Japan’s Evolving Landscape for Migrant Workers: A Focus on Vietnamese Labor

According to statistics from Japan’s Ministry of Justice, the number of foreign residents in Japan reached a record high of 3.07 million by the end of 2022, surpassing the 3 million mark for the first time. Among these residents, a significant portion plays a vital role in the Japanese labor market through various residency statuses.

The Role of Technical Intern Trainees and Specified Skilled Workers

Within this growing foreign labor force, 325,000 ‘technical intern trainees’ and 131,000 ‘specified skilled workers’ are particularly noteworthy. These statuses are designed to facilitate work while acquiring skills, contributing to sectors where labor shortages are evident, such as food and beverage manufacturing, construction, and agriculture. However, concerns have emerged that these systems primarily serve as avenues for cheap labor, often lacking adequate training and support for workers.

Japanese society currently relies on around 450,000 foreign workers to fulfill positions that local workers are reluctant to occupy. This demographic has become not just a part of the workforce but a cornerstone of specific industries, highlighting the paradox of Japan’s aging population and declining birth rates.

The Vietnamese Workforce: A Dominant Force

Vietnam stands out as the largest source of this migrant labor, contributing 54% of technical intern trainees and 59% of specified skilled workers. Over the past decade, the Vietnamese community in Japan — including not just migrant workers but also long-term residents — has grown nearly tenfold to approximately 490,000. This reality underscores the deepening ties between Japan and Vietnam, especially in the labor sector.

Economic Shifts: The Yen’s Influence

However, the economic landscape is shifting. The depreciation of the Japanese yen, which fell to a 32-year low in 2022, significantly impacts the attractiveness of Japan as a destination for Vietnamese workers. The yen’s decline against the Vietnamese dong has led to a 10–20% reduction in wages that Vietnamese migrant workers can expect. As Nguyen Thuy Linh, President of Himawari Service, highlights, the yen’s depreciation complicates recruitment efforts for Japan.

Despite these economic challenges, Japan remains a viable option for some Vietnamese workers, whose average monthly wages hover around US$200–300. In 2021, the average wage for specified skilled workers in Japan was 9.7 times that in Vietnam, though projections suggest this disparity will narrow. By 2025, the wage differences will diminish to 5.9 times for specified skilled workers and 5.1 times for technical intern trainees. Projections for 2031 indicate even further reductions, with wages for these roles potentially becoming only three times greater than those in Vietnam.

Cost of Living Considerations

Living in Japan also presents challenges. The cost of living is approximately four times higher than in Vietnam. While migrant workers earn an average of 180,000 yen (about US$1250) monthly, a significant portion — between 40% to 50% — is deducted for living expenses, taxes, and social insurance. This financial strain can deter potential migrants, particularly as the wage gap narrows.

Addressing Labor Needs: The Path Forward

To sustain the flow of essential migrant labor, Japan must adopt specific measures.

Eliminating Brokers

Firstly, the elimination of brokers who charge high fees — often requiring Vietnamese migrant workers to borrow up to 1 million yen for travel expenses — is crucial. Such practices exploit vulnerable workers and lead to significant financial burdens that deter potential migrants.

Recognizing Migrant Worker Status

Secondly, officially recognizing technical intern trainees and specified skilled workers as ‘migrant workers’ can improve their employment conditions and treatment. The current status of trainees often leads to exploitation, as their precarious position can be leveraged by employers to force compliance and acceptance of lower wages.

Post-Return Support

Lastly, enhancing skills recognition for returning workers could be transformative. Policies should focus on developing frameworks that help returnees apply their skills in Vietnam, ensuring they are not just trained but also empowered to secure better local employment. Collaboration between the Japanese and Vietnamese governments to establish a nationally recognized qualification could significantly elevate the prospects of returning workers.

By fostering an environment where skills are valued and recognized both in Japan and Vietnam, the overall viability of Japan as an attractive destination for migrants can be preserved, even amidst changing economic circumstances.

In shaping this future, both countries stand to benefit, and the relationship can evolve into one founded on mutual respect and empowerment.