TOKYO -- The Japanese government plans to ease restrictions on unskilled foreign nationals seeking to work in Japan, Nikkei learned Tuesday, as the country grapples with a serious labor shortage.

The new policy, which will ease Japanese language requirements for overseas workers, will be incorporated into a work permit system and included in draft economic policy guidelines to be finalized by June.

The change marks a significant shift in Japan's policy regarding overseas workers. Under current rules, work permits are issued mainly to skilled professionals.

The government hopes to attract more than 500,000 overseas workers by 2025 to five industries especially hard hit by a lack of unskilled labor. Japan had 1.27 million registered foreign workers last year, according to health ministry figures.

The new work permits will apply to construction, agriculture, lodging, nursing care, shipbuilding and related manufacturing. Applicants will be required to take occupational and Japanese language tests designed for each type of work by industry associations.

The draft guidelines, called the Basic Policy on Economic and Fiscal Management and Reform, will call for creating a new class of work permits valid for up to five years. Details are still to be fleshed out.

Under the existing Technical Intern Training Program foreign workers are permitted to stay up to five years. The new qualification system will exempt those who have finished the training program from testing.

As for the Japanese language requirements, foreign nationals will have to be "capable of understanding slow conversations," in principle. People are typically able to acquire that level of proficiency after around 300 hours of study, according to Japan Educational Exchanges and Services, which conducts Japanese language testing.

As for the construction and agricultural sectors, even those who have not acquired that basic level of Japanese skill will be eligible for work permits. With respect to technical skills, the government will consider using tests devised and conducted by industry bodies.

The construction sector is expected to face a shortage of 780,000 to 930,000 people by 2025. The government aims to accept a total 300,000 of foreign construction workers through the program.

The labor shortage in agriculture is exacerbated by the aging of Japan's farmers. The program will likely try to bring in 26,000 to 83,000 overseas farmworkers to make up for an estimated shortfall of 46,000 to 103,000 workers by 2023.

Demand for caregivers for the elderly continues to grow as Japan ages. The government estimates the workforce in that sector needs to grow by 550,000 by the end of fiscal 2025. It has tried to attract more hands by introducing measures to raise pay. But it has concluded there are not enough domestic workers to fill the gap, so it hopes to bring in 10,000 workers from abroad.

Japan's contingent of overseas workers has grown by about 600,000 since Prime Minster Shinzo Abe became prime minister for the second time in 2012, mainly through the technical intern program, which aims to provide on-the-job training to foreign nationals for certain unskilled jobs.

The country's labor shortage is becoming the biggest single challenge for the economy. The government estimates Japan's working-age population -- those between the ages of 15 and 64 -- will shrink by about 15 million from current levels by fiscal 2040.