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Job hunting agencies with free student services spread in Japan -- but caution advised

This photo provided by Reastage Co. shows an agent for new graduates consulting with a student.

TOKYO -- The job-hunting process for students scheduled to graduate in the spring of 2023 is in full swing. While it is a common sight every year to see many students gathering at joint company information sessions, an increasing number of job hunters are now using "agencies for new graduates" to assist them in selecting companies and preparing for interviews. A Mainichi Shimbun reporter investigated the situation.

    Akira Mogi, 22, who enrolled in a university in Tokyo, was relieved to receive a job offer from a Tokyo-based IT company in late March. She commented, "I found my ideal company and received a job offer from them." An agency had prompted Mogi to take the IT company's employment test.

    Such agencies provide services that assist students in their job hunt. Once students register their information on the agencies' websites, they are assigned a full-time consultant who provides them with job-hunting advice, corrects their applications, and introduces them to companies based on their preferences. The service is free of charge for students, while the companies that hire the students pay a referral fee to the agencies.

    Mogi registered with such a service in October 2021 and consulted with her agent about once a week, both in person and online, regarding her self-analysis and industry selection. At first, she did not have a specific industry in mind, but through the consultation she narrowed it down to three industries, and then she applied to an IT company she liked among those she was introduced to.

    Mogi recalled, "Using an agency helped me understand the job-hunting process and prevented me from falling behind in that process. I was also able to learn more about the company I was applying to. If I had not used an agency, I would have struggled more."

    According to Tokyo-based Reastage Co., which provides such services, the number of students registering with the service increased from 46,000 in 2019 to 66,000 in 2021. The increase began around 2018. At the time, a labor shortage was becoming more serious and it was said to be a "seller's market." There was accordingly a flood of job openings from companies that wanted to hire more workers. With more jobs available, it appears that more students want to efficiently gather information and determine which companies they should apply to join.

    This trend of employing agency services was spurred on by the fact that the coronavirus crisis reduced opportunities for students to go to their campuses, making it difficult for them to use university career centers and exchange information with friends.

    Ai Inaba of the company's public relations department said, "Many students do not know where to start their job hunting. The gap between ideals and reality is large in job hunting, but by consulting with an agent, students can fill that gap while choosing the company they want to work for."

    However, as the use of such service increases, problems between some agencies and students are reportedly rising. According to industry insiders, agencies receive referral fees ranging from 500,000 yen to several million yen (from roughly $4,000 to tens of thousands of dollars) from companies for every student recruited. However, if a student withdraws after receiving a job offer, the agent is not paid the referral fee.

    A person associated with an agency said, "Recently, companies are hiring earlier and the period between job offers and joining companies is longer, so some students change their minds and apply to other companies. Even if we take the time to provide guidance, it will be in vain if the student declines the job offer. Consequently, some agencies try to force students to join a company and prevent them from declining offers."

    Universities are also becoming more vigilant. A person close to a university in the Kansai region said, "We began to receive an increasing number of consultations about problems (caused by those agencies) a few years ago. Students are rushing to career offices, claiming that recommendations for companies that they didn't like were forced upon them."

    Setsunan University in Osaka Prefecture is calling on students to be wary of such agencies, as there have been complaints at other universities that "agencies do not listen when students decline job offers," and "students' personal information has been passed on to other parties and they have been contacted by companies they don't know."

    What should one be careful about when using such agencies? Naoki Fukushima, an employment consultant, cautioned, "Some agencies can get you into trouble. It is important to thoroughly research the agency by checking its reputation on the internet or by other means before registering."

    In addition, since agents only introduce students to affiliated companies, Fukushima advised, "Information from agents alone may be biased. You can take advantage of the job-hunting process by exchanging information with your university's career center and friends at the same time."

    (Japanese original by Ryotaro Ikawa, Business News Department)

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