Japan’s bid to lure foreign workers will be restricted

Significance

Although government efforts including a new visa programme and intern programme have contributed towards rising inflows of foreign workers that have partially eased labour shortages, social, cultural and economic factors continue to limit immigration.

Impacts

• More foreign workers and competition with other countries to attract and retain them will raise wages and inflationary pressures.
• Eased labour shortages will encourage multinational companies to invest in Japan.
• Rising demand from overseas workers will drive imports of goods and services.
• An outflux of workers to Japan and other developed countries will curb growth in Asian economies including Vietnam and the Philippines.