CEO behind Japan’s best-performing stock says his secret is raising salaries

Want to say that this model is still alive and well in Japan (like anywhere else obviously), and these days it looks like charging $10k/month (a lot to companies here for a single developer) for $2-5k/month developers in APAC or eastern Europe, with the guarantee that the project will be looked after based on the sensibilities of someone local/from the US (this person is usually the face of the business or extremely high up, etc).

At it's worst this pattern is parasitic but at it's best it's mutually beneficial symbiosis -- if we look at the reality of whether the developers could clear the trust barrier (whether it should be there or not is another question) to getting the roles, it becomes a question of what that barrier skip is worth.

BTW, Japan is rife with middlemen taking cuts. If you want to have a chuckle, look into property purchasing in japan/proptech. There are usually 3+ middlemen in the apartment purchase flow here, and fees that you do not see in most other places, ex. "reikin" (AKA "Key Money")[0].

[0]: https://en.wikipedia.org/wiki/Key_money

Companies hire external experts (or "experts") in order to fix hiring problems (can't find the necessary people), or because they find it hard to predict future needs (might only need them for 3 months, or 3 years), or because they don't have the management team in place to manage those people (every person hired is a call on managers to give them work to do, and more admin to do). These are all things that are often well worth paying 4X what it'd cost to employ the staff themselves.

Parasitic implies one party (implied the employee?) is left worse off than otherwise. If these jobs are being accepted normally it's because the local offers are worse and the developer is not good/doesn't want to deal with the international business side (inc. finding clients, negotiating, etc). So it seems that in a free-ish market, this relationship would be strongly symbiotic, right?

Interestingly in Japan they have "Key Money" and "Lock Change fee", which are two different non-refundable BS fees and they confused me initially. The key money also depends by region, with Kansai having it almost everywhere and in other areas "it depends".

> Parasitic implies one party (implied the employee?) is left worse off than otherwise. If these jobs are being accepted normally it's because the local offers are worse and the developer is not good/doesn't want to deal with the international business side (inc. finding clients, negotiating, etc). So it seems that in a free-ish market, this relationship would be strongly symbiotic, right?

It's hard to guarantee that the labor side wouldn't have been able to land the contract without the labor re-seller, so it's up to your own personal bias to see this as a service or as predatory. Could go either way but on a case by case basis this is subjective in my opinion.

There's not much magic here (well if there is, it can vary greatly), the contracting agencies are middlemen reselling labor that is in various states of compatibility to the company purchasing the labor. Perfectly compatible market actors could be using middlemen when they don't need to, and middlemen are incentivized to make this the case.

The usual questions of whether middlemen are good or bad apply and it's not as simple as it being strongly parasitic or strongly symbiotic in any case, it's more like a spectrum which is why I described it as such.

A bit of anecdata: I know someone who worked for a contracting firm in NYC that hired Japanese developers (and relocated them) to work in the American market and paid them Japanese wages to work at American companies. The Japanese developers were always happy at first because they were blissfully ignorant and didn't know what the company actually charged. Just because the host isn't aware of the parasite doesn't mean it's not being adversely affected -- some hosts just live severely degraded lives with no idea that they're being drained. It's possible to take the stance that labor is simply paying for imperfect knowledge/market conditions but by that logic exploitation might as well not exist, and if that's the argument then we probably disagree on fundamental grounds about lots of things.

> Interestingly in Japan they have "Key Money" and "Lock Change fee", which are two different non-refundable BS fees and they confused me initially. The key money also depends by region, with Kansai having it almost everywhere and in other areas "it depends".

Sure, it's possible that the region a person wants to live in does not have Key Money in Japan, but I wouldn't count that a likely outcome. ~55% of apartments in Tokyo look to require Key Money[0], but I'd argue that even if it's not required, most first and maybe second time renters in Japan will pay it, thinking it's just a cost of doing business. All that changes in the second or third transaction ins knowledge on the renter's part.

[0]: https://resources.realestate.co.jp/rent/what-percentage-of-a...

Nice linguistic trick of trying to just mix "homogenous populations" and "good areas/bad areas" as if they're interchangeable /s

There's definitely huge variation in quality of areas in Tokyo (more or less parks, more or less access to services etc). Less so now, but many areas had a good amount of crime too! Loads of people don't want to live in areas cuz of the "bad vibes". People get stuff stolen here too! And there's a "good school"/"bad school" thing for certain areas.

But there's a baseline that is still something you can survive with. So yeah maybe you have a shitty environment but it's not "the entire bottom has fallen out" like chunks of the US. The schools have (some) money, and (relatively) clean water comes out of the pipes. And if you make very little money there is some semi-public housing that can fit a family of four.

And poorer families are given cash, not food stamps with 1000 exceptions to them.

All this sociological exoticism (mainly from Americans) is really missing the forest for the trees. A lot of it is the result of giving people some means to survive, even in difficult times. The US would change a lot if it could adopt that attitude.