Immigration News: October, 2004 - Volume 11

Japan, Korea

Japan has an estimated 760,000 foreign workers-- 1.5 percent of the 53 million strong work force- and two million registered foreign residents- those in Japan three months or more. Foreigners in Japan remitted $2.8 billion officially in 2003, and an estimated $5.5 billion unofficially, to China, Korea, the Philippines, Brazil and Peru.

Japan may open its nursing labor market to foreigners, although it plans to require them to undergo hospital training in Japan before taking the national exam that leads to four-year work visas. Japan signed a free-trade agreement with Singapore in 2003, and is negotiating one with the Philippines that could provide freer entry for Filipino health care workers. By one estimate, 85 percent of the 178,000 Filipino nurses are employed abroad.

Korea. On August 17, 2004, Korea introduced its first guest worker program, which allows employers to hire foreign workers for up to three years in small manufacturing firms (with under 300 employees), larger construction firms and agriculture. The Korean Labor Ministry has signed memorandums of understanding with the Philippines, Mongolia, Thailand, Vietnam, Indonesia and Sri Lanka under which 25,000 guest workers are to be recruited for Korean jobs during the first year of the program; an MOU with China is planned.

Under these MOUs, sending countries are to select three to five times the number of candidates that will be allowed to work in Korea, and Korean employers are to select workers from the list. Korean employers say they hire migrants because they cannot find Korean workers and because the migrants' wages are lower. There is no levy on employers of migrants.

The first guest workers to arrive under the MOUs were Filipinos arriving to work in manufacturing firms for 1 million won ($860) per month. The industrial trainee program will continue, and 38,000 trainees will be admitted next year. Trainees do not receive the Korean minimum wage, as guest workers do.

The government planned to remove all unauthorized workers before the new guest worker program started, but did not- there were an estimated 166,000 illegal workers in August 2004. Almost half were Chinese, and about seven percent each were Vietnamese, Bangladeshi and Filipino. Korea plans to step up enforcement of employer sanctions, under which those who hire more than 10 illegal migrants can be fined up to 20 million won and be jailed for three years.

Perspective. Korea began to receive foreign workers in the buildup to the summer Olympics in 1988, and imported its first "industrial trainees" in November 1993 for smaller manufacturing firms (with fewer than 300 employees). The number of trainees rose steadily- there were 30,000 in 1994, 80,000 in 1996, 85,000 in 2000, and 146,000 in 2002, making the Korean trainee program the largest in the world.

Beginning in April 2000, trainees who completed two years could become workers for an additional two years and, after 2002, for three years. In November 2001, a guest worker system was introduced for ethnic Koreans who were at least 40 years old and have relatives in Korea who were coming to work in service industries such as restaurants and housekeeping for up to three years. They were considered workers, entitled to minimum wages and labor law protections.

The number of illegal migrants rose sharply, as trainees "ran away" from the employers to whom they were assigned to earn more as unauthorized workers- by 2002, some 80 percent of the foreign workers, some 290,000, were unauthorized. Demonstrations by migrants and their supporters prompted the government to propose turning trainees into guest workers beginning in 1995, but employers objected, arguing that their costs would rise. The compromise was to retain the trainee program and add the new guest worker program.

A survey of Korean employers with legal and illegal foreign workers in Fall 2003 found that over 64 percent used some type of private recruitment agent, which contributed to "runaways" because migrants had to pay them fees. Under the new guest worker program, employers will request migrants from public agencies, although they can specify the desired country of origin. In Fall 2003, migrant workers were paid about three-quarters as much as similar Korean workers, a million won a month compared to 1.3 to 1.4 million won a month, but illegal workers earned more than legal trainees.

Employers typically provide housing for migrants, which makes their costs about 85 percent as much as Koreans despite their lower wages, but migrant productivity is about the same as that of Koreans, making them cheaper. Most migrants attain full productivity in less than four months, and most employers provide little ongoing training.

In opening to immigration, Asian countries such as Japan and Korea are likely to begin with "ethnics," descendants of past emigrants who have cultural similarities even if they have lost their parents and grandparents language. The second source of settlers is likely to be foreign students who enter, learn the language and are hired after graduation by local employers.