Market Overview

The domestic human resources business market size by industry and job category (total of 5 markets) based on the sales at businesses for FY2023 rose by 2.9% to 4,215,100 million yen.

Associated with the normalization of business activities, Japan saw a demand increase for human resources in FY2023, thus expanding the HR business market.
However, the situations vary by category. While growth was observed in the engineer dispatch service, manufacturer dispatch/contract work services, and caregiver recruitment business, top-line growth declined in the sales and marketing staffing service and medical staffing service. The downturn in sales and marketing staffing services was partly due to reduced demand for mobile phone shop staff, as well as supply shortages caused by a lack of available resources. In the case of medical staffing services, demand decreased as the need for COVID-related facilities diminished.

Noteworthy Topics

The size of the construction staffing business market* for FY2023 grew by 3.6% from the preceding fiscal year to 580 billion yen, based on the sales of businesses.

The market declined temporarily from FY2020 to FY2021 due to the completion of construction related to the Tokyo Olympic and Paralympic Games, the conclusion of restoration and reconstruction following the Great East Japan Earthquake, and an increase in site closures during the COVID-19 pandemic.
In FY2022, the market rebounded as demand picked up, driven by the redevelopment of metropolitan areas, infrastructure development in rural regions, labor shortages among general contractors, and the need to hire more workers in response to the upcoming workstyle reform, which will set an upper limit on overtime starting in April 2024.
However, the market growth slowed down again in FY2023. While there was modest growth, the extension of construction timelines due to labor shortages, the postponement of projects caused by budget overruns from rising labor costs, and soaring construction material prices due to inflation had a significant negative impact on the market.

*The construction staffing service market refers to 1) the dispatch of managers for  construction, civil engineering, electrical work, plumbing work, landscaping, construction machinery operation, and telecommunication works, 2) the dispatch of CAD operators who create and revise various drawings as well as operators with a skill to use 3D model-based tool like building information modeling (BIM), and 3) the dispatch of office workers that create, organize, and manage documents needed at each site (including some recruitment services).

Future Outlook

The HR business market by industry or job category (a total of five markets), is projected to reach 4,356,300 million yen, reflecting a 3.3% increase from the previous fiscal year. Demand for human resources is expected to rise due to ongoing labor shortages. However, as competition for talent intensifies across industries, dispatch agencies may struggle to secure the necessary temporary staff, raising concerns about their ability to meet client needs. On the other hand, the recent trend of increasing base wages and growing talent demand at client companies could drive up the unit price of dispatch contracts, significantly boosting the HR business market across all five sectors.

Research Outline