In the international debate surrounding transitions from school to employment, Japan and Germany are regularly cited as examples of success. This article draws on the Japanese concepts represented by two problematic groups--freeters and NEETs--to demonstrate that over recent years, young people in both countries have also been facing serious problems with the transition process. Interpretation of empirical data also, however, reveals a number of contrasts between them. We focus here on differences in their educational systems and on the role each system plays within its own society. The article also uses divergent recruitment practices and employment structures as vehicles for comparison and interpretation.