Training or Employment?

Japanese Immigration Policy

in Dilemma*

Nana Oishi
International Labour Office

This article examines the Japanese training system for foreign workers from
developing countries. While providing foreign trainees with the opportunities
to acquire skills and knowledge at enterprises, the system concurrently
serves as an adjustment function in the labor market. Many small- and
medium-sized enterprises largely in manufacturing the sector accept trainees
to cope with labor shortages as well as to gain a foothold for their future
business operations overseas. Various studies have shown that there exist a
substantial number of abusive cases where training is not provided properly.
The fundamental problem derives from the gap between a strict immigration
policy and the Japanese economy’s structural dependence on foreigners. A
clear national consensus must be established on whether or not Japan
should accept semi- and unskilled foreign labor. The immigration policy
should reflect this in formulating its long-term vision. The training system
needs reformation to fulfill its functions appropriately and to protect
trainees from abuse.

Technology transfer and human resources development have been given

a high priority in Japan’s Official Development Assistance. The acceptance
of foreign trainees, in this regard, forms an essential element of Japan’s
economic and technical cooperation programs. The number of foreign
trainees reached the level of 40,000 in 1991. The government envisages the
acceptance of 100,000 trainees by the end of the century through conven-
tional training schemes as well as the newly established Technical Intern

* This subject is more fully discussed in Oishi (1995). The opinions expressed in this article
are the author's and do not necessarily represent those of the ILO.

Asian and Pacific Migration Journal, Vol. 4, No. 2-3, 1995 367

Downloaded from amj.sagepub.com by guest on March 24, 2015

368 ASIAN AND PACIFIC MIGRATION JOURNAL

Training Program (TITP). While training is considered to be an effective

method to transfer knowledge and technology, as well as to contribute to
human resources development, its implementation can be rather problem-
atic. The current training system leaves open the possibility of being used
as a means of coping with labor shortages. In other words, the training
system also serves as an adjustment function in the labor market.
This article examines the Japanese training system, comparing its
objectives and actual implementation, and addresses some unresolved
issues.

Historical Development of the Japanese Training System

Japan has a relatively long history of accepting foreign trainees through

both governmental and private channels. The governmental channel was
established in 1954 when Japan joined the Colombo Plan with a view to
promoting social and economic development in Asia. This official channel
has undergone modification and diversification over the years, and now
encompasses several types of programs with a number of accepting
and/or implementing agencies. In 1993, approximately one quarter of
foreign trainees entered Japan through the various governmental or semi-
governmental programs. The private channel was initially developed by
large corporations following the expansion of the Japanese economy. As
emerging Japanese multinationals started investing in Asia from the mid-
1950s, the needs for training their overseas staff gradually became recog-
nized. Yet since these corporations produced less than one percent of their
total output in overseas plants and subsidiaries, this private channel was
of minor importance during this period.
A different type of private channel was developed in the 1960s with a
view to solving emerging labor shortages in Japanese industries. It is
estimated that thousands of unskilled or semi-skilled workers from the
Republic of Korea, Taiwan, Indonesia, Thailand and Malaysia entered
Japan as “trainees” during this period (Ochiai, 1975:37). Included among
them were nurses and medical assistants, reflecting growing labor short-
ages in Japanese hospitals.
Severe labor shortages, where job vacancies exceeded job seekers by 87
percent (OECD, 1975:16), triggered the first heated debate among business
leaders, politicians and journalists over whether Japan should import
foreign labor to cope with the predicament. Many reports were submitted
from business organizations to the government, emphasizing the necessity
of opening up the labor market to foreign workers. Some of the reports
recommended a training scheme which is in fact a prototype of the present
training scheme. The scheme was to provide foreign workers with off-the-

Downloaded from amj.sagepub.com by guest on March 24, 2015

JAPANESE IMMIGRATION POLICY IN DILEMMA 369

job training (e.g. courses on the language, culture, technology and/or

management skills) and on-the-job training at Japanese companies for a
limited time period. In other words, the blueprint for the current training
system already existed in the 1960s. These efforts to bring trainees into
Japanese enterprises, however, ceased after the economy was hit by the oil
crisis in 1973.
It was not until the late 1980s that an influx of trainees entered Japan
again. Since 1985, when the yen was sharply revalued and domestic
production became costly, a number of Japanese corporations have relo-
cated their manufacturing plants overseas, mainly to Asia where abundant
inexpensive labor is readily available. Between 1985 and 1990, the flow of
new Japanese direct investment to Asia increased more than six-fold and
led to the hiring of more than 700,000 locals (Furuya, 1991:12; cited in Pang,
1993:28). Consequently, the needs of training their overseas staff became
indispensable in the light of human resources development within their
management strategy. A number of companies brought their overseas staff
to their headquarters or main offices in Japan to provide skill- or manage-
ment-training.
A number of enterprises which remained in Japan also started accept-
ing trainees. Many of them were either small enterprises in the manufac-
turing sector which did not possess enough capital to move overseas, or
enterprises in the “non-traded” sectors such as services and construction.
Many such firms faced difficulties in attracting young Japanese nationals
due to their work environment which was often characterized as “3D”
(dirty, difficult, and dangerous). Labor shortages became acute as the
Japanese economy grew rapidly from the late 1980s to the early 1990s. A
number of enterprises with insufficient manpower had a choice between
going bankrupt or relying on foreign workers and/or trainees. The status
of trainee especially was an advantage for companies since it did not
officially entitle them to a regular salary, but only to a training allowance.
In addition, the content and quality of training was entirely at the discretion
of receiving companies as there was virtually no official control over the
training process. As a result, quite a few abusive cases were reported where
companies used trainees as cheap labor under the pretence of “on-the-job
training.”

Revision of the Training System and Technical Intern

Training Program (TITP)

The de facto employment of trainees as foreign labor gradually became a

major concern of the government. This concern was reflected in the
revision of the Immigration Control Act in 1989 (enacted in 1990) and

Downloaded from amj.sagepub.com by guest on March 24, 2015

370 ASIAN AND PACIFIC MIGRATION JOURNAL

subsequent notifications of the Ministry of Justice which placed tight

controls over the training system.
The Immigration Control Act stipulated the basic conditions to be met
by applicants and receiving organizations, i.e. the type of skills to be
acquired, trainee’s qualification, training environment, etc.1 It also deter-
mined which types of receiving companies and intermediary organiza-
tions would be admissible, and the acceptable number of trainees per
company, as well as placing strict limits on the quality of on-the-job training
to protect trainees from abuses.2
However, having found these regulations too strict, most of the small-
and medium-sized enterprises submitted complaints and pressured the
government into lifting some of the restrictions. As a result, the govern-
ment issued decrees which relaxed the conditions for the acceptance of
trainees and the implementation of training. A new decree also admitted
agricultural farms as receiving organizations, enabling them to receive up
to two trainees per farm. It reflected the severe labor shortages in agricul-
tural sector caused by urbanization, depopulation of farming areas and
aging of the labor force. Furthermore, the decree expanded the proportion
of time that a trainee spends on-the-job by reducing the quantity of off-the-
job training from one-third to one-fourth or one-fifth of the total training
period, depending upon the conditions met by companies.3
On the other hand, under conditions of severe labor scarcity, especially
with the increasing number of bankruptcies of small- and medium-sized
companies, business organizations put great political pressure on the
government to open up the labor market to foreigners. A number of these

1
Some of the basic conditions are the following: (1) the skill to be obtained must be not be
of the kind that can be acquired through repetition of simple work, and must be of the kind
which is difficult or impossible to obtain in the trainee’s country of origin; (2) a trainee must be
at least 18 years old and expected to engage in a job requiring the skill obtained in Japan upon
return; and (3) the trainee-receiving organization/company must assign a trainer who is a full-
time employee of the organization and has at least five years’ experience in the skill concerned.
(See Ministry of Justice Ordinance No.16 of 1990 for the details (Ministry of Justice, 1993:89-90)).

2
There are quite a few requirements to be met if on-the-job training is included in the
training. See the Ministry of Justice Ordinance No.16 of 1990 (Ministry of Justice, 1993:90).

3
The amount of off-the-job training can be decreased to one-fourth if preliminary training
was provided for at least 160 hours over a period of one month or more at a foreign public
organization, a joint venture or subsidiary of the Japanese receiving company during the past
six months. The ratio of one-fourth also applies for cases where the training program contains
more than four months of on-the-job training. The off-the-job training decreases even further to
one-fifth of the total duration if both conditions of preliminary training and the length of on-the-
job training are met. See notification No. 569 of Ministry of Justice issued in 1992 (Ministry of
Justice, 1993:377).

Downloaded from amj.sagepub.com by guest on March 24, 2015

JAPANESE IMMIGRATION POLICY IN DILEMMA 371

organizations also submitted a draft training scheme for foreign workers

as an alternative to the formal intake of unskilled labor. Nevertheless, the
Japanese government could not easily respond to this demand because of
its immigration policy which does not allow the importation of unskilled
foreign labor. As viewpoints differed on changing the policy even among
ministries, the government decided to revise its training system rather than
to open the labor market. This revision took into account the scheme
proposed by business organizations.
The revision of the training system was based on two measures. The
first was the establishment of the Japan International Training Cooperation
Organization (JITCO) in 1991. Under the joint auspices of the ministries of
Labor, Justice, Foreign Affairs, International Trade and Industry, and
Construction as well as with financial support from private industries,
JITCO has taken on a key role in training matters, including extensive
advisory services and technical assistance for receiving companies.
Secondly, a new revised training scheme called the Technical Intern
Training Program (TITP) was launched in April, 1993. The TITP is not a
replacement, but an extension of the conventional training scheme. Train-
ees can proceed to the TITP only after completing a period of conventional
training which comprises off-the-job training and on-the-job training, and
then successfully passing a skill evaluation examination (Chart 1). The
most notable characteristic of the TITP is that it is conducted under a formal
employment contract. The “technical interns” (a new term for the trainees
engaged in the TITP) are officially defined as workers and are hence
protected by the same labor-related laws applicable to Japanese workers.
The total period of training must not exceed two years for the conventional
training and TITP combined. An extension of the internship or a change of
residential status is not allowed. Family reunification also is prohibited.
As of June 1994, there were 1,492 technical interns engaged in technical
internships. This relatively small number is attributable largely to the
economic recession and partly to limitations imposed by the current skill
evaluation system. The system allows examinations of only 44 skill types
(another 5 types will be added as from April 1995), compared with 133
types of skill examinations for Japanese in the vocational examination
system. However, it has proven difficult to increase the number of skills for
which technical internships are available due to the pressure of trade
unions which are concerned that the increase of technical interns could
threaten employment opportunities for Japanese workers.
Although the impact of the TITP has still remained minor in numerical
terms, JITCO predicts that the number will increase again as soon as the
economy recovers, given the fact that JITCO receives numerous inquiries
from companies interested in receiving trainees and technical interns.

Downloaded from amj.sagepub.com by guest on March 24, 2015

 CHART 1
372
CONVENTIONAL TRAINING PROGRAM AND NEW TECHNICAL INTERN TRAINING PROGRAM

"Training Program" New "Technical Intern Training Program"

"Off-the-job training" (in "On-the-job training"
the Japanese language
as well as life, culture,
conventions, etc.) Practical mastery under an employment relationship

(about 1/3rd~1/5th of (about 2/3rds~4/5ths

the training period) of the training period)
X

X.
Assessment of training Certification of
results completion of the new
"Technical Intern Training

X ...........
Program"

Certification of skills and

acquired (on request)
The new "Technical Intern Training Program"
period (status of residence: "Designated ....... X
X
!X X
.... "Training Program" period Activities"): no more than 1.5 times as long
(status of residence:
as the "Training Program" period

Downloaded from amj.sagepub.com by guest on March 24, 2015

"Trainee")

SOURCE: Ministry of Labor, 1994.

NOTES 1: The period of "Off-the-job training" may be shortened as follows:
1 Has undergone some advance training in the home country ................................... to one-fourth of the "Training Program" period
2 The period of "On-the-job training" is four months or more .................................... to one-fourth of the "Training Program" period
3 Satisfies both of the above ............................................................................................... to one-fifth of the "Training Program" period
(this handling of the training period took effect in December 10, 1992)
ASIAN AND PACIFIC MIGRATION JOURNAL

2. The combined length of the "Training Program" and the new "Technical Intern Training Program" periods shall be no more than two
years.
JAPANESE IMMIGRATION POLICY IN DILEMMA 373

TABLE 1
INFLOW OF FOREIGN TRAINEES BY SELECTED COUNTRY OF ORIGIN, 1982-1993
Korea China Thailand Indonesia Philippine Malaysia Total

1982 829 1,217 670 1,168 794 430 9,973

1983 1,366 1,495 899 993 685 867 11,929
1984 1,505 2,122 1,035 1,109 927 753 13,262
1985 1,604 2,541 1,233 1,135 1,134 610 13,987
1986 2,336 2,848 950 1,114 968 620 14,388
1987 2,800 2,688 2,428 1,310 1,207 757 17,081
1988 3,343 3,840 4,708 1,378 2,464 1,329 23,432
1989 4,125 3,496 4,502 1,748 3,974 2,175 29,489
1990 4,485 7,624 5,075 2,891 3,460 3,564 37,566
1991 4,439 10,668 6,290 3,883 4,476 4,307 43,649
1992 3,717 15,054 5,385 3,687 3,931 2,959 43,627
1993 3,224 15,688 4,075 3,443 2,942 2,174 39,795

General Characteristics and Trends

Since the official residential status of “trainee” was established within the
Immigration Control Act in 1982, the number of trainees has quadrupled,
reaching a peak of 44,000 in 1992 (Table 1). Although its growth has slowed
due to the economic downturn, the number still remains at the level of
40,000. About 90 percent come from Asia with the largest proportion by far
coming from China which comprises about 40 percent of total number of
trainees. Other countries of importance are Thailand, Indonesia and the
Republic of Korea (Table 1).
A typical profile of a trainee is a young male in his 20s or early 30s. The
level of education varies depending upon which intermediary organiza-
tion he comes through, since each of these organizations has its own criteria
for education. Yet most of them are generally well-educated. Komai’s
(1992:16) data showed that 44.3 percent of trainees held a university degree
or above, 21.6 percent held a technical degree, 28.0 percent held a high
school diploma and only 5.9 percent held a junior high school diploma.
Trainees do not receive a “salary” but rather a “training allowance.”
This is attributable to the fact that training is officially defined as a non-
employment activity. The allowance normally ranges between 50,000 yen
and 80,000 yen (US$500 - US$800) per month, which is relatively low.
Nevertheless, there is no officially set minimum standard at the moment.

Downloaded from amj.sagepub.com by guest on March 24, 2015

374 ASIAN AND PACIFIC MIGRATION JOURNAL

TABLE 2
NUMBER OF FOREIGN TRAINEES BY INDUSTRY
Industry Percent
Manufacturing 83 % (total)
Automobile 39 % (of mfg.)
Electronics 16
Steel 13
Metal 12
Machine 4
Chemical 2
Food Processing 2
Other 11
Service 9
Construction 6
Agriculture / Forestry 2
SOURCE: Komai, 1991.

In its guidelines, the Ministry of Justice only indicates that “the amount of
the allowance should not go beyond the level of common sense” (Japan,
Ministry of Justice, 1991:6). Trainees are heavily concentrated in the
manufacturing sector (Table 2). According to Komai, 83.3 percent of
trainees were engaged in the manufacturing and 10.1 percent were in
construction. There are also some agricultural farms which receive train-
ees, reflecting labor shortages in that sector. About 50 percent of the
receiving companies are small (100 employees or less), and 24 percent are
of medium size (between 101 and 300 employees). With regard to the
duration of training, one-year is the most prevalent period, followed by six
months and three months.

Receiving Channels of Trainees

There are four distinct ways through which trainees are received: (1)
through governmental agencies and international organizations; (2) di-
rectly through private corporations; (3) through intermediary organiza-
tions; and (4) through the Japan International Training Cooperation Orga-
nization (JITCO).

Governmental Agencies and International Organizations

The governmental and international channels are characterized by the least

number of legal restrictions. There are no restrictions on the receiving
organizations in terms of the ratio of trainees to full-time employees. The

Downloaded from amj.sagepub.com by guest on March 24, 2015

JAPANESE IMMIGRATION POLICY IN DILEMMA 375

receiving organizations are, however, limited to: (1) national or local

government agencies; (2) the Japan National Tourist Organization; (3) the
Japan International Cooperation Agency; (4) the Technology Research
Center of the Japan Petroleum Development Corporation; (5) the Japan
Vocational Ability Development Association; (6) the Association for Over-
seas Technical Scholarship; (7) international organizations (e.g. the ILO
Association, UNIDO, UNESCO, FAO, etc.); and (8) several other organiza-
tions in exceptional cases. The most notable characteristic of this govern-
mental channel is the high-profile of the trainees. Most of the trainees
arriving through this channel have a relatively good educational back-
ground compared with those arriving through other channels. This is due
to the high standards set by receiving organizations as requirements for
trainees. For example, the Association for Overseas Technical Scholarship
(AOTS) only accepts those who hold a university degree or equivalent
professional experience in managerial and/or supervisory posts, and who
are expected to take a leading position at their workplace upon return.
Among the governmental channels, the role of municipal governments
is increasing. A growing number of municipal governments directly
receive trainees or support private industries to receive trainees. In both
cases, the trainees come mainly from the municipalities’ “sister cities” in
China which have signed agreements on promoting cultural exchanges
and technical cooperation. According to a survey of the Japan Institute of
Labor, the employment nature of training can be observed in many cases
where the municipal governments assist private corporations to receive
trainees (Japan Institute of Labor, 1994).

Private Corporations

This channel is used principally by the growing number of corporations

which receive trainees for their subsidiaries or joint venture companies
overseas. The trainees accepted through this channel must satisfy one of
several conditions. They must be: (1) full-time employees of a Japanese
subsidiary or joint venture company; (2) persons to be employed by a soon-
to-be-established Japanese subsidiary or joint venture company; (3) full-
time employees of a “business partner”; or (4) employees of government,
central bank or international organizations. To be qualified as an employee
of a subsidiary or joint venture company, more than 20 percent of the
company’s capital subscription has to be held by receiving companies in
Japan. In the case of a “business partner,” the receiving company has to
have had business transactions over one billion yen with the sending
company over the past year. This indicates that in reality this direct private
channel is limited to large enterprises. The permissible number of trainees
differs depending on the size of the receiving company.

Downloaded from amj.sagepub.com by guest on March 24, 2015

376 ASIAN AND PACIFIC MIGRATION JOURNAL

Intermediary Organizations

The acceptance of trainees through an intermediary organization generally

is used by small- and medium-sized companies as well as agricultural
farms. These companies and farmers are those which are too small to have
subsidiaries or joint venture companies overseas and not qualified for
accepting trainees directly. The acceptance through intermediary organi-
zations is beneficial for these companies or farmers since they can obtain
advisory services and know-how for legal and technical matters on receiv-
ing trainees.
There are a number of organizations which engage in intermediary
activities. Possible choices are: (1) Chambers of Commerce and Industry;
(2) Societies of Commerce and Industry; (3) small enterprise associations;
(4) non-profit organizations recognized by the government; (5) corporate
vocational training organizations; and (6) corporate vocational training
foundations. These organizations are required to receive financial and/or
other kinds of assistance from national or municipal governments, and are
subject to their guidance and regulations. Different requirements and
conditions must be fulfilled for using each intermediary organization.
For farmers, only two channels are available to receive trainees — non-
profit organizations for agricultural cooperation which are officially des-
ignated, and agricultural cooperatives. In order to receive trainees, farmers
must be members of either of these organizations.

The Japan International Training Cooperation Organization (JITCO)

Companies can also receive trainees if they are able to obtain an appropri-
ate recommendation from JITCO and recognition from the Minister of
Justice. To be recommended by JITCO, a company still has to meet several
criteria. First, in receiving trainees directly from a sending company, the
company must be either a small- or medium-sized enterprise as officially
designated. Secondly, a company must either hold a “business partner-
ship” or “technological cooperation agreement” with a sending company.
Thirdly, the company must be registered at JITCO as a supporting member.

Evaluation of the Japanese Training System

To what extent does the Japanese training system fulfill its objectives? Does
it satisfy trainees? With respect to the training programs operated by
governmental agencies such as JICA, AOTS, and the ILO Association, the
quality and content of the program has been regarded positively by
trainees. According to the ILO Association’s survey, 84 percent of their

Downloaded from amj.sagepub.com by guest on March 24, 2015

JAPANESE IMMIGRATION POLICY IN DILEMMA 377

former trainees answered that the training was useful for their current
work, and 97 percent of them would like to return and receive further
training (Heiwa Keizai Keikaku Kaigi, 1990). The JICA and AOTS also have
received positive feedback from trainees. These successful programs were
subsidized amply by the national government and were also very well
structured and organized in terms of their content. They also provide a
substantial amount of language classes and theoretical courses. When the
program includes on-the-job training at a private enterprise, these agencies
ensure that its training conditions, living standards and occupational
safety measures are adequate.
On the other hand, training programs operated by private enterprises
are rather problematic. According to a small survey organized by a Chinese
trade union on Chinese trainees in Japan, more than half of the respondents
answered that they did not receive training but were used as menial labor
(NHK News, 1993). The author’s interviews with trainees in Japan in
January 1994 also confirmed this observation. Thus in many cases of
private recruitment of trainees, the reality of “training” does not seem to
correspond with the official objective of the training system which is to
provide trainees with the skills or knowledge which are impossible to
acquire in their home countries.
In part, this negative reaction from trainees is associated with employ-
ers’ intentions for them. Many employers regard trainees as substitute
labor. Many firms have had difficulties in hiring Japanese workers even
during the recession. Labor shortages have already reached the point that
small companies could not survive without hiring foreign workers or
trainees. According to a survey by the Japan Institute of Labor, about 80
percent of local business associations chose labor shortages as one of the
reasons for receiving trainees (Japan Institute of Labor, 1994). The findings
of Komai’s (1992:7) survey were also in line with this result. In his sample
of small- and medium-sized enterprises nationwide, 56 percent of the
companies received trainees more or less to satisfy labor shortages. His
survey also revealed that 45.6 percent of the companies conducted “over-
time training” which is unlawful under the current regulations. Komai
concluded that 72 percent of the companies examined could be suspected
of providing disguised employment. When trainees are used as workers
they become cheap labor since companies need not pay them normal
salaries. Even though accommodation is provided by companies, trainees
receive only between US$500 and US$800 as monthly allowance, which is
quite low by Japanese standards. According to the Japan Chamber of
Commerce and Industry, the standard cost of accepting one trainee is
1,700,000 yen (US$17,000) per year including airfare and other miscella-
neous costs (Japan Chamber of Commerce and Industry, 1991:36). This is
about two-thirds of the annual salary of a Japanese freshman worker with
a high school degree. The total costs incurred in receiving trainees is in fact

Downloaded from amj.sagepub.com by guest on March 24, 2015

378 ASIAN AND PACIFIC MIGRATION JOURNAL

even lower, since companies do not have to pay the social security levy as
is required when they hire Japanese or even foreign workers.
Besides filling in labor shortages, there is another important objective
for companies which accept trainees — gaining a foothold for their business
expansion overseas. The survey by the Japan Institute of Labor showed that
77 percent of local business associations answered that they received
trainees in order to gain access to business operations overseas in the
future. Many of them, for example, consider China as a promising country
for future investment. Their use of trainees from China helps them to
identify appropriate firms with which they could establish business part-
nerships. In fact, trainees accepted by small- and medium-sized enterprises
through Chambers of Commerce and Industry are almost exclusively
Chinese.
Thus, contrary to the official objectives of training programs, it seems
clear that economic incentives and needs often surpass the altruism of
international cooperation as far as the training initiated by private indus-
tries is concerned. This tendency seems to have been accelerated even
further since new ministerial ordinances made the acceptance of trainees
easier for small- and medium-sized enterprises.
For a further assessment of the training system, more comprehensive
surveys are required. A survey of the Technical Intern Training Program
is especially needed to examine its effectiveness, including whether its
initial objective has been fulfilled appropriately.

Major Obstacles to Effective Implementation

There exist a number of obstacles which hinder effective implementation

of the training programs. This section will highlight some of these impedi-
ments.

Economic and Social Costs on the Part of Receiving Companies

Despite the above-mentioned economic benefits, the training system is not

entirely profitable for employers. The government decrees stipulate that at
least one-third of the training period must be spent in off-the-job training,
except for cases where trainees had already been provided with prelimi-
nary training in their home country. Trainees, if not proceeding to the
Technical Intern Training Program, are normally allowed to stay for only
one year. Therefore, after providing language courses for the first four
months, which incurs high costs, employers can benefit for only eight
months from the labor of trainees. It has often been the case that trainees
have to leave by the time they became familiar with the work. The TITP
partially alleviated this problem by extending training for one more year

Downloaded from amj.sagepub.com by guest on March 24, 2015

JAPANESE IMMIGRATION POLICY IN DILEMMA 379

and enabling receiving companies to benefit from returns of their human

capital investment in trainees. The best solution might be the use of Official
Development Assistance. If Japanese ODA establishes training institutions
in developing countries to provide off-the-job training, it would alleviate
the financial burden associated with off-the-job training for the companies,
and also would be more cost effective for the government relative to
subsidizing training programs in Japan. Another problem concerns the
instructors of trainees. The Ministerial Ordinance No.16 of 1990 stipulates
that companies must assign an instructor who possesses at least five years
of work experience. However, this is difficult for small companies. Assign-
ing one experienced worker who devotes all his/her time to training
instead of working incurs considerable opportunity costs for small compa-
nies. Furthermore, most instructors are not formally trained as instructors.
They have no license or certificate in teaching or training and are not used
to communicating with foreigners. The communication gap which origi-
nates from the language difference is often pointed out. The ILO Association’s
survey highlighted the need of language training (in English) for instruc-
tors (Heiwa Keizai Keikaku Kaigi, 1990:9). Only a few governmental
agencies such as AOTS and JITCO conduct training for instructors in
language, education and occupational safety, albeit to a very limited
extent.
Securing accommodation and training facilities is also an issue to be
raised. The ministerial ordinance required companies to secure accommo-
dation and training facilities. Small companies find it difficult to fulfill
these requirements for cost reasons. In fact, one survey showed that about
70 percent of the companies in Yokohama hesitated to accept trainees due
to the lack of accommodation and/or training facilities (Mainichi Shimbun,
July 15, 1991). Whereas JITCO is making an effort to facilitate access to local
public vocational training centers during the off-the-job training period,
the accommodation problem seems to be more difficult to tackle.
Furthermore, social costs cannot be neglected. Receiving companies
are required by ministerial decree to assign one of their employees as a “life
adviser” for trainees. The life adviser is, in principle, responsible for all
aspects of trainees’ daily life, which is often a burdensome duty. In
addition, accommodating cultural differences in the workplace, i.e. work
attitudes, religious habits, etc., is not easy for Japanese employers and
employees who have had little exposure to foreigners in the past. Commu-
nication problems are also widely observed. Many companies have to
create their own manuals or guidelines in the trainees’ language to explain
the details of work involved and occupational safety. Some employers
indicate that the total cost of receiving trainees, including social costs, is
almost as much as the cost of hiring Japanese workers (Asahi Evening News,
July 13, 1994).

Downloaded from amj.sagepub.com by guest on March 24, 2015

380 ASIAN AND PACIFIC MIGRATION JOURNAL

Mismatch Between Needs and Expectations

Many officials in intermediary organizations and companies acknowledge

the mismatch of needs between trainees and receiving companies. It seems
that there are two types of mismatches: the qualifications of trainees do not
match the skill training offered by companies, and/or the skills which
trainees expected to learn cannot be offered by the companies.
The first type of mismatch problems can be attributed to miscommu-
nications between sending organizations in trainees’ home countries and
Japanese companies. For cost reasons, many receiving companies in Japan
entrust sending organizations with the selection of qualified trainees
instead of meeting the candidates and selecting appropriate persons
themselves. For sending organizations, it is rather difficult to select trainees
whose qualifications match exactly the needs of Japanese companies
mainly due to the technology gap. There are also strong pressures in
developing countries to send as many trainees as possible in order to
benefit from technology transfer and human resources development.
Financial incentives are another significant factor. In addition to
earning hard currency in the form of trainees’ remittances, trainee-sending
governments are making profits through intermediary agencies which
charge prospective trainees high commission fees for matching services.
This reinforces their attempt to send a maximum number of trainees, even
if qualifications are not adequate.
The second type of mismatch is due to the gap between the expectation
level of trainees and the intention of employers. Many trainees, who are
often competitively selected and have high expectations for training, get
disappointed since they cannot acquire the skill which they seek. These
cases emerge when receiving companies intend to use trainees as menial
labor.

Technology Gap

Even when skill training is provided properly, the wide technology gap
between sending countries and Japan often hinders the effective use of
acquired skills. Many cases have been reported where the technology that
trainees learned in Japan is not in use in their home countries. Governmen-
tal agencies such as JICA, for example, occasionally send the appropriate
machines or equipment to trainees’ home countries. However, such cases
are extremely limited in number.
Some employers, especially those who do not provide sufficient
training, insist that training does not only refer to technology transfer. They
argue that training will be useful in terms of having an opportunity to be

Downloaded from amj.sagepub.com by guest on March 24, 2015

JAPANESE IMMIGRATION POLICY IN DILEMMA 381

acquainted with Japanese work ethics, management style and teamwork

spirit which might be even more important for trainees in the long run. This
argument has some validity since skill acquisition is not the only objective
of the training program. Nevertheless, this logic cannot be used as an
excuse for using trainees as menial labor.

Length of Training

The current training framework, including TITP, allows trainees to stay for
a maximum of two years. However, there is an argument among receiving
companies that two years is not sufficient to transfer technology to trainees.
Some maintain that it takes over five years to train a capable technician. It
seems legitimate to argue that mastering skills is a time-consuming pro-
cess. In addition, the necessary period of training might also differ,
depending on the types of skills. Yet, the current scheme does not allow
flexibility. Moreover, once they return to their home countries, technical
interns are prohibited from returning to Japan as trainees. Many of them
wish to come back to Japan for follow-up training. The ILO Association’s
survey indicated that 97 percent of their former trainees showed an interest
in returning to Japan for further training (Heiwa Keizai Keikaku Kaigi,
1989:59).
The extension of the training period is a problematic issue since it
involves the question of family reunification and possibly settlement.
Nevertheless, from the long-term perspective of human resource develop-
ment, offering another chance of training to former trainees may have
positive effects on both individuals and their countries if training is
properly provided.

Assurance of Trainees’ Return

Up to the present, no effective measures have been taken to administer the

return of trainees. The responsibility of ensuring their return is solely
placed upon receiving companies. Nevertheless it is sometimes difficult for
companies to guarantee trainees’ return since their control over trainees is
limited. In reality, some dropout and runaway cases have been reported.
Trainees, if they are used as menial labor, may find it tempting to run away
since it is financially more rewarding to work as illegal workers and receive
a salary than to stay as trainees and have to be content with a small
allowance. This is especially applicable to the cases where trainees come
from the countries which have not concluded official agreements with
JITCO concerning the dispatch of their nationals as trainees.4 For instance,

4
The countries which have concluded official agreements with JITCO include China,
Indonesia, the Philippines, Peru, Thailand and Vietnam.

Downloaded from amj.sagepub.com by guest on March 24, 2015

382 ASIAN AND PACIFIC MIGRATION JOURNAL

Bangladeshi trainees are already in debt prior to their arrival in Japan. They
have to pay the private recruitment agency a substantial commission fee
($5,000 on average) to be sent to Japan, which can be hardly offset by their
trainee allowance alone for one year.
Having guaranteed the appropriate remuneration, the Technical In-
tern Training Program might prevent these cases. Yet, its effectiveness is
limited since those in the TITP comprise only a fraction in number and vast
majority of trainees are engaged in the conventional training program.

Sending Country Source of Trainees

Except for a few governmentally-supported programs, the current Japa-

nese training system tends to assist Japanese enterprises to train the staff
of their overseas subsidiaries and joint venture companies. This is largely
due to the difficulty in finding receiving companies which would provide
training. Given that the training cost for one trainee is between US$15,000
and US$20,000 per year, it is highly unlikely that private enterprises would
be willing to receive trainees every year without expecting commensurate
economic returns. For that reason, in part, the government introduced the
new Technical Intern Training Program to offset costs by enabling the
companies to employ trainees as “interns” after their initial training. The
government also has subsidized training programs from its ODA budget
through intermediary organizations to alleviate the financial burden that
training programs impose on companies. In other words, ODA is used
partially to serve the interests of these companies.
Although training local staff of Japanese overseas subsidiaries still
contributes to the human resources development of that country in a broad
sense, training opportunities should not be provided preferentially to
those affiliated with Japanese corporations since the training program is
officially open to the general population in developing countries. More-
over, it would be more effective to train those who could use their acquired
knowledge and skills in the indigenous enterprises, given that such enter-
prises may have a greater developmental impact on the sending countries.

Discussion

Although the official aim of Japan’s training programs is to contribute to

technology transfer and human resources development, the current train-
ing initiated by private industries does not always fulfill this objective.
From the available survey results, it is clear that many employers consider
the training system as a means of obtaining substitute labor and access to
future business. The newly established Technical Intern Training Program
is not an exception. While the program was launched within a framework

Downloaded from amj.sagepub.com by guest on March 24, 2015

JAPANESE IMMIGRATION POLICY IN DILEMMA 383

of international cooperation, it is widely perceived as the first official

attempt to legalize the entry of unskilled and semi-skilled workers into the
labor market. It officially added an employment contract under the name
of “technical internship.” This represents a significant change in Japanese
immigration policy which had long refused to allow any kind of employ-
ment for unskilled and semi-skilled foreign workers.
The TITP has made a number of improvements in the previous training
system in terms of protecting technical interns as workers and controlling
the quality of training. Nevertheless, there remains a number of problems
associated with the TITP, as well as with the conventional training scheme.
These problems largely derive from the ambiguous nature of the current
immigration policy. While firmly refusing to take in unskilled and semi-
skilled foreign labor, it overlooks the de facto intake of such labor in the
form of trainees. Many companies regard the training system as the only
loophole for obtaining needed labor. The TITP is, in this sense, a product
of political compromise which more or less satisfies the interests of
different parties concerned: the Japanese government in favor of holding
the principle of the current immigration policy; Japanese companies in
need of labor as well as a foothold for their future business overseas; send-
ing countries interested in developing their own human resources as well
as gaining foreign currencies; and trainees who wish to acquire new skills
and earn money.
Nevertheless, the current training system is not a fundamental solution
to the problem of labor shortage in the long run. Sending countries cannot
benefit from the expected technology transfer and human resource devel-
opment if trainees cannot acquire the skills that are useful to them when
they return. In addition, the abusive treatment of their citizens is becoming
a serious concern to the sending governments.
The benefits for Japanese companies are considerably limited. The
duration of training, including the TITP, is limited to only two years. This
makes it difficult for small- and medium-sized companies to train their
trainees as “core workers” who will acquire skills, accumulate experiences,
and gradually take over seniors’ responsibilities at the workplace. While
employees of entry-level jobs are constantly replaced by new trainees and
interns, the aging of the core work force will still continue and eventually
endanger the survival of the companies. In this respect, the present training
system has the same implication as the rotating labor system adopted by
some European countries in the 1960s.
As long as such a strong demand for labor exists, the formal objectives
of training programs will be difficult to achieve. However, labor shortages
in certain industrial sectors are not transient, but structural in nature.
Economic fluctuations affect but do not eliminate the shortages. Many
small- and medium-sized companies experience difficulties in attracting
young Japanese nationals even though they provide adequate salaries.

Downloaded from amj.sagepub.com by guest on March 24, 2015

384 ASIAN AND PACIFIC MIGRATION JOURNAL

It does not appear that this labor market condition will improve. One
significant reason is a demographic shift in Japan. With a rapidly declining
birth rate, it is predicted that there will be a shortage of 1.8 million workers
by 2010 (Japan, Ministry of Labor, 1990; cited in Nihon Keizai Shimbun, June
1, 1990), even under the assumption that the labor force participation rate
of women increases drastically. Even if the labor force participation rate of
women were to rise, it seems implausible that women will fill 3D jobs unless
working conditions and the social environment improves radically.
It seems to be a matter of time before strong requests will emerge from
companies to convert these “trainees” and “technical interns” into regular
workers, or simply to import semi- or unskilled foreign labor to fill the
vacancies in the core work force. As far as the manufacturing industry is
concerned, this debate is also a question of whether the sangyo-kudoka
process (the “hollowing out” of industry) should be accelerated with all the
principal manufacturing bases moving overseas and small companies
fading away. For non-traded industries such as construction and services,
securing an adequate labor force is an even more critical issue since they
cannot move overseas. In other words, the direction of policy towards the
training system can in part determine the future of industrial structure.

Conclusion

The current training schemes would appear to require some reform. Above
all, recourse to legal action should be available to protect trainees from
abuses. One of the imminent measures which could be taken is to provide
trainees with the legal status of workers not only during the technical
internship, but also during the conventional training. Since the employ-
ment aspect exists in training, trainees should be appropriately remuner-
ated. The most important point is to establish a clear national consensus,
prior to any kind of decisions to be made, on whether or not Japan should
accept unskilled and semi-skilled foreign labor in the long term, and reflect
this in immigration policy. If the answer is positive, prompt actions should
be taken to adjust the policy change, including the setting up of the
appropriate social infrastructure and legal system. If the answer is nega-
tive, effective measures should be pursued to cope with labor shortages.
The revisions of the existing training scheme on an ad hoc basis will not
solve Japan’s fundamental labor problems. The immigration policy should
reflect reality in formulating its long-term vision, and implement it accord-
ingly. Since training is conducted under the framework of international
cooperation, it should fulfill its functions properly and not put into
question the mutual trust between Japan and trainee-sending countries.

Downloaded from amj.sagepub.com by guest on March 24, 2015

JAPANESE IMMIGRATION POLICY IN DILEMMA 385

REFERENCES
Heiwa Keizai Keikaku Kaigi
1990 Ajia taiheiyou shokoku no gijutsu kenshusei ukeire to gijyutsuiten/gijyutsukyoryoku
(Acceptance of Technical Interns, Technological Transfer and Technical Cooperation in
Asian and Pacific Countries). Tokyo: Kikaishinkokyokai Keizai Kenkyujo.

Japan Chamber of Commerce and Industry

1991 The JCCI’s Guide Book for Receiving Foreign Trainees. Tokyo: Japan Chamber of Commerce
and Industry.

Japan Institute of Labor

1994 Jichitai ni okeru Gaikokujin kenshusei ukeire jigyo (Reception of Foreign Trainees in
Municipal Governments). Tokyo: Japan Institute of Labor.

Japan, Ministry of Justice

1993 “The Immigration Control and Refugee Recognition Act (including Ministerial
Ordinances).” In Jitsumu Roppo (The Compendium of Laws). Tokyo: Nihonkajo Shuppan.

1991 “The Acceptance of Foreign Trainees.” In Kokusaijinryu. Tokyo: Nyukan Kyokai.

Japan, Ministry of Labor

1994 Situation of Implementation of the Technical Intern Training Program. Tokyo: Ministry of
Labor.

Komai, Hiroshi
1992 “Are Foreign Trainees in Japan Disguised Cheap Laborers?” Migration World, 20(1).

1991 Gaikokujinrodosha no roudou oyobi seikatsujittai ni kansuru kenkyu — Kenshuseino bunseki

(Research on Labor and Life Conditions of Foreign Workers — Analysis of Trainees).
Tsukuba: Tsukuba University.

NHK News
1993 “The Unsatisfied Trainees,” Nihon Hoso Kyokai, 28 November, Tokyo.

Ochiai, Hideaki
1975 Ajiajin Rodoryoku yunyu (Labor Import of Asians). Tokyo: Gendaihyoronsha.

Oishi, Nana
1995 “International Migration for Training: The Japanese Experience.” In Training Abroad:
German and Japanese Schemes for Workers from Transition Economies or Developing Countries.
By C. Kuptsch and N. Oishi. International Migration Paper No.3. Geneva: International
Labor Office.

Organization for Economic Co-operation and Development

1975 Economic Surveys: Japan. Paris: OECD

Pang, Eng Fong

1993 Regionalization and Labor Flows in Pacific Asia. Paris: OECD Development Center.

Downloaded from amj.sagepub.com by guest on March 24, 2015