Uchikura & Co., LLC

Uncomfortable Truth About Japan

Why Japan Feels Cheap to Foreigners — but Not to the Japanese

 

If you ask tourists today what surprises them most about Japan, many will say, “It’s so affordable.” Hotels, food, trains, and even high-quality services often feel inexpensive compared to New York, London, or Paris. But here is the uncomfortable truth: Japan does not feel cheap to the people who live there. It feels cheap to foreigners because Japanese wages have barely grown in real terms for more than 40 years.

 

In the early 1980s, Japan was one of the world’s fastest-growing economies. Salaries were rising, and families could see their standard of living improve year after year. Then the bubble burst in the early 1990s. What followed were the “Lost Decades,” when companies survived and exports remained strong, but wages stagnated. Pay increases became rare, bonuses shrank, and lifetime employment weakened. Inflation stayed low — but so did income growth.

 

Meanwhile, in the United States and Europe, wages continued to rise over time. Even through recessions, incomes climbed. By the 2020s, this created a dramatic gap. When Americans or Europeans visit Japan today, they bring currencies backed by decades of wage growth. A ¥1,000 bowl of ramen, a ¥10,000 hotel room, or a cheap train ride feels like a bargain. To a Japanese worker earning roughly what their parents did decades ago in real terms, those prices feel normal — sometimes heavy.

 

Japan didn’t become cheap.
The rest of the world became more expensive — and Japanese incomes did not keep up.

 

Japan chose stability over disruption. That brought clean streets, safe cities, and low inflation, but it also made companies cautious about raising wages and governments focused on protecting the system rather than household income. The result is a country that works beautifully, yet quietly limits how far its people can go.

 

This wage stagnation explains why young people delay marriage, why consumer spending is weak, why the yen is soft, and why tourism has exploded. Foreign money stretches far in Japan — good for visitors, but a warning for the nation.

 

That frustration is now political. Young Japanese worked hard, played by the rules, and still feel shut out of opportunity. That is why Prime Minister Takaichi has such strong support, especially among younger voters. Her approval reflects a desire for economic fairness and real wage growth.

 

Japan is also tired of doing nothing against foreign influences while its own people fall behind. Beneath the calm, a demand for change is growing.

 

That is the uncomfortable truth behind Japan’s affordability — and its awakening.