A Japanese Steel Giant Heads to Shibuya to Woo Top TalentBy
Recruiting top workers gets more difficult as population drops
Bolstering manufacturer’s image is key to landing top recruits
Convincing teenagers in Japan that working for a giant, 116-year-old manufacturer is a sexy career choice seems like a tough sell. It’s even more difficult if the target audience can’t figure out the company’s name.
That’s the challenge for Nippon Steel & Sumitomo Metal Corp. in a country where a shrinking population means intense competition for young workers. While none of the company’s 4.63 trillion yen ($41.6 billion) of revenue last year came from consumer products, it is trying to create brand identity with a glitzy 30-second video on a giant screen in Tokyo’s Shibuya shopping district, where lights, people and traffic cram Japan’s busiest intersection.
“We’ve been feeling a huge gap between the company’s expanded presence in the industry and the low degree of recognition in the public,” said Fumiaki Ohnishi, the company’s general manager of public relations.
But not far from where images of molten steel fill a screen attached to a 109Men’s department store in Shibuya -- to the tag line “Make your life steel” -- 17-year-old Shiori Yokoyama is confused. The company created by the 2012 merger of Nippon Steel and Sumitomo Metal Industries has ditched the combined moniker for what it hopes is a more hip and catchy symbol -- an abbreviation depicted in kanji, the Chinese characters used in one of three forms of Japanese writing.
“I can’t read it,” Yokoyama said after being asked to interpret the kanji script as she waited for a friend outside the Shibuya train station, near a popular meet-up spot -- the statue of the loyal dog Hachiko.
She wasn’t alone, according to a random survey around the bustling Shibuya intersection, which marks a retail district synonymous with Japanese youth fashion and pop culture. Only two of 10 people aged under 30 who were interviewed by Bloomberg could correctly identify the acronym describing the world’s third-largest steel producer.
The Tokyo-based company uses the kanji symbol for “Sumikin” -- which combines an abbreviation of Sumitomo with a shortened version of the word for metal, kinzoku. But some people read the word as jyukin, a melding of abbreviations for the Japanese words jyutaku, or housing, and kinyu, which means financing.
This failure of brand identity illustrates how far Japan’s once mighty steel industry has fallen out of the public eye, especially after service industries and high-technology companies became the largest part of the economy. In the mid-1980s, more than 90 percent of people knew about the steel giant -- then called Nippon Steel Corp. -- or had heard the name. The percentage dropped to 50 percent last year.
A diminished public profile makes recruiting more difficult, even in a Japanese work culture that almost guarantees lifetime employment. That’s partly because there are fewer young people to tap for jobs. The number of children under 15 years is the lowest ever at 15.71 million, which represents just 12.4 percent of the population, also a record low, according to the Ministry of Internal Affairs and Communication.
Among university students in Japan with science and engineering backgrounds, Nippon Steel & Sumitomo Metal ranked 87th in terms of popularity, according to a joint survey this year by Mynavi Corp., a Tokyo-based job-information company, and the Nikkei financial newspaper. In 1978, Nippon Steel ranked fourth among students, according to Mynavi.
Today, careers in tourism, food and banking tend to be the most popular choices among students, even though Nippon Steel & Sumitomo Metal ranks among the top 20 Japanese companies in revenue and the top 30 employers, with almost 85,000 workers.
The company got its start in 1901 when the Imperial Steel Works opened on the southern island of Kyushu, where workers were encouraged by the government to help the country catch up with the West. Output grew with mergers and acquisitions over the years. By 1970, it was the largest company in Japan and the top steel producer in the world. It now produces more than 40 percent of the country’s steel.
Nippon Steel & Sumitomo Metal would be better known domestically if it came up with a breakthrough product, like a new kind of structural support that makes buildings withstand Japan’s recurring earthquakes, said Yoku Ihara, the head of Growth & Value Stock Research of Japan. The company also needs to make the public understand how important the metal is to their daily lives, he said.
“People would appreciate the value of steel if the industry can respond to the public need,” Ihara said.
While finding top talent is getting difficult, the company’s message is still managing to lure graduates like Hidenori Akiyama, 24, who recently earned a masters degree after studying quantum science and energy engineering.
On April 3, the first business day of the new financial year, Akiyama was among more than 300 new recruits gathered for a welcoming ceremony at the company’s headquarters in the central Tokyo ward of Chiyoda. Attendees wearing navy-blue or black suits stood up, raised their right hands to their heads and said “goanzenni,” the word for “keep safe” that is a common greeting at Japanese mills.
“I feel close to steel,” Akiyama said, because it “will remain the important industry” for all sorts of things in people’s lives. He was fascinated by the scale of a giant mill he visited during his junior year of college and returned for a two-week internship before graduation. “Steel supports the society,” he said. “And that’s why I’ve chosen to work in the industry.”