Job in Japan 5 - Impossible to terminate and mobility shifts

Hi there! I’m Aki, a Japanese former HR head from the global finance industry. Japan’s employment scene has flipped in recent years—and it’s a huge win for foreigners! A shrinking workforce is one driver, but it’s not the only one. Job mobility’s up, protections are rock-solid, and opportunities are ripe. Let’s dive in!

1. Increasing Job Mobility

Back around 2000, Japan was still licking wounds from the post-bubble crash. Lifetime employment (shushin koyo) ruled—especially at big firms—and job mobility was low. Loyalty, seniority, and stability trumped all; only about 10-12% of workers switched jobs yearly (Ministry of Labor data).

Fast-forward to 2025, and it’s a different game. Globalization, an aging population (labor shortages galore), digital shifts, and reforms like former Prime Minister’s reskilling push have cranked mobility up. Gen Z and Millennials chase flexibility over loyalty, and job-based hiring’s on the rise. Today’s grads switch 2-3 times by 30—unthinkable in 2000’s 0-1 norm.

Recent trends peg the job separation rate at 15-18% by 2023-2024 (JILPT, Cabinet Office), with 2025 likely hitting 18-20%. Compared to the U.S.’s 20-25%, we’ve still got ground to cover—but we’ve come far!

The mindset’s flipped too—from “loyalty and seniority” to “cross-pollination, globalization, and life purpose.” At Japanese firms back then, we called new-grad hires “proper employees” (sometimes jokingly “purebred), giving them an edge over lateral hires. It fueled that “I’ve worked here longer than you” vibe—yikes. Now, even Japanese companies lean performance-based, shedding old baggage.

2. Job-Based vs. Membership-Based Hiring

Membership-based hiring—where new grads get trained, shuffled across departments, and ranked by grad-year seniority—is fading at Japanese firms. Even the government’s nudging mobility, tweaking retirement allowance taxes that once favored long tenure. Foreigners love this—flexibility beats the old “one-company” trap.

I’ve hired young Japanese talent from local firms whose salaries doubled with a switch—no seniority strings attached. The beauty of lateral hires face no demerits, acclimate fast, and snag more opportunities. Plus, you skip tolerating less-capable seniors clinging to tenure.

3. Employment Dynamics: Ironclad Protections

Japanese labor law is a fortress for employees—Japanese or foreign, doesn’t matter. Courts back workers, and companies dread lawsuits. Want in? Aim for permanent employee status (seishain)—security’s tighter. That said, contractor or intern gigs can be a foot in the door—many firms convert proven talent to permanent roles. Prove yourself, and you’re golden!

Termination? Nearly impossible—no “at-will” rule here. Unless you’re caught embezzling or breaking the law, your job’s a rock. Many firms keep underperformers because firing’s a mess. Ever hear of madogiwa-zoku—the “window-siders”? These are folks parked in office corners with little to do. Years back, I visited a firm and saw a guy asleep, face-up, mid-day—everyone saw, yet he stayed.

Instead, companies lean on Performance Improvement Plans (PIPs)—training, coaching, transfers, new projects, —to document struggles. Even then, courts often force settlements for “unfair dismissal.” Behavior issues follow the same drill—employers must try everything.

Take this case: A foreign IT guy botched a system launch and secretly tested in production—non-compliant stuff. His manager was furious, yelling “instant dismissal!” Our labor attorney and I explained: not so fast. In the review meeting, he smirked, “I know Japanese companies can’t fire me.” He was right— protections held, despite the headache. People ask me, “PIP’s the start of termination, right?” Depends—some ace it and stay; others don’t. Either way, you’ve got stuff to fix.

Or firms try “resignation recommendation”—a recommendation to leave with a package: special allowances, salary continuation, or outplacement help. It’s optional—you can refuse!  However, if you’ve got no drive to improve, taking it might open new doors. A door closed often means another’s waiting—pretty Western thinking, but many here still cling to the old ways.

4. Retirement age

Retirement age is another twist in Japan’s employment game—even at foreign firms. Most set it at 60, though some stretch to 65. Foreign HR folks often ask me, “Isn’t that age discrimination?” Legally, it’s not—it’s baked into Employment Rules and long-standing practice. After 60, many companies shift workers to contractor status until 65, not permanent roles. I’ve seen this catch expats off guard—expecting “forever” jobs, they hit a wall. It’s not all rigid, though—some firms adapt, and reforms are nudging flexibility. Still, it’s a heads-up: plan your career arc!

Wrap-Up

Mobility’s your edge, protections your shield. Let’s take advantage of it—jump smart, know your rights, and ride this wave!