A severe labor shortage remains the main reason Japanese companies hire foreign workers, a government survey showed Monday, highlighting the economy’s reliance on overseas labor even as Prime Minister Sanae Takaichi seeks to tighten rules for non-Japanese residents.

In the survey conducted last year by 91AV原创 labor ministry, 68.2% of companies said they hired foreign nationals to ease a labor shortage, making it the top reason every year since the survey began in 2023. Some 56% of companies also said they had hired foreign nationals based on merit, while 18% said they were seeking to globalize their workplace. Multiple answers were permitted in the survey.

The number of foreign workers has surged as companies seek labor amid a shrinking population and aging workforce. More than half of the companies reported that they didn’t have sufficient full-time staff, according to a report released this month by Teikoku Databank. Nearly 30% didn’t have enough nonregular staff, the survey showed. The jobless rate fell to 2.4% in July, the lowest in a year.