International social infrastructure key to Japan’s high-tech future

Kyushu and Hokkaido are well-positioned to lead Japan’s next high-tech revolution.

Having already attracted data centers and multibillion-dollar investments in cutting-edge semiconductor facilities, their local economies stand to benefit greatly from a forthcoming AI revolution. But Japan’s labor force shortages, especially in high-tech industries, and uneven international social infrastructure may pose challenges for fully realizing these regional economies’ revitalization ambitions.

The world’s high regard for Japan’s soft power — cuisine, culture and creativity — attracted 25 million tourists last year, according to The Japan Times. These same pull factors should also help attract foreign workers to Japan; but creating the conditions necessary to spur long-term relocations rather than short-term stays will require greater investment in international social infrastructure.

Across the globe there is an ongoing search for talent, especially in high-tech sectors. Wages are one factor, but skilled workers also look at the full range of services available to them and their families when making overseas career decisions. Those cities winning the search for talent are those where international professionals and their families can integrate into the local community and thrive.

In Japan, Tokyo, Yokohama and Osaka are consistently listed in international surveys such as the Mercer Quality of Living ranking among the top cities in Asia for their safety, infrastructure, cultural offerings and excellent health care and education. While both Fukuoka and Sapporo are often cited by Japanese as among the country’s most desirable domestic cities to live in, neither makes Mercer’s global list, suggesting that they are not yet on the radar of many expats from overseas.

The government recently designated Hokkaido Prefecture and its capital, Sapporo, as well as Fukuoka, in addition to Tokyo and Osaka, as special zones for financial and asset management businesses. Additionally, Kumamoto Prefecture was named a national strategic zone for semiconductors. This will create a more welcoming investment climate by making it possible to accomplish more administrative procedures in English and relaxing residency rules for foreign investors and entrepreneurs.

At the prefectural and municipal levels, local governments have already launched commendable initiatives to attract and welcome skilled workers and their families. The Hokkaido Prefectural Government has reformed its organizational structure to create three sections to manage its relationship with foreign companies, foreign residents — including workers who come from overseas — and subnational entities.

Sapporo likewise has increased its internationally focused staff by 40%, shifting its emphasis from maintaining sister city relationships to supporting global economic ties. In Kyushu, Kumamoto Prefecture has set up a team to help foreign semiconductor workers open local bank accounts, find housing and transportation, enroll children in public schools and liaise with local governments on registering for necessary services.

However, based on anecdotal feedback from prospective investors and expats already living in Japan, much more is still needed to fast track and enable smooth entry and integration of foreign labor talent.

What would make Kyushu and Hokkaido more attractive to international talent? More English-based social services would support high-skilled labor from around the world. Upgraded and expat friendly international medical clinics with multilingual services would better meet family health care needs. In addition, diversifying educational options, including establishing a greater number of international schools, would also be a plus.

Emergency and social service providers should also be able to respond in languages other than Japanese. Another issue is finding adequate child care, which is challenging enough for Japanese citizens but even more so for expat families due to the language barrier. Banks should simplify processes for setting up accounts and online bill pay. Finally, expanding the availability of places of worship would welcome people of all faiths.

These forms of international social infrastructure, which are standard in the worlds’ top cities for global talent, would make places like Fukuoka and Sapporo more competitive for attracting skilled workers.

Technological advancements could make these recommendations easier to carry out. AI-powered tools, in particular, could help bridge some of the implementation and communication hurdles. For example, Finland and the UAE have recently made headlines for announcing the planned integration of new AI-powered virtual assistants into government services. These virtual assistants will help expats and residents more easily navigate local and national administrative bureaucracies and regulatory requirements, including establishing residency and business investing.

Why are we, two U.S. diplomats, writing about ways to attract global talent?

Over the past few years, U.S.-Japan high-tech cooperation has reached unprecedented levels as we seek out economic opportunity and protect our economic security. Whether through the new University Partnership for Workforce Advancement and Research & Development in Semiconductors (UPWARDS) for the Future program, which unites U.S. and Japanese companies with 11 leading universities, or a new U.S. Department of Labor workforce development program focused on sustainable semiconductor and advanced manufacturing talent pipelines, we aim to support this collaboration. Through these and other high-tech initiatives, we want to make each of our countries more accessible to our top talent and their families.

Japan’s dedication to transparency and the rule of law makes it an ideal destination for high-skilled foreign workers. By developing matching world-class international social infrastructure, areas like Kyushu and Hokkaido can supercharge their economic development and regional revitalization plans.

As the Rolling Stones famously sang, “Time waits for no one.” And this is exactly the case in the global competition for top talent. Being competitive will require quick and pragmatic action for Japan to realize its ambitious high-tech goals.