the day.



Other leading companies of the same/similar industry started a new business of introducing internship opportunities to 10,000 students in October. This will be held until March 2011 and the students will be sent as interns to workplaces such as factories of small and mid-sized companies. Such business can benefit from subsidiary of Small and Medium Enterprise Agency. 7000 yen/day will be given to an intern and 3500 yen/day will be given to a company that accepts interns. Small and Medium Enterprise Agency will also collaborate with regional association/organizations of small and mid-sized companies, and plan to send total of 10,000 students, including those who have graduated but have not managed to find a job, to small and mid-sized companies from October 2010 to March 2011.



The government has allocated with urgency total of 2.5 billion yen to make as many new graduates as possible employed, and subsidiaries are to be given to each company such as the mentioned above will from this budget. In addition, the government increased the number of universities with career counselors from 250 to 500, and introduced a system in which incentives will be given to companies that have hired people who have graduated within 3 years.





4. The author’s final thoughts



The issue is not simply about the imbalance of the number of job hunters and number of jobs available in the labour market. The issue is also about mismatch of multiple factors.



Many students who graduated 1999 – 2004 (employment ice age) could not find a job and has not been able to find a full time job even after the economy recovered in 2005, and this became a critical social issue. And with the recent worldwide recession, large companies have been holding back recruiting and hiring. So to some extent it is true that the issue attributes to decrease in number of jobs available in the labour market.



However, it is a reality that quite a few small and mid-sized companies are still short of workers. Thus, eliminating mismatch by connecting small and mid-sized companies and students has started to emerge as a new business/market for recruiting related companies. The countermeasures mentioned above are a few examples of such new businesses.



Another mismatch factor is the mismatch between the type of job the job seekers expect and the skills and competencies the hiring companies expects. This applies to job seekers who are not new graduates as well. The author would like to discuss this in one of the upcoming article.