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Japanese Manufacturers, Once Focused on Mechanical Engineering, Now Struggle to Attract Software Engineers Essential for the Future of Vehicles. The Shortage of IT Professionals Threatens Japan’s Competitiveness, with Companies Like Subaru and Toyota Adopting Bold Strategies to Attract Talents and Secure Their Place in the Global Automotive Market.
A sector that has always been recognized for its strength in recruiting mechanical engineers and for its high competitiveness in vehicle production is now facing a new and unexpected obstacle: the shortage of software engineers.
This situation is taking on significant proportions as the automotive industry approaches a new era, where digital technologies such as vehicle electrification and driver assistance are becoming increasingly essential.
And it is precisely in this scenario that traditional Japanese manufacturers, global leaders in the industry, are now desperately seeking software engineers, a market that until recently did not seem directly related to the automotive industry.
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What Is Behind This Crisis?
In February, Subaru, one of Japan’s best-known manufacturers, opened its second office dedicated to software engineers in the heart of Tokyo, more specifically in the famous Shibuya district.
This location, occupying the 41st floor of one of the city’s most iconic buildings, the Shibuya Scramble Square, is not just a change of address: it is an aggressive strategy to attract IT talent vying for a place in the global market.
The Battle for Software Engineers in Japan
This Subaru office can accommodate up to 80 people and offers a panoramic view of Tokyo and even Mount Fuji, an additional attraction for professionals in the field.
Additionally, it has been designed to attract engineers specialized in artificial intelligence, essential for the development of modern automotive systems, such as those that assist drivers.
“Shibuya has become a reference for us, as talented engineers have joined us one after the other,” said Eiji Shibata, a Subaru executive responsible for software-defined vehicle (SDV) development.
What stands out is that this new office is not isolated. It is part of a WeWork coworking space, a collaborative environment aimed at creating networking with technology startups and other companies in the area.
This not only facilitates interaction with new mobility companies but also offers opportunities to hire software engineers directly from other technology sectors.
The Shortage of IT Professionals in Japan
However, the IT market in Japan is far from being a bed of roses. The country faces an alarming shortage of qualified professionals in the software area.
According to Japan’s Ministry of Economy, Trade and Industry, the demand for IT engineers in Japanese manufacturers has increased significantly, but the supply of qualified professionals is declining.
It is estimated that by 2025, Japan will face a shortage of about 33,000 software engineers, a number that is expected to rise to 51,000 by 2030.
The Impact on Manufacturers
This shortage of qualified professionals is deeply affecting the development of software-defined vehicles, a field in which Japan aims to stand out.
The country aims to achieve a 30% market share in software-defined vehicles by 2030.
However, without the necessary workforce to drive this technological revolution, the goal seems distant.
Japanese manufacturers, in search of quick solutions, have begun to rethink their recruitment strategies.
They are seeking to attract software engineers with skills in areas such as machine learning, vehicle electrification, hydrogen fuel cells, and electronic control units.
However, not all companies are aware that the IT market is becoming increasingly competitive, and many of the large automotive companies are still viewed as less attractive to specialized professionals.
What Is Missing to Attract Talents?
James Kuffner, former executive at Toyota and current CEO of Woven by Toyota, the automotive giant’s technology subsidiary, warned that Japanese manufacturers are falling behind their Chinese and American counterparts.
According to Kuffner, Japan has a considerably smaller number of IT engineers compared to other countries, such as the United States and China.
“In Japan, only 1.4 million IT engineers were active in 2024, while the U.S. had 4.5 million and China had 3.5 million,” revealed Kuffner.
In addition, the country ranks only 31st in the global salary ranking for IT engineers, which makes these professionals prefer to work for companies in other countries, where salaries are more attractive.
This ultimately makes it difficult to attract and retain these crucial talents for the automotive sector.
Changes in Hiring Profiles
Japanese manufacturers, such as Toyota and Honda, have begun to adopt new approaches to attract talent.
Honda, for example, announced changes to its personnel management system, focusing on the flexibility of salaries and working conditions.
Additionally, the company has also eliminated the mandatory retirement age for qualified professionals and increased international hiring, especially in India and Vietnam, where there is a large supply of highly qualified IT engineers.
Toyota, for its part, has also been seeking professionals from industries such as gaming and other technology companies to fill the shortage of engineers specialized in automotive software.
The Future of Japanese Manufacturers
Despite the efforts of manufacturers, there is still a significant gap between the sector’s needs and the current reality.
The lack of recognition of manufacturers as technology companies and the traditional profile of the industry, focused on mechanical engineering, are barriers that still need to be overcome.
For Japanese manufacturers to achieve their innovation goals, it will be necessary to convince IT professionals to join them.
However, there is no magic formula to win this global competition.
According to Noriaki Yamamoto, an executive at Bizreach, a specialized recruitment platform, manufacturers need to be clearer about the advantages of working in this sector.
Companies need to show professionals that their skills are essential for the digital transformation of the automotive industry.
What Is Next?
As Japan tries to find solutions for its lack of IT talent, the global automotive sector is becoming increasingly competitive.
Manufacturers need to quickly adapt to the new demands of the market or risk losing their position as global leaders.
The shortage of software engineers is not a problem exclusive to Japan, but the urgency with which the country faces this issue can be an example for other industries and nations in the same situation.
Japanese manufacturers have much to learn from their global competitors and will need to accelerate their digital transformations if they want to remain relevant.
The fight for attracting software engineers is just the beginning of an even greater revolution.
Ótima notícia, mais uma evidência que o ano se inícia depois do carnaval.