I just read the OECD Economic Survey on Japan from this year which highlights the “key economic challenges” facing the nation over the next decade. This sentence from the conclusion generally sums it up:
While the Japanese economy is in its best shape since the early 1990s, the basis for comparison — the weak economic performance of the last decade — does not set the bar very high.
This report estimates Japan’s future growth rates at the meager 1.3% a year, and Japan will only keep up with the other countries’ per capita income gains if it can maintain high working hours (already 8% above the OECD average), increase labor force participation rates (which the low birth rate is making difficult), and boost labor productivity to 2.5% (Japan’s labor productivity is infamously poor).
Japan’s per capita income has fallen to 75% of that the United States, even though the per capita incomes of other OECD countries have been relatively stable. Increases in private consumption will only follow gains in income, which means that consumerism isn’t likely to return to early ’90s levels anytime soon.
The report sharply criticizes the new Japanese employment practice of hiring temporary “non-regular” workers at much lower salaries and less job security. Apparently, there is little difference in productivity between the regular and non-regular workers, and non-regular workers have a difficult time moving to regular employment. In other words, the male elite students hired as permanent employees get 60% larger salaries for doing essentially the same amount of work as those with less prestigious backgrounds. This will obviously create a substantial income disparity in the future. On top of that, most skills come not from the educational system, but from firms’ in-house training, which means that non-regular workers seriously lack human capital.
Greater female participation in the workforce could be beneficial to the economy, but the fact that women make up 2/3 of the lower-paid, non-regular workforce is not providing economic encouragement for their mobilization.
Another interesting statistic: Workers aged 15 to 24 show a 10.1% unemployment rate and more long-term unemployment than the other OECD countries.
What does this mean for Japanese pop culture? Consumerism will most likely not be on the rise anytime soon, so I would doubt that the fashion, music, and media markets are going to boom in the next decade. There will, however, be a new class of wealthy youngsters, and if they max out their pocket money, this could create a visible class-based rift in cultural consumption. Until now, pop culture and semi-subcultural practice in Japan have been defined predominantly through consumption, but a possible saving stroke would be the shift from shopping/buying as the main youth activity to non-commercial producing/creating. Tradition suggests that this shift is unlikely, but I would not rule it out.