Labor War Between Silicon Valley and Japanese Auto Industry

While nobody conflates a job at an assembly plant in Detroit with a developer in California, there is a labor war between these two industries for top engineers and researchers. Established automakers are developed increasingly smarter and more sophisticated vehicles and connected software tools and apps that require talented programmers.

Toyota and Honda are becoming more and more aggressive in their desire to keep talent at home as the demand for automotive tech experts soars, as is the cost of getting and retaining these new niche experts. Toyota has resorted to putting up billboards and posters along a stretch of the Tokyo commuter rail targeting information technology engineers – this line is connected to one of Japan’s biggest research tech centers. The company has been unabashed in its desire to attract homegrown talent over those from Silicon Valley; at least, that’s the marketing spin is on the posters lining the rail routes.

Why is this such a big deal? Well, it probably wouldn’t be a big deal in any other job market, but in Japan company loyalty is still considered extremely important, and employees traditionally stay with one employer for life. For any company to be so aggressive in its search for new talent is sending ripples through the domestic car industry. This highlights the pressure that car manufacturers are now facing in the changing tech landscape.

Manufacturers are scrambling to try to get ahead of their competition as demand and interest in connected tech, electric vehicles, autonomous cars, and artificial intelligence continues to drive product strategy, thus the urgent need for software engineers. They now have to compete with tech companies and with other automakers. Toyota will have to deal with the fact that the average IT salary in Japan is about $55,000, whereas the same job in Silicon Valley goes for double that, not to mention the potential opportunity to work for ‘cool’ startups. Whether or not Toyota only wants homegrown talent or is just using a marketing strategy to attract local software engineers, we don’t know. But the labor war for top engineers is just beginning.