The government's decision to create a new visa status for foreign workers to fill the domestic manpower shortage represents a major change in Japan's strict immigration policy that has in principle prohibited foreigners from engaging in unskilled labor. With its rapidly aging and declining population, the nation needs to sustain its workforce. This is a step in the right direction and a welcome change from the policy of trying to fill manpower needs through the Technical Intern Training Program and work provided by students from overseas. The challenge going forward will be how Japan can attract enough foreign workers as competition among countries to secure labor from abroad is set to intensify.

Under the decision featured in the outline of the government's economic and fiscal policy, the new status will be accorded to those who will work in sectors suffering from acute domestic manpower — including agriculture, construction, shipbuilding, lodging services and elderly nursing care — after passing skills tests in each sector and Japanese language exams. The maximum term of their residence will be five years. People who have taken part in the Technical Intern Training Program for at last three years will be exempt from the skills and language test requirements. An amendment to the Immigration Control Law will be submitted to the Diet as early as this fall, and the government reportedly expects to accept roughly 500,000 people from overseas under the program by 2025.

The government has prohibited foreigners from engaging in unskilled labor, while seeking to invite more foreign workers with professional expertise in such jobs as education, legal services and business management. As the number of registered foreign workers keeps rising and hit a record 1.28 million as of last year, however, much of the increase has in fact come in unskilled labor provided by people whose purposes in Japan are not supposed to be employment, such as the technical interns and students from overseas — who together account for more than 40 percent of the foreign workforce.