10 Signs Japan is Stuck in the 1990s in Many Ways

Japan, once seen as the pinnacle of technological innovation and economic might, has struggled to evolve in key areas over the past few decades. Despite its reputation as a futuristic country, many aspects of Japanese society, culture, and business remain firmly rooted in the 1990s.

Here are ten specific reasons and examples that illustrate this phenomenon.

Cash-Based Society

Japan is still predominantly a cash-based society, with many businesses not accepting credit cards. IC card systems for transit and small purchases only became widespread in the 2000s, lagging other developed economies. ATMs often close at 7pm.

Fax Machines and Flip Phones

In the workplace, physical fax machines, pocket pagers, and flip phones are still common in Japan compared to the U.S. and Europe. Reasons include data privacy concerns, regulations requiring physical paperwork, and attachment to legacy systems.

Stagnant Economy

Japan’s economy has been largely stagnant since the early 1990s, when the asset price bubble burst. GDP growth has averaged just 0.9% annually between 1992-2022, compared to 2.2% for the U.S. in that period. Wages have barely risen in 30 years.

Aging Population

Japan has the world’s oldest population with 29% over age 65 as of 2021, due to low birth rates and high life expectancy. The working-age population has been shrinking since the late 1990s, sapping economic vitality. Adult diapers now outsell baby diapers.

Rigid Corporate Culture

Japan’s corporate culture remains hierarchical and seniority-based, valuing loyalty and conformity over creativity and individualism. Promotions and pay are still often based on age rather than merit. Inefficiencies like after-work drinking sessions with the boss persist.

Lack of Diversity

Japan remains largely homogenous, with foreigners making up just 2.3% of the population as of 2021, compared to 13.6% in the U.S. Women hold just 15% of senior and leadership roles in business. Change is slow.

Smoking

Japan’s smoking rate of 16.7% as of 2021 is higher than the 12.5% in the U.S. Cigarette advertising is still common and smoking is allowed in many bars and restaurants. Health warnings on packaging remain small.

Plastic Waste

Japan generates the 2nd highest amount of plastic packaging waste per capita after the U.S. Excessive packaging of products and bagging of purchases is the norm. Recycling programs and awareness lag other developed countries.

Work-Life Balance

Long working hours are still common in Japan, with 16.5% working over 49 hours per week, compared to 10.4% in the U.S. Using limited paid vacation days is often frowned upon. Maternity and paternity leave uptake remains low.

English Proficiency

Japan ranked just 78th globally in English proficiency in 2022, the lowest in East Asia. This is despite English education being compulsory from elementary school. Practical English communication skills remain underdeveloped compared to South Korea, China, and others.

While Japan excels in many areas, its struggle to evolve beyond legacy systems, demographics, and cultural norms has left it trailing its peers in various respects, appearing stuck in a 1990s mindset. Addressing these challenges will be key to Japan’s vitality in the 21st century.