Japan's Recruitment Process Outsourcing (RPO) market is not fully developed yet and expecting further growth in line with raise in its awareness.
RPO is a commonly used service in the United States, however, it does not seem to have really gotten a foothold in Japan yet. The RPO service entered into the Japanese market approximately 15 years ago. Although an increasing number of companies is using the service, we have seen some failed cases as successful approaches in the United States are not working in many cases in Japan as such US procedures do not match with Japanese corporate culture and hiring practices. A specific example is a case where a recruiter of RPO service is being merely seconded to a client, just like dispatching a staff to a client, and is not fulfilling the original role as an RPO recruiter.
However, we are a subsidiary of en japan, a pioneer in the HR space in Japan, and are well versed in the Japanese market. For this reason, while we have been targeting foreign capital companies and global Japanese companies, we have been able to achieve consistent growth since the launch of our service in 2017 and have been delivering strong results so far in 2019 as we have been deploying customized services tailored to the needs of our customers. Currently, companies in various fields are showing strong interest in the RPO service, thus, we expect the RPO market to expand in Japan along with these trends going forward.
The market surrounding talent has been changed largely over the last several years. Employers need to be flexible and equip themselves to win talent acquisition battles.
Major challenges such as talent shortages and corporations facing difficulty in hiring are background factors for pushing the growth of the RPO service. It is a well known fact that talent is short supply in the market, and what I would like to emphasize is that lately the recruitment process of companies has not been able to respond to changes in the market. For example, along with the widespread use of social media, companies have more options for talent acquisition activities besides using traditional head hunting and media specialize in job placement. Furthermore, candidates have a better capability in information gathering than before, and various information they come across in their daily lives can be one of factors for deciding on career transition.
In the United States, there are some markets where once companies post jobs, they can get applications from candidates as a natural sequence. However, in Japan, companies are in a situation where they still need to reach out first to candidates as they cannot find talent. We think hiring difficulties are likely to continue in 2020 and beyond. Awareness of RPO services is gradually increasing, and accordingly companies using RPO service have been on the rise. Rather than sticking to traditional recruiting approaches, companies should try out various talent acquisition services such as HR technology and RPO, making efforts for finding some suitable hiring approaches that fit with their corporate culture and improve success rates, otherwise they would face difficulty in securing top talent.
Reflections on recruiting global talent for 2019 and prospects for 2020_en world Japan_20191205
en world Japan K.K.
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