Japan is poised to reshape its labor migration framework by setting an ambitious cap of about 1.23 million foreign workers under its major labor migration programs through fiscal year 2028. This move represents one of the most significant shifts in Japan’s immigration and employment policy in decades, driven by chronic labor shortages and demographic pressures.
What’s in the Plan?
The proposed number 1,230,000 foreign workers is a combined figure drawn from two key components of Japan’s labor migration strategy:
- Specified Skilled Worker (SSW) Type 1 program: Capped at roughly 805,700 workers, slightly lower than previous projections.
- Employment for Skill Development (ESD): A new status replacing the Technical Intern Training Program (TITP), capped at about 426,200 workers.
The ESD program is designed to transition foreign trainees into more structured employment pathways that emphasize skills development and long-term labor participation. It will officially replace the existing training system by 2027.
According to government sources, this 1.23 million cap is meant to reflect the anticipated gap in labor supply through fiscal 2028 after accounting for domestic workforce efforts and productivity gains.
Why This Policy Shift?
1. Deepening Labor Shortages
Japan’s demographic trends are driving an urgent need for labor:
- The country has one of the world’s fastest-aging populations and a sharply shrinking working-age population.
- Foreign workers have become increasingly vital: as of late 2024, Japan had a record 2.3 million foreign workers, up more than 12 % from the previous year.
Without substantial foreign labor, many industries from construction to care work are projected to face severe manpower shortfalls. Studies estimate Japan may need millions more foreign workers by 2040 to sustain growth targets.
Reforming the Existing Framework
A major part of this initiative involves reforming how foreign workers enter and stay in Japan:
Replacing the TITP with ESD
The longstanding Technical Intern Training Program was originally designed as a skills transfer initiative. However, it faced criticism for exploitation, poor working conditions, and deviation from its original mission.
The Employment for Skill Development (ESD) program aims to:
- Provide more structured skill training tied to employer needs.
- Offer clearer pathways for trainees to transition into longer-term employment under the SSW framework.
- Improve conditions that historically undermined worker protection under TITP.
By unifying training and employment pathways, Japan intends to attract and retain more foreign talent while addressing long-standing labor gaps.
Balancing Public Concerns with Economic Needs
Despite these major shifts, the government has stressed that the 1.23 million figure represents a limit, not a forecasted surge. Officials note Japan does not expect an immediate influx of workers to hit this cap rather, it sets a boundary within which industry demand and labor supply can operate.
Public attitudes in Japan have historically been cautious toward immigration, with political voices urging restrictions on foreign labor and residency as recently as 2025.
This reticence underscores the careful balance Tokyo must strike: easing labor shortages without provoking strong political or social pushback.
Broader Implications
Economic Impact
- Business sectors with acute shortages construction, nursing care, agriculture, hospitality and logistics are expected to benefit the most.
- A larger foreign workforce could help maintain economic stability and ensure the continuation of essential services as Japan’s population ages.
Social and Cultural Dimensions
- Foreign residents already make up a growing share of Japan’s population, nearly 4 million as of mid-2025.
- Integration, community support, and social inclusion policies will be crucial to ensure that foreign workers can live and work effectively in Japan.
Conclusion
Japan’s plan to accept 1.23 million foreign workers under revamped migration programs marks a watershed moment in its labor and immigration policies. By transitioning to the Employment for Skill Development framework and recalibrating limits on specified skilled workers, Tokyo is seeking sustainable ways to address its chronic labor shortages while responding cautiously to public sentiment. Whether this policy can balance economic necessity with societal challenges will be a defining feature of Japan’s labor market in the years ahead.
Originally written by:BY JESSICA SPEED STAFF WRITER
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