Small business owners who join the “starting salary war” understand nothing.

Read the original article (in Japanese):初任給“爆上げ”の副作用…中堅社員の不満、企業は消耗戦に | Business Insider Japan


1. The Shock of the Starting Salary Boom

As starting salaries climb to ¥300,000 and even ¥400,000, competition for new graduates is intensifying. While large corporations drive this trend, some small and mid-sized companies are beginning to panic—thinking they must follow suit or risk being left behind. But this fear is misguided. In fact, being swept up in that illusion may ultimately strangle the business.

2. The Illusion of "Top Talent"

High academic credentials or flashy résumés do not guarantee success. What truly matters is hiring individuals who fit your company, grow within it, and contribute over time. Candidates drawn solely by high pay will likely leave when offered better terms elsewhere. When too many rootless employees fill an organization, culture deteriorates, know-how fades, and the company’s philosophy loses continuity.

3. Ignoring Mid-Level Employees Breeds Silent Collapse

Another serious consequence is the disruption of balance with mid-level employees. When new graduates receive better treatment than those with years of experience and loyalty, internal discord is inevitable. The organization’s vital, invisible currents—trust, acceptance, and mutual understanding—begin to stagnate. Core employees quietly exit. And even high-paid newcomers, left without mentorship or support, soon follow. What remains is a hollowed-out structure and unsustainable payroll costs.

4. What Should SMEs Do?

The answer is simple: Stop competing with the giants. Play your own game. Only a few companies can afford ¥300,000 or ¥400,000 starting salaries. There’s no shame in hiring people who didn’t land those elite positions. In fact, employees who accept a reasonable offer and still choose your company are more likely to stay. That’s where the strength and sincerity of SMEs lies.

5. Mid-Level Staff Are the Cornerstone

For SMEs, the true backbone is mid-level employees. They carry the culture, understand customers, and know how to run the operation. If you don’t protect them, you’re protecting nothing. Even when improving new hire conditions, mid-career staff must also be compensated accordingly. Ignoring them drives out your most trustworthy people.

6. Real Strength Is in Developing What You Have

Corporate strength isn’t defined by the “best hires you can get today,” but by how you nurture and empower those already with you. That steady investment is what gradually builds true value.

It’s like soccer: a J3 league team isn’t signing Messi. But by training current players and building reputation, they can one day rise to J1 and attract stars.

7. What’s Really Being Tested Is Philosophy

You can’t simply raise salaries and expect lasting impact. Once you increase pay, there’s no turning back. That decision requires a full reevaluation of your company’s structure—pay systems, career paths, development plans, and cultural narrative. Without these, a higher salary is just a number. People won’t stay.

8. Conclusion: Face Reality and Build on What You Have

So long as SMEs are caught chasing illusions, they’ll fail to build meaningful retention or loyalty. Imitating big firms won’t work. Success lies in accepting your company’s reality and crafting your own winning strategy.

  • Who are you hiring?

  • What values do you want to share?

  • How do you ensure people stay and culture survives?

Companies that face these questions directly—not those who ask “how much can we pay?”—are the ones that will survive and grow in the years to come.


Read in Japanese↓

「初任給バブル」に踊るな──中小企業が生き残るための採用戦略（2025.5.19）

Read more articles (in Japanese)↓

退職が続く会社の“本当の問題”｜辞め方の質が組織の未来を決める（2025.5.15）

 

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