Why you should consider SMEs as a career option in Japan

Updated: Dec 16, 2019

Author: Claire Liu

Published date: December 9th, 2019

JAL, Mitsubishi, Toyota...big name companies like these are a constant hum amongst the background chatter as we hit job hunting season. There’s a reason why these huge companies are at the top of their respective industries and thus it’s common sense to aim for a career there.

Before we recklessly follow the herd and throw in our applications for the big name companies, it may be a good idea to step back first and consider why are we aiming for them in the first place?

Putting the question in another way: what about the companies that are not one of these big name companies?

Big name companies you often hear about. (Source: logodix)

Most people choose big name companies for their name and stability, but with the benefits comes a heavy burden. This is why if you're lost with your career path, it's important to consider SMEs too.

Wait... what is an SME again?

SME stands for ‘small to medium enterprises’ and refers to a small-scale company that can range from a 5 people home office to a medium sized business of 250~500 employees.

Large corporations tend to dominate the realm of job hunting, but the reality is that SMEs make up the majority of our economy, and they definitely deserve more attention than they currently have. In fact, 90% of the companies in Japan are SMEs and are vital to the economy. The Japanese government has also been putting effort into introducing the SMEs of Japan to the global market. This can be seen through organizations like JETRO (Japan External Trade Organization) and SMRJ (SME Support Japan)

Why should I work for an SME? What do they have to offer me?

Working at an SME is especially beneficial in the working environment in Japan.

Despite constant push for change, Japanese companies are generally very bureaucratic and that tends to be the number one factor resulting in foreign nationals to shift jobs.

To understand better, let’s take a look at the three main disadvantages of working at a large corporation:

1. Hard to distinguish oneself

It is true that joining a large, well-established workforce provides stability, but at the same time it then becomes difficult to distinguish yourself from many others. This is especially true for companies that are really competitive in their recruitment. A lot of the time, the stress of trying to standout among other excellent new employees can be overwhelming.

2. Difficult to climb the corporate ladder

Most people start from zero when they join a large company, working at the bottom of the corporate ladder before slowly making their way up. In Japan, it is the norm to join a company for life, so by "slow" we mean a buffering period from when you first enter the company to when you retire.

3. Unable to fully reach potential at times

Yes, working at a large company is stable, but it also tends to be too stable and follow a fixed bureaucratic structure. Often times, foreign nationals find it especially hard to adapt to this structure, and tend to feel that they don’t have the chance to showcase their abilities.

Compared to this, it is the complete opposite situation for a SME. Let’s take a look at the top three benefits of working at a SME:

1. Every employee counts

Every employee counts because with a workforce of so little people, much more is expected from everyone. You are expected to take initiative rather than wait around for orders. Depending on the size of the company, a lot of the time, people find themselves helping out in areas outside of their expertise.

2. Intimacy

Although we can’t say that SMEs are free from the bureaucratic system, the working environment of SMEs is definitely more intimate than that of a large company.

3. Easier to move up the corporate ladder

On top of all this, it is also much easier to be noticed in SMEs from your skills and thus, becomes much faster to go up the corporate ladder.

...but along with all benefits comes the following disadvantages as well.

1. A lot of hard work

It’s probably clear by now that working at a SME requires a lot of hard work. Unlike a large corporation where you work in teams and divide the work, most of the time you have to take up a whole project alone.

2. Taking on work out of your specialization

It is also common for you to work in a variety areas simply because there aren’t enough people. This may seem tedious, but it is something you should brace yourself for.

3. Higher risk

Unlike large companies where you just focus on getting your part of the job done, at an SME, the company as a whole is your lifeline. If the company fails, then there goes your job, and the reality is that SMEs have a much higher probability of failing compared to large companies. This however, can also be seen as a good thing. After all, everyone is in the same boat at a SME, meanwhile, politics tend to overrun the workplace in large competitive companies.

"I had a couple of offers from big companies actually. But there’s just something about working at Tokyo I found very off-putting. On the contrary, I absolutely loved Oita and wanted to stay here. The great thing about working at an SME is that there’s a lot of space for growth. I won’t lie, it was very tough at the start because I had to take on a lot of tasks. In fact, I am currently part of the engineering team as well as recruitment team.

There was a lot to learn and a lot of challenges which really helped me grow. When I talk to my friends who went to work at big name companies, all of them complain about how they felt that they couldn’t really develop their skills."

- Malaysian national currently working at a scaffolding and construction SME in Oita

I know what you are thinking... what about the pay?

It is no secret that the wage at an SME can not be compared to that of a large corporation. However, if money was the only thing you were considering, then you probably wouldn’t be reading this article in the first place.

Here is a simple breakdown of the average SME income and resulting salary:

(Source: career-picks)

This is an average salary of 3~4 million yen. The reality is that although the salary at a SME is comparatively lower than that of a large corporation, it is actually hovering around the average salary in Japan of 4.2 million yen. So it is important to not only think about the salary, but also the other benefits as well.

So now you know about SMEs in Japan... where to now?

There’s a reason why SMEs tend to get overlooked. There are just so many SMEs that it’s hard for any such company to stand out. Thus we hit the question of where and how to find the right company for yourself.

A good place to start is with SME supportive government organizations. They give spotlight to certain SMEs and provide information in English. Obviously, it’s impossible to list down all the available SMEs in Japan, but these sites serve as a gateway to the world of SMEs and can be quite inspiring as well. Here are two recommended sources to get you started:

"For me, I just knew that I wanted to do something related to event management. Throughout my last two years of university, I just exposed myself to a variety of events and activities. It was from these interactions that I was introduced to a company that manages international relations related events.

Being perfectly honest, I have never heard of the company before but I was immediately intrigued... and here I am now working for that company. You’ll be surprised how close a big opportunity might actually be, all it takes is to take the initiative to approach these possibilities. I used to think I was lucky to come across this company by chance, but I now realize it is not by coincidence.

By knowing what it is I wanted and putting myself out there, people and opportunities that align with my vision naturally came to me."

-Recent graduate currently working at an events management SME in Fukuoka

At the end of the day, the unique characteristic about SMEs is its intimacy. Which is why rather than researching about companies online, it is much more beneficial to look around you and get personal. You may be surprised at the kind of opportunities that are actually right before you now.

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