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Business Trends

More Japanese companies hire talent from overseas universities

Global labor trends help bring change to a stolid corporate culture

Welcome to the new Japan Inc., where Asian hires are being counted on to stimulate their native co-workers. Mercari is an online flea market that hired mainly non-Japanese graduates last year.

TOKYO -- More than a quarter of major Japanese companies have hired foreign graduates from overseas universities in the current fiscal year, which runs through March, according to an internet survey by leading employment information provider Disco.

The survey results come as cross-border battles for high-performing information-technology engineers push salaries ever hire -- a trend that is putting famously change-resistant Japanese corporate culture under great strain.

The survey of major Japanese companies was conducted in December, gaining 732 responses, Disco said. Of the respondents, 25.7% said they hired foreign graduates from overseas universities in fiscal 2018, up 5.6 percentage points from the previous year and the highest figure on record (the first survey was taken in fiscal 2013).

The latest survey also found that 31.5% of the respondents are planning to hire foreign nationals in fiscal 2019.

Disco asked on what five regions respondents might want to focus their foreign hiring. Southeast Asia was the top choice. Of the respondents, 70.1% said they would like to hire Southeast Asian graduates, 39.3% were interested in Chinese and 19.6% in South Koreans.

With digitization advancing in an increasing number of sectors, global demand for IT engineers is at a fever pitch, and competent, work-ready engineers are able to dictate high salary levels.

Google and other leading American IT companies are flocking to the Indian Institute of Technology, regarded as India's best engineering university, luring top students with attractive pay packages and work environments.

Salaries have been rising in China and Taiwan as well, and if Japan Inc. intends to compete for the world's top young minds, it is going to have to dangle more money.

This has put corporate Japan under pressure to move away from its seniority-based pay system and toward performance-based promotions and compensation.

Japan Inc. is moving in that direction, with some companies offering top graduates of overseas universities more money than typical first-years, according to Shinji Yamazaki, deputy chief of global recruitment at Disco.

Companies can also use Japanese cordiality to their advantage. Techfirm Holdings, a contract software developer, had 20 foreign nationals on its payroll as of autumn, double the number of 12 months earlier. Allali Amina, from Morocco, said that "although American and Chinese companies pay more, Japan is safer and Techfirm is nice to its workers."

In 2013, Kyowa Hakko Kirin began to hire foreign graduates from overseas liberal arts universities. The fermentation chemical company hopes high-functioning Asian workers can stimulate their Japanese co-workers. Japanese proficiency is not a requirement, but new hires receive language lessons as part of their training, the company said.

Nikkei staff writer Takayuki Inoue in Tokyo contributed to this report.

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