Leadership in Japan and Mental Health — Are We Ready for the New Hiring Reality?

Three candidates in a row, each with mental health issues—and recruiting fees in the tens of thousands of dollars. Is it bad luck or a sign of change? Many leaders’ instinctive reaction is to avoid “broken” candidates for fear of future absenteeism or costly leave. Yet, the reality is more complex. These issues are often invisible until after probation ends, at which point contract clauses with recruiters leave companies financially exposed.

Leaders must revisit recruiter contracts, extending probation review periods from 30 to 60 days to identify early warning signs. But more importantly, we must recognize a broader social shift: mental health challenges are becoming more visible, not more common.

Mini-summary:
What feels like bad luck may actually be a new leadership challenge—one that demands smarter systems and more human understanding.

Japan’s shrinking labor market means many firms simply can’t afford to be selective. Leaders are forced to weigh two difficult options:

1. Hire individuals with mental health issues and provide support, or

2. Leave positions unfilled and overburden existing staff.

Neither choice is ideal, but both are reality. Leaders who cling to the past—expecting only “perfect” candidates—risk burning out their teams. The key question becomes: Can we evolve our leadership mindset to support people who may sometimes struggle, but still want to contribute?

Mini-summary:
Leaders must decide whether to adapt their management style or be left behind by demographic and social change.

Diversity, Equity & Inclusion (DEI) has become a buzzword across Japan’s corporate world, yet mental health rarely enters the conversation. A truly psychologically safe environment means more than “no harassment”—it means ensuring every employee, including those managing anxiety or depression, can work with dignity and purpose.

This does not mean eliminating accountability—it means balancing performance expectations with empathy. Leaders should ask: How can I make my workplace safe enough that employees don’t have to hide or withdraw?

Mini-summary:
Real DEI extends beyond gender and nationality—it includes mental health inclusion and psychological safety.

The “tough love” era is over. Raising your voice or publicly shaming staff now risks a power harassment complaint. For many senior managers who grew up in a harsher business culture, this shift feels disorienting. Yet, today’s young employees—and those facing mental health challenges—expect communication rooted in respect and care.

Older leaders often ask, “Where was my psychological safety when I was getting yelled at?” The answer: it didn’t exist. But leadership has evolved, and so must we. Refusing to adapt is not toughness—it’s irrelevance.

Mini-summary:
Modern leadership means adapting your tone, empathy, and expectations—not lowering performance standards.

A joke I often tell sums it up: “Japanese staff love change. They want their boss, clients, and markets to change—but they’ll stay exactly the same.”
But are we, the leaders, any different? Many of us want the next generation to adapt to our standards rather than evolving our own leadership.
Yet, the future belongs to leaders who combine clarity, empathy, and flexibility. Mental health inclusion is not a trend—it’s a leadership skill for the 2020s and beyond.

Mini-summary:
True adaptability begins with leaders themselves. If we want resilient teams, we must become resilient and compassionate leaders first.

• Hidden mental health issues are rising in visibility, not incidence—leaders must learn to respond, not reject.

• Review recruiter contracts and extend probation periods to identify issues earlier.

• DEI must evolve to include mental health inclusion and psychological safety.

• The “tough love” era is over—communication must be respectful, supportive, and clear.

• Leaders who resist change risk becoming obsolete in Japan’s evolving workforce.

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Founded in the U.S. in 1912, Dale Carnegie Training has supported individuals and companies worldwide for over a century in leadership, sales, presentation, executive coaching, and DEI. Our Tokyo office, established in 1963, has been empowering both Japanese and multinational corporate clients ever since.