Japan: Demand for IT Talent Among Highest in the Region

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In a recent global buyers survey, employers listed IT staff (especially developers and programmers, database administrators, and IT leaders and managers) to be among those positions which were hardest to fill. While in the most recent Manpower Employment Outlook Survey (MEOS), employers in India and Taiwan reported the strongest hiring plans across the globe. Additionally, employer confidence in Japan is growing steadily, with job seekers likely to benefit from the most optimistic forecast reported since the first quarter of 2008.

Buyers of IT staffing most often pointed to data/data scientist positions as the skills most difficult to recruit. This skill set was not as commonly referenced in the 2013 and 2014 global buyers survey responses; demonstrating substantial increases across the region in IT hiring activity. The category includes data scientists, data specialists, data architects and big data roles. Other frequently named difficult-to-recruit IT roles included information security roles, including IT security specialists, which also landed higher on the list this year. Java skills and project management skills ranked high for the third year in a row.

The gender gap in the Japanese workforce remains large, especially in the IT sector. Though highly educated, Japanese women who are currently in their early-30s typically have more than 14 years of schooling, women are by no means guaranteed employment. With regards to level of education, Japanese women are second only to women from New Zealand; however, they remain arguably one of Japan’s most under-utilized human resources. Moreover, Japanese women, on average, have completed more years of education than their male counterparts. Despite this fact, the gender gap persists at 25%, compared to slightly over 10% on average in other major advanced economies.

While the time to fill may be markedly less in India, where IT talent is readily available, the lower wages contribute to high attrition rates across many sectors throughout the region. The availability of quality talent, comparable market maturity and regulations in Japan make the country a viable option for sourcing of IT talent. Though Japan may be a slightly less mature market, it is more restrictive than India, with complex wage regulations and privacy constraints. An established staffing partner is essential for success in both markets, to manage labor legislation and achieve flexibility and efficiency.

Based on the MEOS, healthy hiring activity is likely in the coming quarter, with employers in Japan reporting a Net Employment Outlook of +27% in the services sector. The Outlook is 2 percentage points stronger, when compared with the previous quarter, and improves by 4 percent year-over-year. Overall, Japan presents a labor pool rich in quality, young, skilled IT talent, which has the potential to fill the growing number of IT positions, especially by those female workers with development, programming and database administrative skills.