The number of foreign workers in Japan surpassed 1 million for the first time last year, as the labor-strapped Asian nation struggled to find enough domestic employees.

The Labor Ministry said the figure was up nearly 20 percent from 2015, marking a new record for the fourth straight year.

The rapid increase in foreign workers suggested Japan was increasingly turning to people from overseas to plug its labor shortages despite its traditional reluctance to accept them.

The world's third-largest economy is facing its worst labor crunch since 1991 amid a shrinking and aging population which has prompted calls from the International Monetary Fund to resort to foreign workers to boost the economy.

Challenges ahead

The labor shortage is especially severe in the construction sector where demand has exploded ahead of the 2020 Tokyo Olympics and for rebuilding programs following the 2011 earthquake and tsunami.

The Labor Ministry said Chinese migrants made up over 30 percent of the foreign labor force, rising by 6.9 percent from the previous year.

Vietnamese workers were in second place, accounting for around 16 percent of all foreign workers, up over 50 percent from 2015.

hg/jd (Reuters, Nikkei Asian Review)