Annual Salary Soars Past 300 Million Won for Thirtysomethings... Fierce Recruitment Battle Among Major Corporations

Japanese Corporate Talent Wars Intensify

Seniority-Based Pay Broken as Companies Turn to 'Market Value'

SOMPO and Mitsubishi UFJ Offer Exceptional Compensation

As global competition for talent intensifies, major Japanese corporations, which have traditionally operated their human resources systems based on lifetime employment and seniority, are rapidly overhauling their compensation structures. In high-demand fields such as artificial intelligence (AI), cybersecurity, and financial markets, new systems are spreading that determine annual salaries based on market value rather than age or years of service. As a result, Japan’s conventional wage system is now undergoing significant change.

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For Rare Talent, 'Market Price' Trumps Seniority

According to Nihon Keizai Shimbun (Nikkei) on August 24, SOMPO Holdings, a leading Japanese financial group, introduced a new exclusive recruitment system called the 'SOMPO Professional Pool' in June. Under this system, the holding company directly hires and manages highly specialized professionals—such as those in AI, cybersecurity, legal affairs, and compliance—for regular employment at the group level and then dispatches them to its various subsidiaries.

By utilizing this system, even young professionals in their early thirties can secure a generous annual salary in the mid-10 million yen range (approximately 130 million to 150 million won). Previously, SOMPO had switched its employment rules in 2020 to a job-based system, but since a mixture of seniority-based and job-based models remained across subsidiaries, it was difficult for individual companies to offer high salaries. The new centralized hiring approach by the holding company has overcome this limitation.

This trend is spreading throughout the financial industry. Mitsubishi UFJ Bank is actively attracting professionals in system development, financial markets, and cybersecurity by utilizing the 'Ex (Expert) System,' introduced in 2024. While maintaining the existing membership-based employment rules, the bank has added separate pay guidelines, enabling employees in their mid-thirties to receive treatment equivalent to that of a branch manager or head office department head. Currently, approximately 800 employees out of 22,000 domestic staff—including more than 40 career professionals and internal specialists—are subject to this system.

For S-Class Talent, Up to 320 Million Won... Even Batch Hiring of New Grads Is Being Abolished

The competition for recruitment among IT and tech giants is even bolder. Fujitsu has introduced a separate compensation system for AI, data science, cybersecurity specialists, and in-house lawyers. These professionals are classified into four levels—S, A, B, and C—based on their scarcity and business contribution, and are paid additional compensation accordingly.

Office workers are boarding buses on their way to work at the Yeouido Bus Transfer Center in Seoul.

S-class, the highest level, can command annual salaries of 25 million to 35 million yen (approximately 230 million to 320 million won) through individual negotiations. Talent in grades A to C also receive monthly allowances of 50,000 to 300,000 yen, in addition to their base pay.

Fujitsu has also changed its recruitment process. After adopting job-based employment in 2020, the company will no longer hire new graduates in bulk starting in 2025, transitioning to a year-round recruitment system that does not differentiate between experienced and new graduates. The strategy is to recruit talent with the required skills regardless of timing or career stage.

Headhunting Fees Soar as Companies Hunt for Talent... Limitations to Seniority-Based Pay

The background to these changes is intensifying competition among companies for highly skilled professionals. In fields such as AI and cybersecurity, fierce recruitment by foreign firms has effectively set a “market price” for talent.

If companies turn to specialist headhunting firms to secure employees, the average recruitment fee amounts to about 35% of the candidate’s annual salary. From a corporate perspective, even if recruitment costs increase, failing to secure key professionals could mean a loss of competitiveness.

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There are also limits to paying high salaries to select individuals within a traditional seniority-based wage system. Topping up base pay with various allowances can, over time, be treated legally as part of the base salary—potentially leading to increased costs for overtime, bonuses, and severance pay. As a result, Japanese companies are responding by establishing separate wage and employment conditions for professional talent.

However, it is difficult to say that all Japanese companies have abandoned seniority in a short period. According to a survey by the Japan Business Federation (Keidanren), only 26% of 337 companies surveyed have adopted, plan to adopt, or are considering job-based employment.

Nikkei analyzed that, with a flexible ecosystem now in place where the market value of core professionals—such as those in AI—is determined in real time, companies that do not quickly break away from traditional employment models will inevitably fall behind in global industrial competition.

This content was produced with the assistance of AI translation services.