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Business

Recruiting fees soaring in Japan's tight labor market

Engineers in IT, construction in high demand

Experienced workers in the IT and construction sectors are in high demand.

TOKYO -- Japanese companies are paying staffing agencies higher fees to hire experienced workers amid severe labor shortages, with demand for talent especially strong in the information technology and construction industries.

The industry norm for these fees used to stand at roughly 30% of the filled position's annual pay. Many businesses and recruiting companies are closing contracts at rates more than 5 percentage points higher than several years ago for IT and construction engineers.

"Contracts sometimes close at double the usual rate" for the hiring of system engineers, according to an official at staffing agency Adecco.

With the coming 2020 Tokyo Olympics, rates are also soaring for construction management engineers. The nursing care industry, which is experiencing extended labor shortages, has also seen rates climb.

The job-to-applicants ratio rose 0.14 point on the year to 1.82 in February for mid-career workers, according to Recruit Career. Significant shortages are seen for IT engineers, with the ratio hitting 3.67. The ratio for construction engineers came to 4.41.

(Nikkei)

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