Japan’s hospitality and tourism industry is recovering, but there are challenges

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum./

Author: Naoko Kutty, Writer, Forum Agenda, Naoko Tochibayashi, Public Engagement Lead, World Economic Forum, Japan


  • Japan’s hospitality and tourism sector is recovering in earnest after reopening its border to foreign visitors and lifting mask rules after COVID-19.
  • As a result, March saw visitor numbers reach nearly 2 million, equivalent to about two-thirds of tourist figures for the same month in 2019.
  • Japan will need to adapt to avoid ‘overtourism’ and also address post-pandemic labour shortages in both hospitality and tourism.

The Japanese hospitality and tourism industry is beginning to recover in earnest after being badly hit by COVID-19.

In October 2022, Japan lifted the ceiling on the number of foreign tourists entering the country as well as the ban on the entry of individual foreign travellers, thereby significantly easing its pandemic border control measures. Furthermore, as of March this year, the rule to wear masks, both indoors and outdoors, is now left to individual discretion.

This was a tailwind, and the number of visitors to Japan in the same month quickly recovered to 1,827,500 – a figure is equivalent to 66% of the pre-pandemic March 2019 tally and 27.5 times higher than in March 2022.

By country/region, the largest number of visitors to Japan in March came from South Korea with 466,800 – or 79.7% of the figure for March 2019; followed by Taiwan with 278,900; the United States with 203,000, and Hong Kong with 144,900. In addition, since Japan eased travel restrictions from China on March 1, the number of travellers from the country almost doubled to 75,000 in February.

Takahide Kiuchi, Executive Economist at Nomura Research Institute, forecasts that “inbound demand for the year 2023 will be JPY 4,958 billion (about $36.7 billion), which could quickly surpass the JPY 4,813.5 billion (about $35.7 billion) inbound demand in 2019 before the COVID-19 pandemic”.

However, while Japan’s economy is being revitalized in earnest by inbound consumption – boosted in part by the record low yen, which makes Japan an attractive destination for foreign tourists – the country is facing a noticeable challenge as its readiness to receive tourists is not keeping pace with the speed of the recovery in visitor numbers.

Severe labour shortages in hospitality

The hospitality and restaurant industries are in a particularly tight spot, unable to cope with the resurgence of inbound tourism.

According to a January survey released by Teikoku Databank, the percentage of companies feeling a labour shortage (non-permanent employees) amounted to 81.8% for inns and hotels and 80.4% for restaurants. Of all sectors, these two industries in particular are experiencing an outstanding labour shortage, with the percentage for inns/hotels at an all-time high.

Many in the hospitality and restaurant sectors have been forced to reduce their workforce and curtail new hiring due to closures, shorter hours and poor performance caused by the spread of COVID-19, and many employees have moved on to other jobs. The fact it is not easy to bring back staff once they have left the industry is the main reason for the serious labour shortage.

Japanese industry has been trying to solve labour shortages by accepting foreign workers. The tourism sector has relied heavily on part-time jobs for foreign students. According to data from the Japan Student Services Organization in 2021, the hospitality and restaurant industries accounted for nearly 40% of all part-time jobs for foreign students. However, foreign student part-time workers have completely disappeared since the pandemic.

Furthermore, the depreciation of the yen, which has been progressing since the second half of last year, has significantly lowered wages in Japan from the perspective of other countries. Despite overcoming the COVID-19 crisis and embarking on a path of economic recovery, Japan is no longer attractive as a country to go to as a migrant worker, and it is no longer possible to expect to attract foreign staff.

In a bid to address the problem in hospitality, hotel operations are being reformed by using digital technology to increase efficiency. JTB, a major Japanese travel agency, has developed a platform that links its core system with digital tools such as ATMs to save labour in check-out and other operations, and is now offering the system to hotels.

Tokyu Hotels, which operates 45 hotels in Japan, has also introduced NEC’s Smart Hospitality Service, which enables automatic check-in using facial recognition and QR codes, at 39 of its hotels nationwide. Users can check in by simply holding up their face to a tablet terminal at the front desk if they have registered their guest information and photo in advance – making operations more efficient.

Countermeasures against ‘overtourism’

Overtourism has long been a challenge for the Japanese travel industry, and local residents in key tourist areas have suffered from issues including crowding, traffic congestion, rubbish and noise. The ability to diversify the times and areas visited by tourists is key to preventing overtourism, while allowing the tourism industry to gain momentum for a resurgence.

According to a Japan Tourism Agency survey, most people travel on holidays, including major national holidays, and only 16.5% of travel volume occurs on weekdays, which account for 70% of the annual number of days.

https://cdn.jwplayer.com/players/jjICPfVE-ncRE1zO6.html

As such, the government is working to diversify travel demand by increasing the amount of coupons granted for weekday travel in its nationwide travel support programme. Now that the spread of teleworking has made it feasible to combine work and travel on weekdays, the creation of new incentives, such as work holidays, could also help to balance out travel demand.

Diversification of tourist destinations is another important issue. Pre-pandemic, the occupancy rate of accommodation facilities in Osaka, Kyoto and Fukuoka – where tourists are concentrated – rose to nearly 80%, and the negative effects of overtourism were being called out.

However, in many prefectures located along the typical tourist routes for foreign visitors, the occupancy rate of accommodation facilities was less than 50%, resulting in regional differences. In the future, it will be important to bridge these regional differences by promoting Japan’s diverse destinations, and to increase the number of people visiting non-representative tourist destinations by attracting repeat visitors.

Looking to a new future for Japan tourism

The World Economic Forum’s Travel & Tourism Development Index 2021: Rebuilding for a Sustainable and Resilient Future ranked Japan first in the development index ranking due to the speed with which the travel and tourism industry has recovered from the devastation caused by the pandemic.

Assuming that the travel and tourism industry will play an important role in global economic and social development, the report emphasizes that investment in the drivers of the industry’s development will be crucial in the future.

Meanwhile, Atsushi Takahashi of JR East Japan Planning Incsounded an alarm bell on the past Japanese approach to tourism and instead urged a new way of thinking. “We have long made decisions based on intuition, experience and assumptions. We have been making decisions for a long time without looking at data,” he said.

“The original marketing is to choose the best solution at the time from multiple hypotheses that emerge depending on how the data is viewed and interpreted. However, in the field of tourism, I feel that this is still too shallow.”

His observations stress his belief that data-based initiatives in Japan’s tourism industry are also essential to solving issues facing the sector today, as well to providing new forms of tourism services altogether.

Pre-pandemic, China ranked first in the number of foreign visitors to Japan by nationality and region, accounting for a 25.6% share. Currently, there are restrictions on issuing tourist visas to Chinese nationals, but if these restrictions are lifted in the future, the number of visitors from China is expected to increase rapidly.

In addition, the Expo 2025 Osaka Kansai – which will be held for six months and centre around the theme of ‘Designing Future Society for Our Lives’ – is expected to attract 3.5 million foreign tourists.

With these expected surges in visitor numbers, the question will be how Japan can solve the problems facing hospitality and tourism, while also creating and providing services that place value on new forms of tourism.


Discover more from The European Sting - Critical News & Insights on European Politics, Economy, Foreign Affairs, Business & Technology - europeansting.com

Subscribe to get the latest posts sent to your email.

Interesting reads

© WFP/Michael Castofas WFP staff and responders handle boxes of supplies at a logistics site in DR Congo during the Ebola outbreak.

International airlines urged to stick to safety measures in wake of Ebola outbreak

This article is published in association with United Nations. As a deadly Ebola strain continues to spread in the Democratic Republic of the Congo (DRC), with cases confirmed in neighbouring Uganda, the UN aviation agency is urging governments and flight operators to closely follow guidelines put in place following the COVID-19 pandemic. The outbreak of the […]
© WHO Supplies to bolster the response against the Ebola outbreak in Ituri province arrive in the town of Bunia.

Ebola epidemic spreading rapidly and outpacing containment efforts

This article is published in association with United Nations. There are more than 900 suspected cases of the Bundibugyo strain of Ebola in the Democratic Republic of the Congo, and 220 suspected deaths, the head of the World Health Organization (WHO), Tedros Ghebreyesus, said on Monday. The latest outbreak of the deadly disease, which WHO has declared […]
This article is published in association with United Nations.

WHO chief calls for urgent Ebola action and pandemic preparedness

This article is published in association with United Nations. The recent Ebola and hantavirus outbreaks demonstrate that the world is still vulnerable to rapidly spreading infectious diseases, Tedros Ghebreyesus, the head of the World Health Organization (WHO), warned on Saturday at the close of the 79th World Health Assembly in Geneva. His call came as Ugandan […]
This article is published in association with United Nations.

UN agencies step up Ebola response in eastern DR Congo

This article is published in association with United Nations. United Nations agencies have moved swiftly to support efforts to contain the latest Ebola outbreak in eastern Democratic Republic of the Congo (DRC), delivering emergency medical supplies, protective equipment and logistics support. As health authorities in both the DRC and Uganda respond to the deadly resurgence, the […]
© UNICEF/Josue Mulala Emergency aid is prepared for delivery to Kasaï province in response to the recently declared Ebola virus disease outbreak in DR Congo.

Ebola risk is high inside DR Congo but it’s no pandemic emergency: WHO

This article is published in association with United Nations. The deadly Ebola outbreak in Democratic Republic of the Congo (DRC) and Uganda does not represent a global pandemic emergency, although the risk is high at a regional and national level, the UN health agency chief said on Wednesday. In an update on the fast-developing situation in […]
This article is published in association with United Nations.

How the Hormuz crisis keeps disrupting kitchens, ports and paychecks

This article is published in association with United Nations. The fragile ceasefire between the United States and Iran may have eased fears of a wider regional war, but persistent instability around the Strait of Hormuz continues to disrupt global trade, drive up energy costs and fuel a growing jobs and cost-of-living crisis. The fallout is being […]
© UNFPA Ukraine In March 2026, a maternity hospital in Odesa, Ukraine was attacked by Russian forces.

World News in Brief: More attacks in Ukraine, violence against children in Haiti, refugee IDs in Africa

This article is published in association with United Nations. Civilians, including humanitarians, continue to face great danger across war-torn Ukraine amid ongoing hostilities, according to the UN humanitarian relief coordination office there, OCHA. Over the past three days, frontline attacks killed at least 11 civilians and injured nearly 200 others, including five children, as reported by […]
UN Photo/Milton Grant Sculpture depicting St. George slaying the dragon. The dragon is created from fragments of Soviet SS-20 andUnited States Pershing nuclear missiles.

Nuclear terror threat ‘has never been so high’

This article is published in association with United Nations. The widespread availability of new technology, such as militarised drones and artificial intelligence, means that the current threat of nuclear terrorism is higher than it has ever been. The humanitarian, environmental, and economic consequences of a radiological or nuclear terrorist attack would be global, undermining international peace […]
© UNICEF/Nyan Zay Htet Recent disruptions to energy supplies and global supply chains have reverberated across development and humanitarian sectors, including relief efforts in Myanmar, where millions remain in need of assistance.

Global energy and trade disruption pushing millions towards poverty

This article is published in association with United Nations. Disruptions to global energy supplies and trade corridors are driving up the cost of food, transport and essential goods worldwide, slowing economic growth and increasing pressure on vulnerable households and debt-strapped developing countries. The warnings came during a special meeting of the UN Economic and Social Council […]
UN Photo/Eskinder Debebe UN Relief Chief Tom Fletcher (centre) along with Ambassador Mike Waltz (right) and Jeremy P. Lewin of the United States hold a joint press briefing on funding to the humanitarian system.

UN welcomes $1.8 billion US boost for humanitarian operations

This article is published in association with United Nations. An additional $1.8 billion in US humanitarian funding will allow the United Nations and its partners to expand emergency relief operations reaching millions of people worldwide, as rising global needs and funding shortfalls force aid agencies to scale back assistance. The funding announcement, made on Wednesday by […]
© WHO/Hanan Balkhy Displaced families are living in overcrowded tents and makeshift shelters, surrounded by waste and debris, with limited access to safe water and sanitation services.

World News in Brief: Mounting waste in Gaza, drone attacks in Sudan, aid truck struck in Ukraine

This article is published in association with United Nations. Mounting waste and limited access to sanitation sites are deepening health risks for families across Gaza, as humanitarian workers warn that overcrowded dumping areas and worsening living conditions threaten vulnerable communities. Ramiz Alakbarov, UN’s top aid official in Occupied Palestinian Territory visited a dumping site in Gaza […]
This article was exclusively written for The European Sting by Mr. Franco Miguel Nodado, a 4th-year medical student from the Philippines. He is affiliated with the International Federation of Medical Students Associations (IFMSA), cordial partner of The Sting. The opinions expressed in this piece belong strictly to the writer and do not necessarily reflect IFMSA’s view on the topic, nor The European Sting’s one.

Autism Spectrum Disorders in Global Health: Bridging the Gap in  Awareness, Early Diagnosis, and Inclusive Care 

This article was exclusively written for The European Sting by Ms. Georgia Maria Vardalachaki, a medical student from the Medical University of Crete, Greece. She is affiliated with the International Federation of Medical Students Associations (IFMSA), cordial partner of The Sting. The opinions expressed in this piece belong strictly to the writer and do not necessarily reflect IFMSA’s […]
© WHO/Hedinn Halldorsson WHO Director-General Tedros and a health expert during operations involving the MV Hondius off Tenerife amid the hantavirus response.

Hantavirus-hit ship evacuation completed as quarantines begin

This article is published in association with United Nations. The passengers and crew have disembarked from the hantavirus-hit cruise ship MV Hondius in Tenerife and many have returned to their home countries, as the UN World Health Organization (WHO) said the operation demonstrated a “triumph of solidarity”. The repatriation effort, coordinated by Spanish authorities with support […]
© NASA The Strait of Hormuz which separates the United Arab Emirates and Iran is a strategically important shipping route

Strait of Hormuz de-escalation is urgent, says UN chief

This article is published in association with United Nations. As the Strait of Hormuz crisis deepens and tensions between Iran and the United States remain unresolved, oil prices rose again early Monday, prompting the UN Secretary-General to call for a peaceful resolution and warn of the widening fallout across Africa and beyond. “My strong appeal is […]
This article is published in association with United Nations.

Ukraine: Over 3,000 attacks on healthcare since full-scale Russian invasion

This article is published in association with United Nations. The World Health Organization (WHO) has verified more than 3,000 attacks on healthcare in Ukraine since Russia launched its full-scale invasion in February 2022, the UN agency reported on Friday. “During 1,534 days of war, Ukraine’s healthcare system has experienced repeated attacks,” it said.  Every aspect of the system has been […]
WHO Passengers from MV Hondius assisted by Spanish and WHO health teams after disembarking.

Passengers leave hantavirus-hit cruise ship in Tenerife as WHO says outbreak ‘not another COVID’

This article is published in association with United Nations. Passengers and crew from the cruise ship MV Hondius began disembarking in Tenerife on Sunday under a tightly coordinated international health operation led by Spanish authorities and the World Health Organization (WHO), as officials sought to reassure the public that the outbreak “is not another COVID.” The […]
Nuclear energy in the Middle East: A realistic choice or a risk?

Nuclear energy in the Middle East: A realistic choice or a risk?

This article is published in association with United Nations. As global electricity demand grows, so does the popularity of nuclear energy. In the Middle East, several countries are evaluating or advancing nuclear power projects, balancing weighty issues such as regional security, climatic conditions and international cooperation. “Nuclear energy is at the intersection of energy demands, technological […]
© NASA The Strait of Hormuz which separates the United Arab Emirates and Iran is a strategically important shipping route

Bahrain and US float Security Council resolution on the Strait of Hormuz

This article is published in association with United Nations. Bahrain and the United States have circulated a draft Security Council resolution calling for Iran to cease attacks in the Strait of Hormuz, their ambassadors outlined to journalists at UN Headquarters in New York on Thursday. The text is supported by Kuwait, Qatar, Saudi Arabia and the […]
© CDC An enhanced microscopic image shows the Hantavirus.

Hantavirus outbreak: Another passenger contracts disease

This article is published in association with United Nations. It’s been confirmed that another passenger from the cruise liner linked to the outbreak of hantavirus has contracted the disease, which has claimed the lives of three people on board and sparked an international alert coordinated by the UN World Health Organization (WHO). The individual, who is […]

Why don't you drop your comment here?

Go back up

Discover more from The European Sting - Critical News & Insights on European Politics, Economy, Foreign Affairs, Business & Technology - europeansting.com

Subscribe now to keep reading and get access to the full archive.

Continue reading

Discover more from The European Sting - Critical News & Insights on European Politics, Economy, Foreign Affairs, Business & Technology - europeansting.com

Subscribe now to keep reading and get access to the full archive.

Continue reading

The European Sting – Critical News & Insights on European Politics, Economy, Foreign Affairs, Business & Technology – europeansting.com