Over 80% of Japanese companies have limited or no AI adoption, Reuters poll finds

A Reuters poll reveals that over 80% of Japanese companies use artificial intelligence in a limited capacity or not at all, threatening efforts to improve Japan's labor productivity, which remains the lowest in the G7. Despite acute labor shortages and a projected deficit of 800,000 IT professionals by 2030, adoption is slowed by a risk-averse corporate culture, legacy IT systems, and a priority on maintaining full employment. Meanwhile, 82% of firms favor domestic investment, aligning with Prime Minister Sanae Takaichi's growth strategy.

Low AI adoption rates

• ▪A Reuters poll conducted by Nikkei Research between July 29 and August 6, 2026, found that over 80% of Japanese companies use artificial intelligence in only a limited capacity or not at all.
• ▪A 2026 Japanese government report showed that 86.4% of local firms use generative artificial intelligence for at least one task, lagging behind China at 98.1% and the United States at 90.9%.
• ▪An Organisation for Economic Co-operation and Development report from late 2025 showed that only 8.4% of Japanese workers use artificial intelligence at work, compared to 50% in the United States.
• ▪The Reuters poll of Japanese companies showed that 60% of respondents use artificial intelligence in limited ways, 18% have not decided on adoption, and 16% have deployed it company-wide.
• ▪Japan's Ministry of Finance reported that 75% of Japanese companies use artificial intelligence, up from 11% five years prior, though critics argue individual staff usage remains extremely limited.

Risk-averse corporate culture

• ▪Austin Xu, co-founder of Kuse AI, stated that a consensus culture and zero tolerance for mistakes in client-facing roles slow down artificial intelligence adoption in Japanese companies.
• ▪Approximately 60% of Japanese companies operate with out-of-date computer systems that are more than 20 years old, according to reports cited by Meiji University Professor Yasushi Ogasawara.
• ▪Professor Yasushi Ogasawara of Meiji University stated that Japanese companies prioritize maintaining full employment over implementing artificial intelligence systems that could result in job losses.
• ▪Parrisa Haghirian, a professor at the Kyoto University of Advanced Science, stated that Japanese firms limit generative artificial intelligence to low-risk tasks due to high sensitivity to reputational risk.

Productivity challenges

• ▪A Reuters survey showed that over 80% of Japanese companies use artificial intelligence in a limited capacity or not at all, a trend that could hinder official efforts to boost productivity.
• ▪Japan continues to experience the lowest level of labor productivity among the G7 group of advanced nations.

Labor shortages

• ▪Japan faces acute labor shortages, aging demographics, and a projected shortfall of almost 800,000 IT professionals by the year 2030.
• ▪Austin Xu of Kuse AI noted that some Japanese companies would rather leave a job role unfilled due to labor shortages than allow an artificial intelligence machine to handle it.

Government AI promotion

• ▪The Japanese parliament passed the AI Promotion Act in 2025, utilizing light-touch regulation to encourage business investment and make Japan a leader in utilizing artificial intelligence.
• ▪Prime Minister Sanae Takaichi's growth strategy vows to end excessive austerity and boost domestic investment in key areas including artificial intelligence, semiconductors, and quantum technology.

Domestic investment preference

• ▪A Reuters poll found that 82% of Japanese companies favor domestic investment over overseas investment, driven by the continued weakness of the Japanese yen.
• ▪In the Reuters poll, 41% of Japanese companies planned to increase domestic investment in the business year to March 2027, while 50% planned to keep it unchanged.