reskilling in japan

Ai and Reskilling in Japan

Reskilling workers and  boosting the value of individuals, is vital for countries and companies to thrive amidst rapid change and innovation. Reskilling is essential for putting people at the center and making the most of their abilities.

The increasing focus on digital transformation and automation has sparked global interest in reskilling. The COVID-19 pandemic has made reskilling even more crucial due to changing work styles and the growing need for digital skills.

Challenges facing the Japanese labour market
japanese labour market


Japan’s labor market is grappling with intricate challenges that are interconnected. Low productivity, digital gaps between urban and rural areas, and discrepancies between large and small companies. Moreover, wages have remained stagnant for an extended period.

Looking into the future, Japan’s working-age population is predicted to decline to 92% of its 2020 level by 2030 and a mere 68% by 2050, indicating an inevitable scarcity of workers.

A recent study by Mitsubishi Research Institute reveals a fascinating projection: by 2030, there will be an excess of approximately 2.1 million people in traditional production and administrative roles, which used to dominate the Japanese workforce.

Reskilling the surplus workforce

Reskilling market

One key reason for this lies in Japan’s labor practices and human resource systems, which are deeply ingrained.

Traditionally, Japanese companies have embraced a lifetime employment system alongside a seniority-based wage structure. This approach involves hiring a large cohort of fresh graduates without clearly defining their roles, and subjecting them to “job rotations.”

These rotations entail regular transfers between different departments every two or three years, exposing employees to diverse fields. As a result, individuals may not feel compelled to strategically develop their careers and expertise.

The absence of clear job descriptions and prolonged exposure to various roles may deter employees from proactively building the necessary skills for the changing labor landscape.

It is evident that addressing this issue requires a shift in mindset and practices. Both companies and individuals need to recognize the value of continuous learning and reskilling to remain relevant and thrive in a rapidly evolving digital age.

Japanese companies focused on reskilling

reskilling market

Amidst Japan’s prevailing employment practices, notable progress is being made by Japanese companies in embracing change. A prime example is Mitsui Chemicals, which has embarked on a remarkable journey of digital transformation (DX) education for all 11,000 employees across its group companies in Japan.

A staggering sum of JPY 100 billion (approximately $765 million) has been earmarked for DX-related investments, with a primary focus on human resource education, by the year 2030. This substantial commitment underscores the company’s dedication to equipping its workforce with the necessary digital skills and knowledge for the future.

Another noteworthy example is SOMPO Holdings, a prominent player in the insurance industry. This forward-thinking organization has integrated a new digital business into its core operations, which encompass domestic property and casualty (P&C) insurance as well as overseas insurance.

With a keen emphasis on cultivating digital talent, SOMPO Holdings is actively engaged in developing a pool of skilled professionals equipped to navigate the digital landscape effectively.

Initiatives by Mitsui Chemicals and SOMPO Holdings exemplify the growing recognition among Japanese companies of the imperative need to adapt to the digital era. By investing in digital education and fostering a workforce well-versed in emerging technologies, these companies are positioning themselves to seize new opportunities, drive innovation, and remain competitive in an increasingly digital world.

In anticipation of an evolving landscape


where the property and casualty (P&C) insurance sector may witness a decline in the face of automated driving and sharing services, SOMPO Holdings is proactively preparing for the future. Recognizing the need to adapt, the company has set its sights on constructing a robust data platform.

This ambitious platform will form the bedrock for SOMPO Holdings’ new solutions business, leveraging the wealth of real data amassed through its insurance and nursing care operations. By harnessing this invaluable resource, the company aims to develop innovative solutions to address pressing societal challenges.

By transforming these individuals into digital human resources, the company aspires to broaden the horizons of its new business initiatives.

Embracing this strategic shift, SOMPO Holdings is positioning itself as a forward-thinking industry player, cognizant of the changing dynamics and determined to thrive amidst shifting tides. By capitalizing on their wealth of accumulated data and empowering their employees with digital acumen, the company is primed to embrace new opportunities and spearhead positive change.

Reskilling needs to be accompanied by change

As the winds of change sweep across Japan, both the government and companies are stepping up their game. In a significant move, the Japanese government announced a whopping JPY 1 trillion ($7.5 billion) investment over the next five years to reskill workers, while urging businesses to adopt more flexible pay scales.

This initiative kicks off with the development of a robust system that allows individuals to seek guidance from experts regarding their careers. It promises comprehensive support for reskilling and transitioning into new roles—a vital first step in the process.

In an era marked by rapid technological advancements, our society continually evolves, demanding new skills and transforming the way we work.

Furthermore, companies must actively collaborate with reskilling efforts, fostering an environment where individuals can fully leverage the skills they acquire in response to these changes. This entails reforming organizational structures, salary systems, and work processes.

In this transformative journey

This shift in perspective holds the promise of a brighter future for work in Japan, driving the social economy’s digitalization and greening efforts.

Amidst these advancements, one outstanding option to consider is the Aihub Academy’s education courses and training programs. With a focus on AI and DX, they offer an exceptional opportunity for individuals in Japan to acquire cutting-edge skills in these domains.

These specialized courses can empower individuals to thrive in the digital era, positioning them at the forefront of technological advancements and opening doors to exciting career prospects.

With Japan’s resolute commitment to reskilling, combined with the availability of world-class educational resources like Aihub Academy, the future looks promising. Together, we can forge a path of transformation, unleashing the true potential of individuals and driving Japan’s journey towards a digitally empowered and sustainable society.



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