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No longer last on the list: Contracting in Japan’s financial sector is experiencing new-found popularity

Contracting has never been conventionally popular with Japan’s finance professionals, but increasingly this seems to be changing. There’s been a greater receptiveness to hiring contractors over the last two months, says a recruiter we spoke to.

Demand poised to jump 20 per cent

Contracting is becoming more popular largely because there are more hiring freezes for permanent positions as market activity declines.

Naeem Iqbal, director, contract division, Robert Walters Japan, says: “Due to headcount restrictions, banks added contract professionals to complete ongoing projects. For the remainder of 2011, professional contract demand is anticipated to increase by 15 to 20 per cent, similar to the increase in contract activity we experienced following the market downturn in 2009.”

Sought-after contract positions include junior-level helpdesk people and engineers from vendor companies, who are in demand because of outsourcing. Mid-level project managers and business analysts are also often engaged on a project basis, says Iqbal.

Mindset shift

Japanese candidates have typically exhibited a bias towards contract and temporary work, with most favouring a long-term, stable career. “Over the last five years we have witnessed this mentality shifting. Benefits of contracting such as a better work-life balance, or higher pay for specialised skills, not corporate titles, have slowly crept into the Japanese workforce as more nationals return from working or living abroad.”

The demand for contractors is surprisingly evergreen. As Iqbal explains, firms will hire them to complete projects and bypass headcount restrictions during uncertain market conditions. Conversely, he says, contract demand will be “very high” during periods of strong market activity, because more hands are needed to help alleviate the pressure of increased workloads.

Although sourcing contractors may not be as difficult these days, companies need to be careful when navigating Japanese labour laws for contractors and temporary staff. Iqbal says: “Overtime pay, insurance and working visas are all highly regulated, so some recruitment firms specialising in contract professionals have begun helping employers manage this process.”

Comments (2)

  1. Unfortunately contract pay is very poor, for the lack of benefits and uncertainity that contract work entails, contract rate be much higher then they are in Japan, basically contractors are beng cheated.

  2. @vikesh, In Japan, contracting is well regulated so pay is usually higher than permanent employees to compensate for employee benefits. Also I think many contracting work is project based so it has more flexibility with lifestyle.

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