Foreign white collar employees working for the … white collar employees working for the Japanese companies in Japan and respondents were all staffs in charge of hiring foreign employees

1992, 23-30

Foreign white collar employees working

for the Japanese companies in Japan

Misato Yamazaki*

(Nagoya City University)

The aim of this study is to examine the present stage internationalization ofJapanese companies by identifying the employment situations of foreign personnel. To obtain empirical data and statistics, a survey of foreign employeesworking for Japanese companies in Japan was made covering both companiesand foreign employees working for the Japanese companies in Japan.

Major findings were as follows. (1) All Japanese companies studied are ratherat the initial stage of internationalization in foreigner employment. (2) Bothcompanies and foreign employees aware slow internationalization in this area.(3)The disruption of communication seen in one case was not the same as others.It was stressed from the result that it is important for both parties to try toidentify mutual expectations with flexible attitude to reach some agreement byknowing each other better.

I. Introduction

Personnel development is a key for the effective

companies' activities and management. From a

business globalization point of view, the study of

employment of foreign employees in Japanese

companies in Japan will provide important infor

mation to evaluate the actual present state of

Japanese companies' internationalization. There

fore, this study is expected to bring some data to

come to a conclusion about the argument on inter

nationalization of Japanese companies in a true

sense of meaning.

There have been several empirical statistics pro

vided about foreign employees and companies hir

ing foreign employees in Japan, such as those

compiled by The Economic Planning Agency

(1988) and Kaisha Society (1989). But the view-

* The author would like to thank Professors

Yasuo Hoshino and Malcolm Trevor, Nagoya

City University, for their valuable comments.

However, the author alone is responsible for all

statements and any possible errors in this arti

cle.

point of these statistics tended to present a story

indicating only either one side of the situations.

According to the report of Ministry of Justice

(1988), there were 6,242 foreign nationals regis

tered to be working in Japan as regular working

staffs in 1986, with the qualification of passport

numbered 4-1-16-3. And it was reported that 30% of

these foreign nationals engageed in clerical

works, except for the language teaching and trade

business.

The data of The Economic Planning Agency

suggested that the companies' demand for foreign

employees is divided into three types of job: lan

guage teaching (53.7%), a job for a specific pur

pose such as engineering (9.2%) and a job consist

ing of ordinary work (9.2%). For this study, the

first type was excluded from the analysis, so the

other two types should be examined.

There exsist very scarce data covering both for

eign employees and Japanese companies to exam

ine employment issues by comparing viewpoints

from both sides. Therefore this study was de

signed to investigate the actual state of companies

and foreign employees by asking the same ques

tions to both parties. Actually, after this survey

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mnnmn^mimmi^

was started, the similar survey was done by the

Ministry of Labor in 1989 covering both companies

and foreign employees (1990). Only the difference

to be stressed between the present study and other

surveys is that all foriegn employees were chosen

without the companies' involvement for this sur

vey, while the interviewees were introduced

through the companies' personnel section for the

survey of the Ministry of Labor. Whether compa

nies involved or not is a very important factor in

order to get candid answers from the interviwees.

Although sample size for this survey was

smaller than that of the Ministry of Labor, some

similar results were obtained from both studies.

Both surveys interviewed seven companies. The

reasons to select companies were not the same,

however. In the interview for the Ministry of La

bor, the companies were chosen according to the

standards that they were hiring many foreign em

ployees and that they were judged to have already

established the employment system for foreign

employees. On the other hand, for the present

study criteria were just the opposite; companies

which seemed not to be so positive to hiring for

eign employees were selected by considering the

ratio of foreign employees to Japanese colleagues

in the company. This is because the attitude to

wards employment of foreigners among the aver

age Japanese companies would be best observed in

those companies. Statistics presented by the sur

vey of the Ministry of Justice indicated that 55.9 %

of the Japanese companies listed on the Tokyo

Stock Exchange hired no foreign workers with no

future plans to do so at the time of the survey (Ja

pan Times. 1989). This fact guided the sampling

strategy for the present study.

E. Method

1 . Interview and Questionnaire Surveys of For

eign Employees

Interviews were held with twenty foreign em

ployees working for Japanese companies in Japan

at different intervals between July 1989 and Octo

ber 1990. The time required for each interview was

typically within one hour in average (minimum 30

and maximum 90 mimutes). Only three persons

were introduced through the company personnel

section. Others were selected either at random or

by being introduced by someone who knew them.

It was important for this survey to approach inter

viewees directly without the company's involve

ment in order to get unbiased answers from them.

The questionnaire was sent to 63 foreign em

ployees between July 1989 and June 1990, without a

fixed deadline with an intention that respondents

would answer at their own free will and in their

own time. 35 responses (55.6%) were recovered.

The same schedule of inquiry was used for both

interviewing and questionnaire surveys. The ques

tion items were divided into the four general ar

eas: personal background, job and compensation,

work environment, and job qualifications. This

was followed by free discussions or comments

that interviewees or respondents were currently

interested in or worried about.

The interviewees and respondents could select

either English or Japanese for responding. Some

were not native speakers of these languages but

they were asked to speak or write in either one or

the other languages. All the interviews were car

ried out by only a single interviewer.

2. Company Interview and Questionnaire Sur

vey

Interviews were held with seven Japanese com

panies hiring foreign white-collar employees at

different intervals between July 1989 and October

1990. The time required for each interview was in

average one and a half hours (minimum one hour

and maximum two hours). The questionnaire was

sent out to four Japanese companies hiring for

eign employees or considering to hire foreign em

ployees between July and October 1989. Responses

were received from all four. After receiving re

sponses, the compannies were asked to answer

some additional questions by the phone.

The same set of question was used at interview

and questionnaire studies. The contents of the

questions were divided into three areas: the back

ground of hiring foreign employees, job and com

pensation, and a present status and future pros

pect of hiring foreign employees. The interviewees

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Foreign white collar employees working for the Japanese companies in Japan

and respondents were all staffs in charge of hiring

foreign employees in the personnel department.

All the companies examined were listed on the

first section of the Tokyo Stock Exchange. The

field of business differed each other except for the

two companies belonging to the same field, but

companies were divided into three types: manufac

turing, construction and service. All the interviews

were carried out by the one interviewer.

Iff. Results

1 . Personal Background

The distribution of all respondents in terms of

sex and age is shown in Table 1. Their jobs were

divided into two types: 42 persons (76.4%) were in

clerical work, and 13 persons (23.6%) were in tech

nical work area. Regrardless of the fact that there

were 14 nationalities, 26 of the 55 respondents

(47.3%) were from the USA, and only 12 (21.8%)

were from Asia. The proportion of the US nation

ality was rather higher than that of other nation

alities. The three compnies interviewed explained

this situation saying that they would like to hire

people whose nationality was the same as the

country where they intended to expand their busi

nesses. However, an apparent preference for na

tionalities might not be desirable for the further

globalization of Japanese business.

Table 1. Age and sex of the respondents(foreign employees)

Age Male Female Total

20's 29 4 33 (60 %)

30's 16 1 17 (30.1%)

40's 5 0 5 ( 9.1%)

50's 0 0 0

Total 50 55 (100 %)

Table 2. Reasons for employing foreign nationals(multiple answers by companies interviewed)

1. For the internationalization 8 (72.7%)

2. Due to shortage of manpower 6 (54.5%)

3. Special ability which cannot bereplaced by Japanese employees 6 (54.5%)

2 . Motivation

From the viewpoint of supply and demand in the

labor market, one has to consider motivation:

both the motivation for Japanese companies to

hire foreign employees and for foreign employees

to be hired by Japanese companies in Japan. An

effort was made to seek this question through the

interview, regarding where the companies' de

mand and the foreign employees' supply meet At

interviews, most of the Japanese companies

pointed out the following three reasons for hiring

foreign employees. (1) The need for a specified field

where some specific abilities were required was

pointed out by six of eleven companies (54.5%).

(2) Six companies (54.5%) reported that they

needded engineers due to the shortage of man

power. (3) Another reason is for adaptation to

companies' internationalization inside and out

side the company. (Table 2)

As for foreign employees' motivation to work

for Japanese companies in Japan, it is divided

into three types. The first type is the carreer-

motivated group (16 of the 55 respondents) who

came to Japanese companies for career enhance

ment (29%). The second type is those who were

interested in Japanese business and customs, com

prising 21respondents (38.2%) and those 4 respon

dents, (7.3%) who had come to firms in Japan for

cultural or linguistic interests. Finally, the third

type is those who had come for the immediate

work and money (see Table 3 for the detail).

To have better employment relations for both

employers and employees, some important issues

need to be taken into consideration as objects of

Table 3. Motivation for coming to work for theJapanese company reported by foreignemployees

1. Career enhancement 16 (29 %)

2. Interest in business 21 (38.2%)

3. Cultural, linguistic 4 ( 7.3%)

4. Immediate work opportunity 6 (10.9%)

5. Money 3 ( 5.5%)

6. Other 5 ( 9.1%)

Total 55 (100 %)

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further study. These objects should include the dif

ferences in motivation between different types of

white-collar foreign employees, namely, the

short-term career group and those who prefer a

long-term contract. A clear difference of motiva

tion is also seen between fresh recruits and mid-

career hires. The former have never experienced

work in companies except for the present ones,

thus their evaluation on working conditions is

limited in perspective. The latter have worked in

other companies and can compare their present

conditions with what they experienced elsewhere.

They can analyze their job situations better than

the former, and also know how to adapt to the

Japanese companies better. The results of inter

views shown in Table 4 need to be interpreted by

considering this difference.

3 . Duration of Stay

According to Table 5, more than 60% of the em

ployees see themselves staying with the company

in Japan for a period of up to five years. Only

about 11% of them see that they will stay longer

than that. (Table 5) This trend does not indicate

that the foreign employees think it is not worth

while working for the Japanese companies for

more than five years, but that they are following

their own career plans.

There were several persons interviewed who re

ported that they were working at rather lower

salaries than those in their home countries, be

cause they wanted to know more about Japanese

ways of doing business and to adopt them to their

business in home countries after leaving Japan.

The "career group" identified in Table 3 tended to

select his own job in order to help his future ca

reer. They said they have no sense of guilt towards

the company for leaving before the end of the con

tract. These are very typical patterns seen among

talented or highly capable foreign employees clas

sified as a career group. This group act or choose

their jobs according to their own plans or deci

sions, not for the sake of salary or some idea

of loyalty. They try to find opportunities by them

selves. Japanese employers should therefore ex

plain not only the kind of job assignment and the

job description to such career-oriented employees

precisely, but also the companies' expectations of

them in order to create a better mutual under

standing.

The question of how long employees will con

sider remaining with the company is so important

for employers that correct information is needed

to answer the question. Japanese employers know

the importance of this question very well, but it

must be stressed that each foreign employee may

think differently in this regard, and their self-

perception may differ in each case. It is also neces

sary for companies to maintain flexibility in each

situation.

Table 4. Comparison of Japanese employment conditions to those experiencedin other employment reported by foreign employees

Better Equal Worse Don't know Total

12 (21.8%) 14 (25.5%) 19 (34.5%) 10 (18.2%) 55 (100%)

Table 5. Estimated years of stay with the company reported by foreign employees

Estimated years of stay

-1 2~3 4-5 6-910 years TT

Uncertainor more

Total

9

(16.4)

13

(23.6)

13

(23.6)

2

( 3.6)

6 12

(10.9) (21.8)

55

(100%)

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Foreign white collar employees working for the Japanese companies in Japan

4 . Promotion

Promotion aspects for employing white collar

foreign nationals should be considerd carefully in

relation to their motivation to work or their per

ceptions of the job, because the duration of their

stay with the company in Japan will be deter

mined by their expectations and perceptions of

their promotion situations.

Table 6 displays foreign employees' promotion

prospects associated with working for Japanese

companies. Results indicate that almost half of

foreign employees think prospects are rather bad,

in spite of the fact that they are paid at least as

much salary as their Japanese colleagues. (See

Table 8)

5 . Cultural problems

(1) Employment contract

The results of interviews and questionnaire sur

veys indicated that only nine out of total respon

dents (16.4%) were hired on a life-time employ

ment contract. Other respondents were found be

ing hired on a contract for a limited time period.

Selection of contracts was made possible for for

eign employees in some companies, but in some

others there was no life-time employment avail

able for foreign employees. For example, two of

three employees working for the same company

reported that their company did not provide life-

Table 6. Promotion prospects in the Japanese companies reported by foreign employees

Promotion prospects

Good Bad Don't know Total

22

(40)

24 9

(43.4) (16.4)

55

(100%)

time contract for foreign employees, while they

considered a life-time contract to be suitable for

them. It might be important for all foreign em

ployees to be able to select the type of contracts by

their own initiative. As the payment system would

normally correspond to the type of contract, the

selection of the life-time employment must be

made available for foreign employees.

(2) Overtime

As seen in Table 7, almost 70% of employees

were doing overtime work every day. Adding this

figure to the occasional overtime workers makes

the total figure to be over 90% (Table 7).

Almost all of the foreign employees inteviewed

in this survey thought that a great deal of overtime

was not actually necessary. They reported that in

many cases, Japanese colleagues were expanding

work which could be done within regular working

hours. However, they were doing as much over

time as their Japanese colleagues in order to pro

tect themselves against the criticism that foreign

ers were different, even though they believed over

time work was unnecessary. This issue should be

considered more seriously because it is one of the

important problems to be solved through discus

sions between employers and foreign employees.

6 . Perception Gap

Almost half of foreign employees (26 persons,

47.3%) felt that they were being hired only in order

to enhance the companies' image of international

enterprises (Table 8). In other words, companies

could hire "any" foreign employees rather than

"someone" with specific abilities. This kind of

perception influences employees' loyalty nega

tively. In contrast, the companies' perception of

foreign employees was different from that of the

employees themselves as shown in Table 2.

Table 7. Frequency of overtime work reported by foreign employees

Frequency

Everyday ^ Almost everyday Occasionally Seldom Never Total

8

(14.5)

31

(56.4)

12

(21.8)

2

( 3.6)

2

( 3.6)

55

(100%)

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Table 8. Company's expectations*What does the company expect from you ?

1. Achievement of company's target

2. Language ability as a native speaker

3. Internationalization of company's business

4. To provide information about home country's market

5. Internationalization of work environment

6. Not certain (company seemed to hire foreigners to meet the current)

7. To learn Japanese as fast as possible to handle any work

8. As a test case to hire foreigners

9. To work in the company's subsidiary eventually

* Open-ended responses were classified into the above 9 categories.

17

30

36

20

6

26

3

11

9

Namely, six out of 11 companies interviewed an

swered that they hired foreign employees for their

specific abilities which Japanese employees could

not substitute for, and that they therefore hired

foreign employees by necessity (See Table 2).

A clear difference of perception exsists between

the Japanese companies and their foreign employ

ees. It might be necessary for companies to let

their foreign employees know that they are needed

by the companies. At least it is necessary at pre

sent to get to know, and to explain the differences

each other to be able to come to some compro

mise.

It may be needed as well for foreign employees

to know Japanese customs, including business

customs and social life in order to be accepted as

members of Japanese companies and Japanese

society. It would also be better for Japanese com

panies to educate foreign employees about Japa

nese ways of doing business and customs which

seem somewhat different from foreign ones in or

der to deploy them more effectively. However,

only one Japanese company interviewed was con

sidering the necessity of general orientation. In

addition, six out of eleven companies were think

ing that Japanese language education is necessary

for foreign employees, regardless of the fact that

eight out of the eleven companies think that OJT is

necessary for foreign employees as well. In order

to achieve true internationalization, it would be

necessary to make foreign employees conceive of a

basic understanding of Japanese companies first.

This would include more language training and

OJT. In addition, some consideration should be

given by foreign employees themselves to solve

these problems. Foreign employees reported that

they are not to be getting used to Japanese cus

toms and many are not even trying to do so. With

reference to the results of the interviews and the

questionnaire survey, five out of 55 respondents

(9.1%) could neither read nor write Japanese at

all. Including the number of intermediate-

beginners of Japanese language, more than 36% of

foreign employees could not read and 45% of them

could not write Japanese, in spite of the fact they

were working for Japanese companies in Japan.

The more serious effort to learn Japanese lan

guage and to know Japanese companies better

need to be made by foreign employees themselves

so that better evaluation by their Japanese col

leagues and companies will be established, and

they can become real and equal members of the

company. By knowing each other, there will come

a better adjustment inside the companies. And this

adjustment arising out of mutual understanding

within the home office in Japan will become a pre

requisite towards internationalization in over

seas.

Though some unique cultural problems for for

eign employees exist in Japan, comparable

ploblems might as well exist anywhere for those

who live outside in their own countries to a certain

extent. Much attention should be paid to how far

foreigners would change their ways of life to new

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Foreign white collar employees working for the Japanese companies in Japan

circumstances in order to adapt to those in an

other country. Japanese companies interviewed

seemed to have keen awareness of this issue from

their experiences with foreign employees. Seven of

the ten companies interviewed (70%) reported that

they considered the importance of judging foreignemployees' capability to adjust themselves to

Japanese companies and the Japanese way of liv

ing at the interviw held with foreigners upon recruiting.

It may be said that the more foreign employeesknow about Japan, the more they can adapt them

selves to the Japanese way of life and to Japanese

companies, and therefore the more they can work

efficiently in Japanese companies without need

less misunderstandings. Both companies and for

eign employees would need to give more serious

considerations to this point again.

7. How to Treat Foreign EmployeesThe results of the survey indicated that all of the

ten companies interviewed were paying their for

eign employees additional money with the inten

tion of helping them with the high cost of housing.The amount of money ranged from ¥20,000 to

¥50,000 per month depending on the company(Table 9). As a result, the foreign employeeswerebeing paid more than their Japanese colleagues bythe amount of the housing allowance. This maybecome a problem, because Japanese colleaguesmay consider this payment system to be unequal,

and that companies are discriminating againstJapanese employees in favor of foreign employees. Therefore, it is necessary to design a carefultreatment of the housing allowance.

8. Professionalism: Generalists vs. SpecialistsIn order to discuss the issue of professionalism

adequately, it is necessary to understand the ques

tions involving generalists and specialists. Again,

the results shown in Table 2 may lead to the con

clusion that Japanese companies prefer to hiring

foreign employees with special abilities, and thus

companies favor specialists in making hiring deci

sions on foreign applicants. On the contrary, as is

well known, Japanese companies favor hiring

Japanese employees newly graduated from the

school and bring them up within the company. In

this way, Japanese companies want Japanese em

ployees to be generalists who can deal with broad

aspects of company responsibilities and job re

quirements, and will stay lifetime in the same

company.

A clear difference can be seen between com

pany's attitudes towards specialists and general

ists. This difference may lead some companies to

respond differently to Japanese (as generalists)

and to foreign employees (as specialists). Among

companies interviewed, some of them were consid

ering hiring foreign employees as regular employ

ees. These companies were trying to hire foreign

employees who agreed to accept the same terms

and conditions of employment as those of Japa

nese colleagues as regular employees with a guar

antee of life-time employement. On the contrary,

they were hiring those who do not accept the same

conditions as those of the Japanese regular em

ployees, on the basis of a contract with a limited

time period. In order to promote hiring practices

of foreign employees, this multiple selection of

employment contract may be one of the best solu

tions at the present stage of globalization.

IV. Conclusion

An ideal typical international company should

act in borderless across nations, races, and

Table 9. Employment conditions reported by the company

1. The same as Japanese colleagues' conditions 9*

2. Better than Japanese colleagues' conditions 1

3. Worse than Japanese colleagues' conditions 1

* All nine companies were actually paying extra allowanceswith the intention of helping the housing cost.

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iwnmn^mimmm

cultures. They should have an international phi

losophy that stands on an equal and fair basis. In

contrast, as seen in this survey, Japanese compa

nies do not seem to become truly internationalized

yet. For real internationalization, it is necessary

to respect differences in employees with different

cultural background. Japanese companies need to

pursue the internationalizatin of its business by

:onsidering the differences in cultural background

Dfforeign employees.

For the true internationalization of Japanese

companies, internationalization of personnel

management practices must be established. This

.s why it is significant to examine the internation

alization of personnel in Japanese companies

lere. All the companies interviewed were at the

stage of becoming aware of differences and simi-

arities among foreign employees. The foreign

employees were also at the same stage of learning

hese differences. Both parties will have to work

Dut many difficulties to seek a solution that is

nore agreeable for both of them. To do this, both

parties need to have flexible attitudes in order for

,hem to be able to pursue the same goals in the

corporate activities. Since some compromise may

)e required in order to achieve their goals, both of

hem should be able to work together and to share

he same company philosophy.

References

Japan Times 1989 Foreigners seen as 'Useful',

February 27.

Kaisha Society 1989 Tokyo kaisha society salary

survey, Kaisha Society.

The Economic Planning Agency 1988 Wagakuni

ni okeru gaikokujin koyo no jittai to mondai-

ten (The actual conditions of employment of

foreigners in Japan), Kikan Jinji Gyosei

Quarterly, 41.

The Ministry of Justice 1988 Wagakuni no

gaikokujin rodosha ukeire eno taio (The way

to respond to acceptance of foreign workers in

Japan), Kikan Jinji Gyosei Quarterly, 41.

The Specialist Committee on Foreign-National

Employees, The Research Committee on Hu

man Resource Management, Industry and La

bor Research Division, The Japanese Minis

try of Labor 1990 Gaikokujin Senmonshoku

Senmon Iinkai Hokokusho (A report on the

questionnaire survey on foreign national em

ployees of Japanese companies), The Minis

try of Labor.

(ip^4^4^20S§m, ¥l£4*P5jnO£SI)

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