OKAZAKI, Aichi Prefecture—Even in a prefecture hosting Toyota Motor Corp. and its myriad of subcontractors, Yoshinobu Uchida finds it difficult to recruit workers for his plastic components factory.

“Few young Japanese are willing to take a factory job as the work environment is tough,” said the president of the Okazaki-based Iwadukasei. 

Iwadukasei manufactures a wide array of parts for car interior and other automotive components by feeding liquid plastic into metal molds after melting granular plastics.

Apart from supplying to Toyota and Mitsubishi Motors Corp., the company produces intercom parts and other components for five other businesses.

LOCAL HIRES BECOME SCARCE

It had been customary for Iwadukasei, which began manufacturing automotive parts in 1974, to hire two to three local high school graduates each year through the 1990s.

But after 2000, it became almost impossible, with few applying for positions on the factory floor.

The number of Japanese employees Iwadukasei hired over the past 20 years is about 10.

That left the company with no other options but to turn to technical intern trainees from Asian countries arriving in Japan on the Japanese government program to fill openings.

Iwadukasei’s workforce consists of 18 Japanese and nine technical intern trainees from Indonesia and Vietnam.

One of the nine trainees is Vina, a 24-year-old Indonesian woman who came to Japan in April after her initial plan to start her internship was significantly pushed back by the coronavirus pandemic.

Vina is from central Java, where people have only one single personal name.

Her main duty is inspecting newly made exhaust ducts for car air conditioning units for defects such as scratches, cracks or other damage.

Her current monthly net income is about 120,000 yen ($816), around four times the average monthly wages of workers back home.

She sends 40,000 yen to 60,000 yen a month to her parents in Indonesia.

Vina said she feels comfortable living in Japan and is eager to learn about the way business is done here.

“Japan is a safe country, and you will have no trouble walking around alone at night,” she said.

She said she is striving to master the so-called 4-S principles practiced at the workplace in Japan--"seiri," "seiton," "seiso," "seiketsu" (sort, set in order, shine and standardize)--so that she can introduce them when she returns to Indonesia and hopefully starts working in the textile manufacturing and sales industry.

Uchida, 52, acknowledged that like many other workplaces with foreign staff, a communication problem exists between his company's Japanese and foreign workers.

“Sometimes, what we conveyed was not accurately understood by foreign workers, creating the potential for mistakes due to miscommunication,” he said. “If we have a choice, we would rather employ Japanese.”

But he added that it will be difficult to sustain the current scope of output without foreign workers.

“Foreigners are a precious manpower resource,” he said.

WAVES OF FOREIGN LABOR STEP IN

What adds to the burden on small auto parts manufacturers such as Iwadukasei is the price competition with Japanese automakers’ factories operating in countries with low labor costs. 

Uchida said whether his business will be sustainable amid a continued decline in the Japanese population has been a long-standing concern, adding that downsizing operations is an option.

As the nation sees a shrinking pool of working-age population of 15-64 years olds, Japan’s reliance on a foreign workforce continues deepening.

In 2009, in the aftermath of the 2008 global financial crisis, one in 112 workers was a foreigner, an estimate made based on data from the internal affairs ministry and labor ministry.

In 2024, foreign workers totaled 2.3 million against Japan’s overall workforce of 67.81 million, meaning one in 29 is foreign born.

And 25 percent of foreign workers in Japan are in the manufacturing sector.

As of the end of 2024, Aichi Prefecture reported that one in 18 workers was from overseas, the second highest ratio in Japan after Tokyo, where the ratio was one in 14.

Forty percent of the foreigners in the prefecture are long-term residents, such as Japanese-Brazilians who have worked in manufacturing jobs, and permanent residents.

They are chiefly the product of the 1990 revised immigration law that allowed up to third-generation Japanese-Brazilians and foreigners of Japanese descent to work in Japan without restrictions on long-term resident visas.

But many employers stopped renewing their contracts in the wake of the 2008 financial crisis.

The next wave of foreign labor that filled factories consisted of young workers from Asian countries.

Valeria Turci Sakaguchi, 63, a Japanese-Brazilian who lives in Toyota city in the prefecture, is one of the contract workers who has been replaced by young Asians, many of them Vietnamese and Myanmar.

After arriving in Japan in 1992, Sakaguchi worked in an automotive parts factory via various job placement agencies.

But her contract was not renewed after she turned 60.

Despite working in the nation for decades, Sakaguchi is not eligible for Japan’s national pension benefits because she has not paid into the pension system.

Her employers had not paid into the system for her, either.

She said she does not recall being told about the Japanese social security system and the merits of participation by her employers.

It was initially a common practice among foreign workers not to enroll in the system to maximize their take-home pay under the assumption that they would eventually return to their home country.

Sakaguchi said how to treat foreign workers should be considered from a long-term perspective.

“I am grateful to Japan,” she said. “But if foreign workers continue to be used as cheap labor, young Asian workers will likely face the same problem we Brazilians do somewhere down the road. Their futures after they have aged should be considered.”

(This article was written by Tomonori Asada and Ari Hirayama.)