While most Japanese firms still maintain a seniority-based wage system, several major electronics makers are beginning to offer high-level rewards to employees in technology and research jobs still early in their career as a way to recruit competent workers. To survive the global competition in artificial intelligence and other advanced fields, they need to secure talented manpower from around the world capable of creating innovative products and breakthrough technology. Behind the budding move is a sense of crisis that as long as these companies remain tied to their seniority pay system, they will lose out to overseas rivals that attract excellent talent with hefty compensation.

NEC Corp. says its decision to introduce a new wage system in October was prompted by the necessity to change the wage and promotion system to compete globally. Under the new system, a newly hired employee fresh out of school may get more than ¥10 million in annual pay. Instead of placing a uniform cap on the wages of first-year employees who wrote highly acclaimed research papers as students, the company will determine their compensation levels based on their research performance.

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