Recruitment and Retention Risks for Technical Employees Due to a Declining Working-Age Population

「In the manufacturing staffing industry, labor shortages have persisted due to tight supply and demand. Recruitment has become more difficult as a result of higher recruitment costs and intensifying competition to secure personnel.」

「As more people chose how to work in line with their lifestyles, the highly fluid non-regular labor market expanded, while labor shortages became more pronounced and recruiting personnel grew increasingly difficult each year.」

「Although the number of hires increased, a shortage of follow-up after assignment and deterioration in the accuracy of matching job seekers with workplaces resulted in a higher attrition rate, highlighting an issue for the Company.」

「In the regional business, the Company successfully secured new job orders by intensifying sales activities from the beginning of the period and focused on increasing the number of hires. However, it was unable to establish an adequate system for post-hire follow-up and on-site management, resulting in a higher early attrition rate after employees joined the Company.」

「The active job openings-to-applicants ratio for production process occupations has continued to decline from a peak of 2.07x in December 2022, reaching 1.62x in March 2024, indicating that the supply-demand balance for personnel in production process occupations is easing.」

「The active job openings-to-applicants ratio for production process occupations has continued to decline from a peak of 2.07x in December of the previous year, reaching 1.73x in September 2023, indicating that the supply-demand balance for personnel in production process occupations is easing.」

「During the cumulative third quarter under review, there were no significant changes in the matters described in this quarterly report regarding the business and accounting conditions that management recognizes could materially affect the financial position, operating results and cash flows of the consolidated companies, or in the “Business and Other Risks” described in the securities report for the previous fiscal year.」

「During the cumulative second quarter under review, there were no significant changes in the matters described in this quarterly report regarding the business and accounting conditions that management recognizes could materially affect the financial position, operating results and cash flows of the consolidated companies, or in the “Business and Other Risks” described in the securities report for the previous fiscal year.」

「As industrial production increased year on year in many industries, led by the automotive industry, the active job openings-to-applicants ratio for production process occupations rose to 1.86x in December. Employment conditions in manufacturing continued to show signs of resilience and recovery in job openings and other indicators.」

「During the cumulative second quarter under review, there were no significant changes in the matters described in this quarterly report regarding the business and accounting conditions that management recognizes could materially affect the financial position, operating results and cash flows of the consolidated companies, or in the “Business and Other Risks” described in the securities report for the previous fiscal year.」

「The nationwide active job openings-to-applicants ratio rebounded from a low of 1.03x in September 2020 and showed signs of bottoming at 1.06x in December, while the ratio for production process occupations recovered sharply from a low of 1.02x in August to 1.25x in December.」

「During the nine-month consolidated period, there were no new business or other risks, and no material changes to the business or other risks described in the annual securities report for the previous fiscal year.」

「During the cumulative second quarter under review, there were no new business risks and no material changes to the business risks described in the securities report for the previous fiscal year.」

「The Group's business environment has been characterized by labor shortages across the manufacturing industry, a rise in the active job openings-to-applicants ratio to levels above those during the bubble economy, and the start in April 2018 of the conversion of fixed-term contract employees to indefinite-term contracts, as required under the revised Labor Contract Act. As a result, the automotive sector, which had previously been cautious about using temporary staff, also increasingly used temporary staffing.」

「The Group's business environment has been characterized by labor shortages across the manufacturing industry, a rise in the active job openings-to-applicants ratio to levels above those during the bubble economy, and the April 2018 start of the conversion of fixed-term contract employees to indefinite-term contracts, as required under the revised Labor Contract Act. As a result, the automotive sector, which had previously been cautious about using temporary staff, also began making serious use of temporary staffing.」

「Most of the technical employees engaged in the Group's business are young, making them particularly susceptible to these effects in terms of recruitment, and the recruitment of technical employees may become increasingly difficult over the medium to long term.」

「The Group's business environment has been characterized by recruitment difficulties resulting from the rising active job openings-to-applicants ratio. In addition, as the April 2018 start of the conversion of fixed-term contract employees to indefinite-term contracts, as required under the revised Labor Contract Act, approached, the automotive sector, which had previously been cautious about using temporary staff compared with the electronic components and semiconductor sectors, also began making serious moves toward using temporary labor.」

「The Group's business environment has been characterized by recruitment difficulties resulting from the rising active job openings-to-applicants ratio. In addition, as the October 2018 start of the conversion of fixed-term contract employees to indefinite-term contracts, as required under the revised Labor Contract Act, approached, the automotive sector, which had previously been cautious about using temporary staff compared with the electronic components and semiconductor sectors, also began making serious moves toward using temporary labor.」

「The Group's business environment has been characterized by recruitment difficulties resulting from the rising active job openings-to-applicants ratio. In addition, as the October 2018 start of the conversion of fixed-term contract employees to indefinite-term contracts, as required under the revised Labor Contract Act, approached, the automotive sector, which had previously been cautious about using temporary staff compared with the electronic components and semiconductor sectors, also began making serious moves toward using temporary labor.」

「As improving employment conditions kept the active job openings-to-applicants ratio at a high level, labor shortages and a sellers' market persisted, making recruitment difficult in many fields.」

「The Group's business environment has continued to be characterized by improving employment conditions against the backdrop of the government's proactive economic policies, a persistently high active job openings-to-applicants ratio, labor shortages and a sellers' market, making it difficult to recruit personnel in many fields.」

「When recruiting technical employees, the Group companies may find it difficult to secure the technical employees they need, depending on labor market conditions.」