Internships -- slave labor or a worthwhile experience?

By Terrie Lloyd

TOKYO —

A major staffing company called FujiStaff Holdings has just set up a new subsidiary, called Inter Agent, which will find internships at Japanese firms for foreign students. Inter Agent is apparently wanting to take advantage of the fact that there are around 130,000 foreign students studying in Japan at any given time and many of them want to stay on and get jobs after they graduate.

The timing is such that those larger companies which are on a major globalization push are obviously going to be looking for Japanese-speaking foreigners who can learn the company’s methods and processes, and eventually get assigned positions in that firm’s holdings abroad. As an example, Panasonic has said that next spring it plans for 80% of its new hires to be from applicants who are non-Japanese.

Actually, staffing giant Pasona Group started a similar business back in 1988, helping Westerners studying in Japan to find work experience at Japanese firms. In 2007, they moved to take applications from China and Taiwan, and in 2009, 620 of those applying for internships came from those two countries—although only 8 were accepted to finally take up actual internships. The reasons for the low acceptance rate were as always, language and prior work skills.

But while FujiStaff and Pasona are still looking for the right formula to get more foreigners into the workforce via internships and trainee positions, there are already plenty of companies tapping into the foreign student resources pool. According to the Immigration Bureau, 10,277 foreign students in 2008 changed from student status to either an engineering visa or a humanities visa.

I don’t know how many of these were achieved by internships and trainee positions, but knowing that Japanese companies are typically cautious about bringing in foreign staff, I imagine that many of these students changing status are doing so after becoming known to their future employers by some low-risk means such as doing an internship. Indeed, in my opinion, internships are an ideal method for foreigners to segue into a job with a Japanese employer, because the initial shock of having a foreigner in the ranks is soon overcome by growing familiarity and support from co-workers who generally respect a newcomer for having the gumption to do something challenging in their lives.

Internships mean different things to different people. Conventionally for Westerners it is a non-paid opportunity for a student or new-to-Japan young person with little or no work experience to work in a company for 1-3 months, with the objective of either gaining recognition on their resume or to eventually gain employment at the company they are doing the internship for.

Since the 2008 Lehman shock, most larger firms (foreign firms in particular) are more reluctant to give internships, because they realize that the real expense of having an intern is not the cost of the desk and infrastructure, but instead lies in the care and attention the intern needs from existing personnel in order to get trained. This means that internships with foreign firms are more typically found with smaller firms that are looking for a helping hand in return for providing training and experience. However, as FujiStaff and Pasona believe, there is an increasing number of Japanese companies who are committed to going global and therefore have made foreign interns part of their strategic action list.

Last month, Mitsui Chemical announced that has started an internship program for Indian post-grad students in chemistry-related courses to work at company plants in Tokyo and Osaka. Unlike internships at other companies, the Mitsui opportunities will be just 4 weeks a year, but come with a daily “salary” of 3,000 yen as well as a flat 300,000 yen payment to cover air travel, accommodation, and food.

Another company that has an internship program is Rakuten, which last year took on 300 new graduates. In their case, the internships are available for certain job classifications while the students are still at school. Their main requirement is that if a foreign student is applying, that they are able to communicate in Japanese—an interesting requirement, given that the company has now committed to making all internal communication in English by 2012.

I’ve seen a number of less well-known companies work aggressively to bring in foreign students in Japan with the intention of signing them up as employees. One major firm I am familiar with has dozens of Chinese trainees and some full-time employees, with the stated goal of sending them back to China in the future to represent the company with their Japanese customers in that country. I imagine that this same scenario is happening among the hundreds of Japanese corporations who are now expanding breakneck into Asia and elsewhere. It’s not hard, then, to see who is hiring those 10,000 foreign students a year.

Then there is the “other” definition of internship in Japan: which is one of virtual slave labor. I am referring to the foreign trainee and technical internship program established by the government some years ago to allow 200,000 young people from developing countries to learn on-the-job at Japanese companies. After three years of such “work experience,” these workers are supposed to return home again, armed with their new-found knowledge.

Of course, the reality is sadly different, as was exposed through the death through overwork (“karoshi”) of a 31-year old Chinese trainee in June 2008. The Ibaraki Labor Standards Office found that the trainee died from overwork, after having done over 100 hours of overtime every month in the three months prior to his death. The Japan International Training Cooperation Organization reckons that 35 trainees died during FY2008, with 16 dying of causes symptomatic of “karoshi.” In FY2009, 27 such trainees died.

These government-sponsored traineeships/internships do come with salary, which I suppose makes them marginally better than a standard internship—except for the fact that they run for years versus weeks. But the amounts paid are so low, typically around 100,000 yen/month for the first couple of years, that they can hardly be conducive to learning on the job. Rather they create an atmosphere of desperation that obviates any original purpose for people coming in on the program. Instead, the interns become a source of underpaid labor for small manufacturers who would otherwise go out of business.

Genuine internships, on the other hand, are supposed to be a fair and reasonable trade of personal effort by the intern over a short period of time in return for training and work experience by the company offering the internship. While some people think that 3-4 weeks should be long enough for an internship, I think that three months is a more reasonable exchange. My reasoning for this is simple: if the purpose of the internship is to gain meaningful experience and to perhaps prove oneself to a future employer, anything that can be taught in less than 2-3 months is probably not going to amount to much of value to either the intern or the employer.

There has to be a limit, of course, and rationally, this would be the amount of time that it takes for a potential employer to decide that the intern is the right material for a hire. 2-3 months is plenty of time to make this decision, and by no coincidence is also the same amount of time given to a company to decide whether or not to retain or fire a new employee. It also happens to be the amount of time most students have off before having to return to school after the summer break.

The question inevitably comes up of whether interns should be paid, especially since regular new employees are paid for their services. My response is that if the person applying for the internship has no obvious skills or experience to warrant their applying for an open position, the chance of companies even interviewing such people is low. Whereas, someone starting on an internship is able to show growth and on-the-job aptitude, and so have a chance to convince those they are working with that it is worthwhile extending a job offer to them.

Before anyone complains how evil unpaid internships are, consider that not only are they completely voluntary, but that many well-known organizations provide such opportunities. You may be surprised, for example, to know that the U.S. government’s Foreign Commercial Service in Japan offers unpaid internships. To see more on this, go to http://www.buyusa.gov/japan/en/internship.html.

Now that only 80% of this year’s university graduates were able to land jobs before leaving school, maybe it’s time for the unemployed 20%, the government, and smaller Japanese companies to come up with a standardized internship/work experience program that will help both sides. In particular, the government needs to recognize the difference between internships and paid employment, so that issues of compensation are dealt with and all parties to realize the full value of the internship system. They also need to introduce a more specific type of visa for foreign interns, who otherwise have to come in either on a visitors visa (in which case they definitely can’t get paid) or they are forced into one of the above mentioned much abused trainee visas.

Terrie Lloyd writes a weekly newsletter for entrepreneurs and business people about business and political opportunities in Japan.

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12 Comments

noborito at 09:00 AM JST - 31st July

While Japanese can breeze though school, foreigners study and become bilingual and then companies want to attract them to work for FREE or almost nothing. Insane... When they can't find a Japanese people to fill the vacancy's? At the same education level they wouldn't do it? I would say this is the slimiest thing I have seen in Japan. We will give you a visa but work for us for free. Pure slime. Inter systems in Japan are a joke. There is no real reason to have them and hurt anyone who joins them. As most employees start at a company when they are 22 and die in the company around 65 where is the benefit unless you are treated like Japanese staff. There is no job hopping here, so unless you enter the company on schedule, then there is no future. These companies are just working you and then letting you go on your merry way and care nothing about you or your future. They only want free or very very very cheap labor and anyone who says different are completely insane. Of my University friends, I am the only one out of 300 in my class to stay in Japan for any period of time. If fact several left Japan vowing never to return. Most of my friends who come, go very very soon after. (less than a year) This country has a great talent of irritating anyone who really likes Japan and turning them into haters of Japanese. An Internship program is just that. A great way to turn foreigners away from even liking Japan and wanting to work here. A great way to get people to leave.
Ayesha at 10:37 AM JST - 31st July

To have people living and working in a developed society but paid at developing country rates has fundamental flaws, and can be demoralizing for the workers. It's the accident of where you happened to be born. The phenomenon is not just seen in Japan - have a look at the staff working the cruise ships sailing out of Miami. Basically it is people from poor countries providing value to people from rich countries at a big discount, becasue of the where they happened to be born.
burikko at 12:36 PM JST - 31st July

This system, kenshusei, is somewhat deception. Not a few employer works foreign interns at routine work.

I know some companies who have foreign interns. Most of them don't have technical skills. They need to employ workers at low cost. They exploit the system instead of moving their factory to Asian country.

The Japan Chamber of Commerce and Industry said frankly that the system is the system for survival of small enterprises.
knowitall at 07:15 PM JST - 31st July

"I suppose", "I think", "I don't know"... And this is supposed to be journalism?? If you don't know, get the facts before you write!! How is someone to accept that any of this is factual when the author pretty much claims to be ignorant?
sf2k at 01:30 AM JST - 1st August

I agree. What a shoddy article. And way too long for the so called points it generated.

What is it trying to say? That Japan loves suicide in all its forms? Death by overwork, death by pride, death by conformity, death by language replacement. It's a weird little rabbit farm. Was that the point of the article?

Rather ending mandatory overtime through laws that are translated as well into Chinese English and Korean would force companies instead to actually work 8 hours 9-5 rather than waiting for 6pm to get started.

I'm amazed that Japan is still a leading economy given the rest of Asia's real work ethic if not the world's.
sf2k at 01:39 AM JST - 1st August

noborito

sad but true. I am no longer inclined to work in Japan too, but I try as I might to not be a Japan hater. I tell myself to reserve the right to keep seeing the amazing opportunities in Japan and from my Japanese friends directly, and wait for things to improve before I try it again. It's a holding pattern but I feel that helps mitigate a negative response. Europe is easier in comparison though
sf2k at 01:44 AM JST - 1st August

This article comes at a time when a friend of mine non-Japanese is getting the run around with a new boss. I expect he'll get the boat to China pretty soon (aka direct regional office transfer to China without notification or reason). I don't know why people put up with the indignity of leaving their own desires to live and work in Japan. It's like Japanese companies have a culture of getting tired of foreigners and flush them out of companies on a regular basis and can never see people as just people.

How is Japan ever to grow up I ask you?
cracaphat at 02:00 PM JST - 1st August

For employers,its a buyers market so either suck it up for the work experience or branch out on your own.But in the real world,most people have to do some s*** kicking at some time or other.
noborito at 02:55 PM JST - 1st August

sf2k, I too am waiting but how long... I have only 40 or so years left on this planet.
jam_sandwich at 12:33 AM JST - 2nd August

Yeah, I came here looking for an opportunity to work, being in IT, but left soon afterwards. Terrible experience with strict bosses, uncooperative co-workers, and absolutely backwards protocol. Went home and after some recession hardship, found a good job. While I'm stronger from the experience, it was nothing but a waste of time. I loved Japan before, but that love has waned.
limboinjapan at 02:25 AM JST - 2nd August

What is this internship they are talking about?

I work as a consultant and just about all my major clients here in Japan have "interns" in their IT departments most are form places like India and China and when I talk to them I find out that they are not training but are full fledged University graduates in computer science and have many years of experience but are on "intern Visas" because that is what the "Haken" company got them.

This whole thing is a farce!
jason6 at 03:36 PM JST - 4th August

Double standards are a way of life in Japan. You've got the "valuable" foreigners from the right countries with economic clout who have the language/cultural skills as well as potential network capabilities and you've got the "expendable" foreigners from the third-world countries of little strategic importance to Japanese companies. Ironic, but China and India are on track to leapfrog Japan's economy and these expendables will become valuable overnight. But for the moment, karoshi and scorn is all that they will get.