Korec, a recruitment agency that connects Japanese firms with soon-to-be college graduates in South Korea, has cancelled its monthly recruitment event for September.

“Some Japanese companies have been hesitant to visit South Korea as the bilateral conflict lingers on,” said Japanese CEO Kasugai Moe.

“However, as for our activities, we are continuing to help students prepare for job applications,” Moe said.

The two northeast Asian neighbours have been locked in a growing list of disputes stemming from Japan’s move in July to restrict exports of microchips and smartphone materials to Korean tech firms. The acrimony has so far culminated in both countries taking each other off their list of preferred trading partners, with South Korea also terminating an intelligence-sharing pact. Ordinary Koreans have joined in by calling for a boycott of Japanese goods and tourism.

At the core of the tensions lie different versions of World War Two history. In July a South Korean court ordered a number of Japanese companies including manufacturing giant Mitsubishi to make reparations to Koreans subjected to forced labour in wartime.

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The breakdown in the relationship has put the brakes on growth in the number of Koreans, especially the young, who head to Japan in search of better career opportunities. Youth unemployment in South Korea stood at 9.9 per cent at the end of 2017 – the highest figure since the government started gathering data, according to official statistics. In contrast, Japan has been enjoying a record-high employment rate of 77.9 per cent and is suffering from a historic labour shortage which has seen the country open its doors to foreign workers like never before.

It takes about 11 years to secure a job in South Korea for people aged between 15 and 29, according to Statistics Korea. And 62 per cent of those quit their positions in less than 15 months due to dissatisfaction. The number of South Korean workers in Japan surpassed 50,000 in 2017 – a number up 8,000 from the year before. Only 1,185 Japanese nationals hold working visas in South Korea.

The appeal of Japan is despite the country offering wages often no higher by some measurements. Starting salaries in Korea average out at about 2.69 million Korean won (US$2,250) a month, according to employment website Incruit. A recent Nikkei survey found the average in Japan to be 217,000 Japanese yen (US$2,020).

Meanwhile, for Japanese employers, South Korean workers have been popular choices. A 2018 study by the Korea Trade-Investment Promotion Agency found 96 per cent of 177 Japanese firms wanted to hire Koreans. Some 70.6 per cent of 148 companies already employing them said these workers were “sincere, proactive, and driven by strong initiative”.

But the blossoming links are now under threat from the declining diplomatic friendship. An expo held by the Korea-Japan Cooperation Foundation for Industry and Technology in mid-July garnered 20 per cent fewer participants than previous fairs.

“I think the decrease in attendance for our expos is temporary,” said one team manager with the foundation. “If the relationship improves between the two countries, interest in Japanese jobs will go back to what it usually is.”

Park Cheol-su, career strategy development team manager at South Korea’s Hannam University, previously posted about 10 students a year to positions with Japanese IT or services-related firms using personal contacts with employers. He said he had taken a more passive approach to these companies in recent weeks.

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“But we haven’t cancelled any recruitment events for this year, and students who have invested years in preparing to land a job in Japan have not stopped their efforts,” Park said. “We don’t want to hit a pause in our interaction with these Japanese companies as it will be difficult to pick up a stalled relationship.”

As for Korean students already in Japan, some have been reconsidering since relations turned sour but few plan to take action.

One student studying architecture at Kwansei Gakuin University near Osaka said that while some of his peers had questioned their choice, it was nevertheless “hard to find any Korean students going back home due to the recent events between the countries”.

However, his parents could prove an obstacle in the future. After South Korea became engulfed by anti-Japanese sentiment this summer, they called their son expressing worry.

“We don’t really bring up the tensions between the countries during our talks any more,” the 26-year-old, who declined to be named, said. “My parents and I know that finding employment in Japan is the best choice for my current situation, and therefore, it makes it hard for me to return to South Korea.”

Korec’s Moe said: “I see some students whose parents disapprove of their plans to work in Japan. The parents don’t understand why their children must work in a country that is seen in a negative light by Korean society at the moment. A lot of students therefore find it hard to be public about their preparations.”