Facing acute labour shortages, an ageing population and long-standing productivity problems, Japan would appear to be an ideal environment for the adoption of artificial intelligence (AI). Yet AI use in Japanese workplaces remains relatively slow and cautious compared with the United States and the United Kingdom.
Japan’s response to AI is beginning to resemble one of the country’s traditional, slow-moving Noh plays. Everyone on stage agrees that urgent action is needed, and the message is repeated with solemnity, but the actors remain largely frozen in place.
While that may build dramatic tension, it does little to address the country’s immediate economic challenges.
Data on workplace AI use suggests Japan is lagging behind. Only 8.4% of Japanese workers use AI in their jobs, according to a report published late last year by the Organisation for Economic Co-operation and Development (OECD).
The figure compares with 50% in the US and 32% in the UK. In Singapore, where AI adoption is reportedly among the highest in the world and the highest in Asia, 56% of workers are said to use AI several times a week.
So why is Japan moving so cautiously?
Austin Xu, co-founder of US start-up Kuse AI, attributes the slow adoption to the conservative and risk-averse nature of many Japanese companies. His company recently opened an office in Japan to market its AI systems to local businesses.
“Some organisations genuinely take a long time to make decisions because of their process and consensus-driven culture,” he says. “Tolerance for AI mistakes is close to zero, particularly in client-facing roles. Some would rather leave a position vacant than allow a machine to handle it.”
Xu says the approach is very different in the US, where some companies are already giving AI agents greater freedom to improve productivity. In many American workplaces, he says, AI systems are introduced as assistants and gradually become part of normal workflows, with managers willing to test them and correct mistakes along the way.
Japanese companies, by contrast, often require more evidence before trusting AI, he adds.
Parrisa Haghirian, professor of international management at Kyoto University of Advanced Science, also believes risk aversion is a major factor.
“The challenges of adopting AI are similar to those involved in introducing any kind of change in Japanese firms,” she says. “This is why AI use remains limited and cautious, particularly in workplaces.”
Haghirian contrasts Japan’s approach with the more entrepreneurial culture in the US, saying Japanese companies are particularly sensitive to errors, uncertainty and reputational damage.
Because generative AI is still not completely reliable, she says, Japanese companies mainly use it for relatively low-risk activities such as writing, summarising documents and gathering information. Its use remains much more limited in core operations, decision-making and broader business-process improvements.
Japan’s healthcare sector is considered especially slow to embrace AI. Some hospitals have yet to fully digitise patient records.
“Paper documents accumulate at a staggering scale,” an employee at a Japanese hospital, who requested anonymity, says. “It’s like the Stone Age.”
The Japanese government is aware of the broader problem and is seeking to encourage businesses to adopt AI. Last year, parliament passed the country’s first AI Promotion Act, which uses a light-touch regulatory approach aimed at encouraging greater investment in AI.
Tokyo has pledged to make Japan “the world’s most-friendly country for developing and utilizing AI.”
The government sees AI as a potential tool for improving productivity, an area where Japan continues to perform poorly compared with other G7 economies.
Japan’s Ministry of Finance says business adoption of AI has increased substantially, with 75% of companies now using the technology, compared with just 11% five years ago.
Critics, however, say the headline figure masks the limited use of AI within many companies. Only a small proportion of employees may actually use the technology, and even those users often rely on it for only a narrow range of tasks.
Prof Yasushi Ogasawara, an expert on Japan’s social system and technology at Meiji University, says the country also lacks enough workers with strong technology skills.
“Although Japanese people like using gadgets such as smartphones, digital literacy is low here,” he says.
The problem is underscored by a report earlier this year estimating that Japan could face a shortage of nearly 800,000 IT professionals by 2030.
Many Japanese companies also continue to rely on outdated computer systems, with around 60% reportedly more than two decades old.
Ogasawara says companies also face pressure to avoid contributing to unemployment, making them more cautious about developing AI that could replace human workers.
“The government is talking about AI, reskilling and digital skills, but in reality it is difficult to adapt human resources to digital skills because the top priority is maintaining full employment,” he says.
There are signs of change, however. Some companies are beginning to prioritise “AI literacy” when recruiting new graduates.
Larger private-sector firms such as major trading company Kanematsu are hiring graduates with strong AI skills. Uta Yamaguchi, who joined the company in April, says she frequently uses AI at work, as do many of her colleagues.
She uses it to draft emails for her boss, summarise complex documents and record and summarise meetings.
However, she says AI systems capable of independently handling multi-step tasks remain virtually unheard of in Japan compared with the US. Her employer, known for being forward-looking, has now begun introducing such systems.
Ogasawara says the pace of change in Japan remains limited.
“Japanese society expects painless reform, so I think it can be said that drastic reform is difficult, to say the least,” he says.
Disruption may remain an uncomfortable concept in Japan, but without greater willingness to embrace change, the productivity gains the country urgently needs from AI could remain out of reach.
#Source: BBC