[Dramatic Changes in the Japanese-English Bilingual Labor Market in the US] 9. Wage Gap Between Japanese and American Companies
Our primary business involves placement and staffing and we’ve noticed significant regional differences in wage levels across the United States in recent years.
At the general staff level, the average wage in the Midwest region is higher than in the Southern region, while Southern California has relatively lower wage levels. These differences are largely influenced by the industries prevalent in each region.
In the Midwest and Southeast, bilingual talent is scarce, creating an extreme seller’s market (favoring job seekers). As a result, companies offer higher wages to attract talent. Conversely, in Southern California and New York, where bilingual talent is abundant (a buyer’s market), there is less urgency about raising wages. This is surprising, considering the higher cost of living in California and New York.
Occasionally, client companies request a “Japanese Company Wage Level Survey.” However, due to the small sample size and the significant wage gap between Japanese and American companies, it’s questionable how useful such information would be. Knowing the wage levels of neighboring Japanese companies seems of limited value when the disparity with American companies remains so large.
There’s an interesting comparison between the Midwest and the South regarding wage disparities. While Japanese companies generally have lower wage standards, the wage gap between Japanese and American companies is significantly larger in the Midwest than in the South. In the South, a sign-on bonus at the time of hiring can sometimes bridge the gap. However, in the Midwest, even such measures often fail to attract top talent to the open position.
Take Indiana, for example. Despite being a small state, Indiana actively attracts businesses from around the world and hosts many companies statewide. This aggressive business recruitment has led to wage inflation among neighboring companies, making it difficult for Japanese companies to secure quality talent. On the other hand, the Southern region still appears to have room for further business attraction efforts.
Written by Masato Fujihara, President
Interesse International Group
Came to New York as an expatriate for an HR company in January 1994. Became independent in 1996 and started own business in defiance of return-to-Japan order by the company. Currently, Interesse International Group has 11 locations in the United States and established a Japanese subsidiary in 2022. With 30 years of knowledge and experience in the HR industry, Interesse International Group delivers practical information to clients.
