July - Job-Hunting Part 2: Why is Japan Changing its Hiring System? Updated in July 2019

Rules for hiring “golden” university graduates were first agreed upon in the 1950s by the Japan Business Federation, or Keidanren (経団連), so that job-hunting would not interfere with students’ studies. Keidanren has about 1500 member companies that annually try to hire large numbers of new graduates. Hiring rules have gone through minor changes over decades, but the undercover recruitment race among corporate giants intensified year by year. Reflecting this reality and in order to be able to hire global candidates flexibly, Keidanren decided to get rid of hiring rules, starting with the graduating class of 2022. In the future, there won’t be official restrictions on when to start interviewing. This decision will allow companies to hire graduates anytime of the year. In fact, Japanese companies like Rakuten and Softbank have already shifted to the global year-round recruiting system.

Until quite recently, Japan was known for its corporate culture of keeping all hired employees until retirement. Now that Japan has to compete in the fast-changing global economy, the nation cannot continue to sustain its fixed lifetime employment system any longer, as expressed by the Keidanren Chairman himself. The nation must prioritize mobility of human resources. As a consequence, the situation in Japan may become more like the European and American models. On the positive side, Japanese graduates could become more open to taking gap years, seeking higher degrees or retiring early to explore different career paths. The status gap between first-tier universities and other universities may shrink, providing more employment opportunities to hardworking students from a wider variety of universities.

While this change could ease pressure in some ways, it may also create new problems. Universities are concerned that students could be polarized: those who immediately receive naitei (promise of employment) and those who need to keep pursuing one. The longer the job-hunting process, the more it interferes with one’s schoolwork leading up to graduation. The government and universities are holding discussions to come up with some kind of guideline to protect students’ options and to relieve them from excessive job-hunting stress. In the end, these changes will hopefully lead to a wider variety of options for university students—internships, service-learning, sports, study abroad, and many other student activities. Job-hunting after graduating university in any country can certainly make one think. How does your country compare to Japan?