Concerns About Working in Japan Long-Term

For software engineers, Japan’s unique culture, environment, and compensation make it far from a top choice. Many who move here do so simply because they genuinely love Japan. Setting aside salary and Japanese corporate culture, this post focuses purely on the current state of Japanese society and highlights what concerns me the most right now.

The Economy

The year 1990 marked the bursting of Japan’s economic bubble. The Nikkei 225 plummeted from over 30,000 points down to around 15,000 points by the year 2000—nearly cut in half. Source: Nikkei

Only in recent years has there been a gradual recovery, slowly climbing back toward where the Nikkei index stood in 1990. Looking at this alone makes me worry whether Japan can sustain the status quo. On top of that, following the 2011 Fukushima nuclear disaster, Japan poured tremendous amounts of time and money into rebuilding the region, yet agricultural and local products from Fukushima carry a lingering stigma.

Over the past two years, hit hard by COVID-19, the Tokyo Olympics—originally expected to revitalize the economy—turned into a heavy burden, where everyone just hoped it could conclude without major incident. Ultimately, these costs fall on the shoulders of the public, which includes foreign nationals working in Japan.

The Pension System

Japan’s pension system is divided into the National Pension (Kokumin Nenkin) and Employees’ Pension Insurance (Kōsei Nenkin). As long as you work at a Japanese company, Kōsei Nenkin is deducted directly from your salary, with the amount determined by your income bracket. In fact, pension contributions in Japan can end up being more expensive than any single tax.

However, given Japan’s demographic reality, I find it hard to have confidence in the current pension system. According to 2020 statistics, Japan’s elderly population has reached 28.7%—a staggering figure.

Source: Statistics Bureau of Japan

As years go by, Japan’s population will continue to shrink while the proportion of elderly citizens rises. Projections show that by 2030, the elderly will make up 30% of the total population, climbing to 37% by 2045, even as the overall population steadily declines.

With the elderly population growing, what happens to pensions? Whether the current pension system can remain solvent is a serious issue. If it cannot, either the working population will have to pay even higher contributions, or our generation will receive significantly smaller payouts once we reach retirement age.

While this may be an inevitable challenge for many developed nations, it is something you must factor in when choosing to work in Japan. Foreigners can take advantage of the Lump-sum Withdrawal Payment (Dattai Ichijikin) system to recoup part of what they paid, but for anyone planning to stay in Japan for more than five years, it is definitely a question worth pondering.

Culture

Galápagos Syndrome

The term “Galápagos syndrome (加拉巴哥化)” is often used to describe Japanese products developed exclusively for the domestic market with little regard for international standards or overseas markets.

Facing external (foreign) varieties (products and technologies) with high adaptability (versatility) and survival capabilities (low cost), they ultimately face the risk of being phased out.

Wikipedia

Take contactless IC card technology like Suica, for instance. Japan relies on Sony’s proprietary FeliCa standard (a form of NFC), whereas most other countries adopt MIFARE (such as Taiwan’s EasyCard). FeliCa was engineered specifically for the extreme volume of Japanese commuter traffic; if passing through ticket gates took an extra half-second like EasyCard, it would create massive bottlenecks during rush hour.

Another example is Japan’s unique Broadcast Act and television broadcasting infrastructure. Watching TV in Japan requires a B-CAS card. In short, signals sent from broadcast stations to households are encrypted, and you need a B-CAS card to decrypt them. As far as I know, Japan is one of the few countries that encrypts over-the-air TV signals. Yet watching TV is nominally free; although the law stipulates that owning a TV requires paying the NHK reception fee, many people manage to avoid paying it anyway.

As a software engineer, one of the more frustrating things is the presence of JIS (Japanese Industrial Standards). When building products globally, teams typically adhere to ISO (International Organization for Standardization) standards, but Japan maintains its own distinct JIS framework.

Insularity and Language Barriers

From these quirks, you can also sense an innate insularity. Even though labor shortages mean foreign workers are needed to fill vacancies, this does not mean Japanese products are suddenly becoming internationalized or diverse. Perhaps it’s because, at the end of the day, we remain outsiders, and that subtle sense of distance never completely goes away.

Politics

The political apathy among the Japanese public exceeded my expectations. Outside of my foreign colleagues, I rarely heard any of my Japanese coworkers discussing the recent Olympics.

I consider this a serious issue. Reforms and critical policies require political parties to push them through, and keeping those parties accountable and effective requires public oversight. Yet I often feel people here are quite indifferent to politics; most seem to feel that nothing changes regardless of who is in power, and at most, they simply vent on Twitter and leave it at that.

Conclusion

Pointing out these downsides is not meant to dissuade anyone from coming to Japan. Some readers might feel these issues are too distant to worry about—why overthink it? When I first moved to Japan, I felt the exact same way. But as time passes and you get older, making major life decisions requires taking far more information into account.

Working in Japan certainly has plenty of perks. For me as a software engineer, there are abundant electronics and hardware resources, a vibrant custom keyboard DIY community, the convenience of Amazon Japan, excellent public safety (aside from obnoxiously loud bōsōzoku motorcycle gangs), and a high overall quality of life. Still, it might be time to start thinking about what the next step should be.