Foreigners could ease Japan’s labour shortage, but Tokyo prefers robots

• The world’s third-largest economy must cope with an acute labour shortage and a declining population.
• But the government remains resistant to reforming immigration, beyond accepting skilled professionals, amid fears of disruptions to social order.
• The country received nearly 20,000 applications from asylum seekers last year but accepted only 20.

Japan’s shrinking population has triggered the country’s worst labour crunch in a quarter of a century. With a job-to-applicant ratio at levels unseen since the mid-1970s, economists have long recommended to Prime Minister Shinzo Abe that he loosen the country’s strict immigration rules.

But a deep-seated emphasis on cultural homogeneity means Tokyo prefers artificial intelligence over permanent foreigners for vacant positions.

The world’s third-largest economy is rapidly aging, on the back of high life expectancy and falling birth rates. That’s produced fewer workers, reduced consumer demand and brought about declining prices. Still, Abe’s government doesn’t believe in allowing immigration to make up for labour shortages, amid fears that newcomers could disrupt social order.

Instead, the administration wants to use information technology, artificial intelligence, and female and elderly workers to deal with the labour shortage.

But experts are wary of that strategy: “Although automation can mitigate the declining population, larger immigration will be the solution,” said Kohei Iwahara, economist at Natixis Japan Securities.

Foreign workers wanted — but not permanently

Japan wants migrants, not immigrants, explained Stephen Nagy, associate professor at Tokyo-based International Christian University and distinguished fellow at the Asia Pacific Foundation of Canada.

Temporary workers are needed for low-end service sector jobs, manufacturing, old age care and other areas hit by labour shortages, but Tokyo doesn’t want those workers to become permanent.

“Policy makers have studied Germany’s guest workers program and came to the conclusion that temporary migrants are a more rational migration strategy to maintain social stability and a consolidated identity,” Nagy explained. “They also feel it prevents or minimizes the anti-migrant problems and violence seen in Europe and other countries.”

“There is concern that Japan could face social problems and rising crime if it welcomes large unassimilated communities of foreign workers,” echoed Jeff Kingston, director of Asian studies at Temple University Japan.

Tokyo has opened certain sectors to overseas professionals, such construction and nursing, resulting in a spike of foreign residents in recent years — a record 2.38 million foreign residents were reported in 2016. But the path to permanent residency remains tough.

Last month, Abe announced his intention to allow more professional and skilled foreign workers, but he wants a limit on their duration of stay and prevent family members from accompanying them.

“Although hard barriers, such as the immigration law, have been relaxed, soft barriers still remain,” said Iwahara. “For example, in order to qualify for an employment visa, applicants need to pass a Japanese language test, which could be challenging.”

And because English language skills among Japanese remain low, citizens may not always be comfortable directly working with non-Japanese speaking foreigners, he said.

Tokyo’s rigid refugee policy — the government maintains a 99 percent rejection rate — is also under intense scrutiny as the number of globally displaced people hits a record high.

The country received nearly 20,000 applications from asylum seekers last year but accepted only 20, according to government data, down from 28 people in 2016.

“Japan has welcomed less than 1,000 refugees since 1982,” noted said Kingston: “Such minuscule numbers, less than tiny Iceland, deprive Japan of any potential dynamism.”