interview=Ken Mitsui | Text=Aya Rikitake | Photographs=Kohei Nishiyama
Success in Recruitment Improves With an Understanding of Credit Checks and Speed
REERACOEN Group launched its services in 2011 as an overseas business of the Japan-based general human resources service provider Neo Career. We asked Kenji Naito, the Group CEO of the Singapore-based company, about changes in the Singaporean human resources market, working practices, the presence of Japanese corporations, and other issues.
Commonalities Behind the Successful Launch of New Business Locations
―Can you tell us about your company?
REERACOEN Group began operating in 2011 in Singapore as the overseas business of Neo Career, a general human resources service provider. Our primary service is recruitment, and we introduce local and Japanese jobseekers to companies in Singapore. We also work with Japanese, as well as other multinational companies and have helped to place approximately 30,000 new employees. We focus on junior to middle-management positions, with salaries ranging from mid-range to those just below high executive salaries. In Asia, many workers change jobs approximately once every two years. Workers hope to advance their career every time they change jobs, and we are also increasing the number of executive class jobseekers.
We also introduce local jobseekers to Japanese companies and foreign companies operating in Japan. This cross-border recruiting service has helped place 3,500 people. We also run ABROADERS, a media for Japanese people who wish to work overseas. Another service we offer is “expert solutions,” which introduces experts and arranges interviews for companies who need insights into APAC. We currently operate in 10 different locations.
―Is there a specific service or initiative that Reeracoen Group focuses on?
Since November 2021, we have been running “Sourcedout”, a platform service which brings together recruiters and companies. We began offering this service to Japanese companies in September 2023.
In over a decade of providing recruiting services in Asia, I have frequently heard people say that while it is difficult to find good candidates through recruiting websites, paying headhunters raises cost performance issues. This is why we offer a service to serve customers at half the cost. If companies are seeking a junior employee with standard employment conditions, we can provide the same level of quality as other recruitment services at half the price.
We have provided this service to around 400 companies since 2021, and we plan to roll the service out to other companies outside Thailand.
―Can you describe your career?
I joined Recruit Agent (currently Recruit) in 2006. After working in Sales in Kyushu and Tokyo, I requested to transfer to Recruit China in 2010. In 2010, the company was based in Shanghai, Beijing, and Guangzhou. We added another seven cities over the following two years and expanded our employees from 40 people to 200. In 2013, I began shifting my focus to other countries in Asia, taking up the post of planning supervisor for our Asian operations (which included China, Hong Kong, Singapore, Vietnam, Indonesia, and India). In the same year as Director of Recruit Vietnam, I was involved in launching our business in Thailand. But then there was a coup d’état. This forced me to come back to Tokyo, but as I really wanted to continue working outside Japan, I decided to leave Recruit. I joined Neo Career in 2015, and was involved in launching a number of new operations for Reeracoen. First in Malaysia, then Shanghai, Taiwan, and Hong Kong locations. I became the Managing Director of Reeracoen in 2018. Whilst Reeracoen’s business strategies and fields differ from those of Neo Career, both companies are human resource service providers with the same goals.
I analyzed the factors that characterize the successful launch of a new location. I discovered that a successful organization always has management policies and fundamental rules that are shared with all team members and new hires at recruitment interviews. We formulated guidance for all of our employees, which we call the “REERACOEN Way.”
Most Japanese Companies Don't Know Why They Struggle to Recruit Non-Japanese Staff
―Can you tell us about your position in the Singapore market?
Singapore is an advanced market with a high level of English. It is an easy place to do business. We are positioned in that market as a company introducing human resources to Japanese corporations. In Singapore, laws regarding labor relationships change twice a year. Therefore, visa and employment support is essential. In addition, as there is surprisingly little forecasting on the domestic market and few research reports, we also hold webinars to provide such information.
Through these webinars, we provide information on topics such as why locals leave their jobs and what kind of companies job seekers choose to work for. This is because many companies hire people without knowing what jobseekers are looking for. For example, when buying a house in Japan, creditworthiness is assessed on income of the previous fiscal year. But overseas, many assessments are based on monthly income. In Japan, if you have a monthly income of 500,000 yen with two bonus payments of 2 million yen, you can declare an annual income of 10 million yen. But overseas you will only be asked for your three most recent monthly incomes. Therefore, companies providing a high monthly income are more popular than those that provide bonuses and benefits.
In Singapore and many other countries, companies are also allowed to fire workers due to company reasons, something that is not possible in Japan. This is why Japanese companies keep the monthly salary as low as possible and make up the difference with bonuses and other payments. Workers end up staying and receiving a high salary, even if their work is not worthy of their wage. Companies must pay such people their salaries, leaving less capital to pay younger workers, and leading talented young people to leave. If Japanese companies try to adapt these frameworks outside of Japan, they cannot attract talent. Many Japanese companies seem unaware of this, which is why we continue to communicate this.
―How would you characterize the recruitment market in Singapore?
Over the last few years, there has been a discrepancy between the number of openings and the number of jobseekers. The recruitment site Jobstreet recently has 70,000 positions for just 20,000 jobseekers. It is a jobseekers’ market, and candidates veer towards companies with better conditions.
One background factor is inflation. Inflation leads workers to prioritize cash on hand, encouraging them to switch jobs every two years for a higher salary. If not, they will suffer financially.
On the other hand, in Japan, deflation did not cause prices to surge. This meant people could work for years at the same company where, even without salary increases, they could get by. The reason salaries in Japan have not increased is greatly influenced by the habit of staying with a single company for an extended period of time. Unless we are aware of the jobseekers’ situation, we will not be able to guide them properly.
If companies want workers to stay for the long term, they need to budget appropriately for their human capital. Japanese companies in Singapore have recently started to improve their benefits by offering, for example, wedding anniversary leave, and more flexible allowances.
Due in part to the repeated layoffs by major tech companies, the number of available posts in 2023 was somewhat lower than 2022, but now the number of posts on offer is recovering. As the recruitment environment becomes more vibrant, Japanese companies are working to improve their salaries and benefits to promote recruitment.
Companies With Strong Recruitment Processes Select and Contact Candidates Quickly
―What can you tell us about the presence of Japanese companies in the market?
We conducted a survey on people’s interests in Japanese companies. We found a strong interest in Thailand and Vietnam, but in Singapore and Malaysia, job seekers were not particularly concerned about a company’s origin. They select companies based on the work and salary, and it may happen to be a Japanese company.
But it is true that many people in Singapore and Malaysia are in favor of Japan. People also see the benefit of Japan’s long-term employment system where, even though salaries may be comparatively low, they can enjoy the long-term job stability. There were voices that people are attracted to the teamwork that develops from working together over the long term.
―What is the key to successful recruitment for Japanese corporations?
First, companies must understand that “Made in Japan” does not carry as much weight as it once did. Japanese business practices are not accepted overseas. They must make an effort to create a better impression than companies compared to other companies overseas. At an interview, the company and the candidate are on equal footing. Companies can no longer demand, “you chose our company, so you should have done your research.” Companies need to start by explaining their business and why they are a good place to work. Even that simple step will improve the quantity and quality of recruitment.
Taking a long time to select a candidate has negative outcomes. Multinational companies will contact a candidate as soon as they have decided to hire them, as well as asking for a response before the originally planned date. Candidates won’t be waiting to hear from Japanese companies that might contact them later. Japanese companies who accelerate their recruitment processes have found it leading to better hiring. “Strike while the iron is hot” is understood in all countries. Speed is important. “When in Rome…” is also important. When working in a country outside Japan, it is important to follow their customs and speed, and delegating authority to their local operations.
Hybrid Remote/Office Workstyle Entails Risks
―Lastly, can you tell us how work styles have changed due to Covid and generative AI?
Remote work is now more common since the pandemic, but people are not great at being alone. Spending time by yourself can lead to negative thoughts and you may not be as disciplined. For example, if you’re aiming for a high goal playing a sport or climbing a mountain, you can persevere with teammates, while you may want to give up if you were on your own. Companies prioritizing remote work should think seriously about productivity. Companies must look for ways to properly evaluate results.
With the exception of specialist work, it is better to have everyone work remotely and have no one come into the office. This is because employees in the office have to answer the phone and handle administrative tasks, reducing their productivity. In addition, managers cannot find areas for improvement that employees themselves are unaware of, making it difficult to educate them. This is why I expect to see more companies move away from remote work and hybrid working models.
Many companies have already introduced generative AI. I expect to see most Singaporean companies making use of it in 2024, eliminating many jobs. Companies in the service industry will be leaving in-store work up to AI and robots, and we expect to see an increasing demand for personnel who are skilled in harnessing AI. Based on these factors, I expect to see companies changing their conceptions of the company locations.
Reeracoen Singapore Pte. Ltd.
3 Anson Road, #08-03 Springleaf Tower Singapore 079909
https://www.reeracoen.sg/ja
EA Registration No.: 12C5051
Inquiries: info@reeracoen.sg
Founded in 2011. Located in 12 Asian cities, assists Japanese companies in recruiting local employees.
Group CEO of Reeracoen. From Tokyo. After graduating university in 2006, Mr. Naito joined Recruit Agent (now Recruit), playing a leading role in the company’s overseas business before joining Neo Career in 2015. He later joined Reeracoen. He helped the company to establish new locations such as Malaysia, Taiwan, Shanghai, and Hong Kong. Mr. Naito is now the Reeracoen Group’s Group CEO.
He frequently travels to various countries in Asia, harnessing his 18 years of knowledge and experience in the Asian recruitment industry. He also does CSR for +one, an NGO HE founded in 2003, and provides support for children living in children’s homes in the Philippines and Cambodia.
