Almost half, or 48% of employers in Japan believe that they will lose staff in the next six months as they seek to earn more by moving jobs, according to new research from Morgan McKinley.

The research also found that 57% of employees in Japan are looking to move jobs in the first half of the year, with 32% selecting ‘higher salary’ as their primary reason for wanting to do so, followed by ‘doing more meaningful and impactful work’ (22%).

Most, or 89%, of employers had to offer higher than anticipated salaries to attract new employees over the last 12 months. Furthermore, over half (52%) of employers in Japan think that salaries in their specific sector will rise in 2023, with 33% planning on increasing base salaries across all teams.

Meanwhile, 44% of employees in Japan are expecting their salaries to increase this year, with 70% also expecting some form of bonus payout.

Lionel Kaidatzis, Managing Director of Morgan McKinley Japan, said, “Japan is notoriously known for being a candidate-short market, but it has never been more acute than in 2022. This was due to high demand to hire, slowness of reopening borders for work visas, and a backlog of hires put on hold during Covid-19. As demand eased towards the end of the year, there was an increase in the need for contractors with specialist skills and experience, we expect that to continue throughout 2023.”

“Salaries in Japan have remained largely flat, or had little increase, for several decades now which successive governments have tried to address,” Kaidatzis said. “That said, because of such extreme demand in 2022, salary increases were seen across several functions as a result of talent shortages driving a ‘bidding war’ between companies as they sought to secure the people they needed.”