Rewriting & Optimizing: Immigration Reform in Japan
The new Cabinet-level panel, led by Chief Cabinet Secretary Minoru Kihara, will review "foreign national-related issues that warrant urgent attention and propose specific solutions by January." This initiative marks a crucial moment for Immigration Reform in Japan, particularly for established Foreign Residents. Initially, the scope appeared broad, lumping tourists, non-resident real estate purchasers, and long-term residents together. This lack of differentiation fueled unnecessary concerns about a potential surge in xenophobia.
Fortunately, this approach is evolving. To quickly and effectively address systemic shortcomings without creating undue anxiety, government communications must be carefully targeted. This is especially true for the long-term foreign-resident community in Japan, who largely share the same concerns as Japanese nationals regarding overtourism and unregulated non-resident real estate purchases.
Addressing Misconceptions about Immigration Reform
A significant challenge in any discussion about foreign nationals is the language used. Immigration Reform is often misconstrued. We must make one thing perfectly clear: Japan does not currently have an "immigrant" problem as that term is typically understood. An immigrant is usually defined as a foreign national who moves to another country with a view toward becoming a citizen of the host country when eligible or, at minimum, living there permanently.
In contrast to countries like the United States, which sees substantial numbers of new naturalized citizens and new green card holders annually, Japan's naturalization rates are minuscule. The U.S. averages around 800,000 new naturalized citizens and 1.1 million new green card holders each year, the latter being equivalent to Japan's permanent-resident status. With roughly one third of the U.S. population, Japan only sees about 7,000 to 9,000 naturalizations per year. If we exclude the Chinese and Korean "special permanent residents" (SPRs)—individuals born and raised in Japan whose families arrived before 1945—the number of naturalizations from all other nationalities drops to a tiny 2,000 to 3,000 annually.
Permanent Resident Status in Japan
Navigating Immigration Reform in Japan often begins with understanding visa requirements and long-term residency for Foreign Residents.
Similar claims were also raised that securing permanent-resident status is "too easy." Of the four million Foreign Residents in Japan, approximately 932,000 hold permanent-resident status, with another 270,000 being SPRs. This totals around 1,200,000. This is a cumulative increase of about 14% over the last decade. While the number of SPRs is gradually declining, the annual increase in permanent residency has been about 3.2%. The current wait time for new applications in Tokyo is over 18 months. Furthermore, the national approval rate since 2015 has consistently hovered around 50%. These figures certainly don't suggest an easy or automatic process.
LDP Task Forces Address Systemic Issues
To create a system that is both effective and fair, three crucial task forces have been established within the Liberal Democratic Party. These groups are designed to establish the cross-ministerial cooperation that has often been lacking in the past. Their goal is to directly support the Cabinet-level "foreigner-related" panels. Working alongside the LDP's coalition partner, the Japan Innovation Party, the hope is that specific proposals for Immigration Reform can be enacted more quickly with broad political support.
Task Force One: Enhanced Screening and Status Management This first task force will review and address issues related to screening and controls for new applicants for long-term residence status. It will also focus on strengthening status management for existing long-term Foreign Residents. One key example of their focus is that residence extensions could be denied to individuals who do not pay the requisite pension and health insurance premiums, particularly after repeated payment requests. This targets the minority who exploit the system while reinforcing compliance for the law-abiding majority.
Task Force Two: Closing Social Service Loopholes The second group is clearly directed at tourists who exploit loopholes in Japan's social services. Some tourists have abused the issuance of Japanese driver's licenses and subsequently skipped the country without paying their medical expenses. This task force is actively seeking to close loopholes that have allowed ineligible persons access to national health insurance programs. This step aims to protect Japan’s social infrastructure from misuse.
Task Force Three: Regulating Real Estate Purchases The third task force will focus on security aspects and other issues related to unregulated Japanese real estate purchases by foreign nationals. This includes purchases made by both individuals and corporate entities. This addresses a growing public concern about strategic property acquisition.
Targeting Resources for New Arrivals
Japan's entry points, like Narita Airport, are central to the discussions around Immigration Reform and the effective management of Foreign Residents.
With the number of Foreign Residents growing annually, even after accounting for departures, government resources should be strategically applied. A focus on stronger screening of new arrivals is essential to assess their assimilation potential. Clearer communication is also required to ensure that new arrivals fully understand the rules governing their participation in pension and health-insurance programs. They must also be aware of the serious implications should they fail to comply with these rules.
A productive approach may be to focus available resources on the visa categories showing the fastest year over year growth. In a recent analysis (2024 data), the fastest growing categories were "specified skilled workers" at over 20%, "students" at 18%, "engineer/humanities/international services" at 15.5%, and "technical interns" at 13%. Collectively, these groups represented 70% of all new arrivals. Focusing regulatory and support efforts here could yield the greatest impact on effective assimilation and compliance, smoothing the path for future Immigration Reform.
Understanding Assimilation and Generational Differences
The origin and arrival time of Foreign Residents are often as important as the reason for their stay. Journalist Kei Nakajima has provided fascinating insights into the current "foreigner problem," particularly concerning Chinese residents in Japan. Her work highlights a growing tension between Chinese nationals who arrived in the 1980s and early 2000s and those who have arrived in the last decade.
The earlier group generally arrived in Japan to work and study. They have, for the most part, successfully assimilated into Japanese society. The more recent arrivals, however, often come with business-manager visas and significantly greater financial resources. Nakajima suggests that many newer arrivals are here to "escape China" and, unlike their predecessors, tend to "look down on Japan." They reportedly demand that things be done "the Chinese way." These recent arrivals often seem uninterested in assimilation and are frequently resented by earlier arrivals as being arrogant.
The Distinction Driving Xenophobia Concerns
This dynamic is not exclusive to one nationality. Part of the emotional pushback we are hearing from earlier generations of long-term Foreign Residents—those who have assimilated and are law-abiding—stems directly from their reaction to newer arrivals who may not share their respect for Japanese norms. Many share the same fear expressed by older Chinese residents: that the poor decisions or perceived bad behavior of the more recent arrivals will reflect poorly on them all.
This distinction is crucial and often unrecognized. It explains why many American, European, and other expatriates—who have lived and raised their families in Japan for decades as dutiful taxpayers and supporters of Japan’s health and pension systems—speak about a recent “rise in xenophobia.” They are rightly asking why they are being included in a discussion that has little to do with their established, compliant status. True Immigration Reform must clearly segment the audience to avoid alienating these essential long-term contributors. It is vital to separate the issues of overtourism and non-compliant new entrants from the status of established, settled Foreign Residents.
The solution to fixing the system without sparking widespread xenophobia is through targeted policy and precise communication. The government must make it unequivocally clear that its measures are aimed at those who exploit the system—be they tourists or non-compliant new arrivals—not at the large, law-abiding, and deeply integrated community of long-term residents.
Pathways for Harmonious Integration
For Country Managers and Founders navigating the complex landscape of Japan's regulatory environment, understanding the nuances of Immigration Reform is key to successful talent management. The current review presents an opportunity to advocate for policies that strengthen oversight of new arrivals without negatively impacting the stability and rights of established staff. Clearer rules for new entrants will ultimately benefit all Foreign Residents by reducing the negative public perception caused by a few non-compliant individuals.
Steps Towards Effective Management
Establish a Stronger Vetting Process: Implementing a more robust vetting process for key categories like "specified skilled workers" and "engineer/humanities/international services" ensures that new arrivals possess the necessary skills and a foundational understanding of the laws in Japan. This proactive approach minimizes future compliance issues.
Mandatory Compliance Education: New visa holders should undergo mandatory, comprehensive education regarding their responsibilities, particularly concerning the pension and health insurance systems. Clear, multi-lingual resources are vital. This is an area where companies operating in Japan can partner with the government to ensure their foreign staff are fully compliant.
Differentiate Long Term Residents: Government communication must consistently and explicitly differentiate between long term, law-abiding Foreign Residents and the temporary or non-compliant groups. This simple act of clarity is the most effective defense against the generalized fear of xenophobia. This differentiation is the core of effective Immigration Reform.
Leveraging Current Momentum
The establishment of the new Cabinet panel and LDP task forces indicates a high level commitment to addressing these issues. This is a positive sign for businesses in Japan. For the first time, a cross-ministerial approach is being attempted, which is essential for tackling issues that cut across health, labor, and justice ministries. This coordinated effort offers the best chance for meaningful, non-discriminatory Immigration Reform.
