Adoption of Sign-on Bonuses Across Multiple Industries
In recent years, Japanese companies have increasingly adopted sign-on bonus strategies to address talent shortages. This practice, initially common in manufacturing industries such as automotive, primarily targeting temporary factory workers with bonuses typically ranging from a few hundred thousand yen, has now expanded. As the competition for talent intensifies, sign-on bonuses have spread to IT, service industries, and other sectors, with amounts steadily rising.
According to data from the major recruitment platform “doda,” job listings offering sign-on bonuses in 2023 increased 5.8-fold compared to 2018. While specific recruitment numbers remain undisclosed, the number of job listings is estimated to be in the thousands.
High Bonuses to Attract Talent
Some companies are offering sign-on bonuses as high as 1 million yen (approximately $6,700). For instance, SOLIZE offers a 1 million yen sign-on bonus to experienced IT engineers with annual incomes exceeding 7 million yen. SHIFT also provides an equivalent bonus to new employees with annual incomes of 5 million yen or more.
This trend is not limited to the IT sector. Consulting giant Accenture offers approximately 500,000 yen in sign-on bonuses for recruitment at certain local branches. Ohsho Food Service Corporation provides about 300,000 yen to part-time or temporary workers transitioning to full-time positions. West Japan Railway Company offers a 100,000 yen sign-on bonus to newly hired bus drivers, along with a continuous employment bonus system.
Multiple Purposes of Sign-on Bonuses
Companies adopt sign-on bonus strategies for various reasons. Primarily, it helps them stand out in the fierce competition for talent. Additionally, sign-on bonuses can compensate for income reductions due to job changes and cover the costs of learning new skills in advance. For companies, sign-on bonuses represent a smaller financial burden compared to permanent increases in base salaries, making them more accessible for small and medium-sized enterprises.
Attractiveness to Job Seekers
Sign-on bonuses are particularly appealing to job seekers, especially younger ones. In Japan, annual incomes and starting salaries for experienced workers continue to rise. Recruit’s data shows that in fiscal year 2023, 35% of job changers saw their salaries increase by more than 10% after changing jobs, a historic high. In this context, sign-on bonuses provide additional financial incentives for job seekers.
Expert Opinion
Yuki Kobayashi, Senior Principal Researcher at PERSOL Research Institute, notes that sign-on bonuses are likely to become more prevalent in industries with high employee mobility. However, she emphasizes that to retain acquired talent, companies need to continue investing in education and implement ongoing improvements in employee benefits after hiring.
Key Points:
Japanese companies widely adopt sign-on bonus strategies to address talent shortages
Sign-on bonus amounts are increasing, reaching up to 1 million yen in some cases
The application of sign-on bonuses has expanded from manufacturing to IT, service industries, and other sectors
Sign-on bonuses are attractive to both companies and job seekers, but need to be complemented with other measures to retain talent
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