Japan needs 6.74m more foreign workers
Japan will need 6.74 million foreign workers in 2040, four times more than it has today, a study by the country's aid agency shows.
The study, released on Thursday by the Japan International Cooperation Agency, also demonstrates that the country will have trouble attracting so many foreign workers as the Southeast Asian nations that many workers now hail from are expected to have to deal with aging and declining populations of their own.
The study assumes Japan will make aggressive investments in labor-saving technologies. Without such investments, the need for foreign labor would be even greater -- 21 million workers in 2040 -- the study shows.
The study estimates that Japan will fall short by 420,000 foreign workers in 2040.
Foreign workers are expected to filter into prefectures like Aichi that have large manufacturing bases as well as into cities like Tokyo that have established foreign communities. In the capital, the share of foreign workers among the working-age population is expected to reach 18%.
The forecasts are based on estimates regarding economic growth rates in Japan and other countries. The share of workers Japan attracts relative to other immigration destinations was also estimated, as was the share of workers returning home from Japan. Experts say the projections are the most comprehensive ever produced by a Japanese government agency; the report is expected to serve as a reference point for future discussions on foreign worker policy.
The finding comes as the government of Prime Minister Fumio Kishida looks into expanding the nation's foreign worker program and allow more of those who come to the country to gain permanent resident status -- an effort that could make Japan a more attractive place for foreign blue color workers.
The existing program, which came into effect in 2019, allows workers in the construction and shipbuilding industries to apply for permanent residency. So far, no blue color workers are eligible to receive similar consideration.
JICA's study indicates that Japan's restrictive immigration policy could make it difficult to attract foreign workers and start undermining the country's economic growth.
Japan has experienced severe labor shortages, especially in agriculture, construction and manufacturing. To deal with the crunch, successive governments have asked women to participate more in the labor force and seniors to delay their retirement. The study shows that these efforts are necessary but far from enough and that more needs to be done to attract foreign workers.
As of the end of October, Japan had 1.72 million foreign workers, including some 350,000 taking part in a government-approved trainee program and another 330,000 or so part-timers, mainly foreign students.
The trainee program has been the main avenue for blue color workers to enter Japan, though it has been on hold since the outbreak of COVID.
The JICA study assumes that the trainee and other blue-color worker programs will be resumed at some point this year.
It also assumes that the nation's economy will continue to expand at a rate of around 1.2% in real terms.
Workers in developing nations can be expected to continue looking for jobs overseas until their home economies mature to a certain level, according to the study.
The study projects that Vietnam will remain the biggest source of labor for Japan, accounting for 28% of all foreign workers in 2040. Other countries that are expected to send more workers to Japan are Myanmar, Cambodia, Bangladesh, Nepal and India, the study shows.
On the other hand, fewer workers are expected to come from China and Thailand.
Japan will need to attract workers from more regions, including Africa, the only continent where population growth is expected to continue, JICA Vice President Kenichi Shishido said.
Source: NIKKEI Asia
