Dismay rippled through Japanese society over the summer after the venerated University of Tokyo lost its number one ranking, falling to number seven, in the Asia university rankings published by the Times Higher Education of London.

The University of Tokyo (known as Todai in Japan) occupies a cultural space akin to Harvard, Princeton, and Yale combined in the United States. It is the launching pad for those who go on to run the country’s elite institutions. After the rankings slip, many Japanese felt that the country itself—not just its university—had taken a tumble.

Todai’s defrocking is emblematic of a broader problem. Japan’s educational system is failing to keep pace with changes taking place in Japan and in the rest of the world. Its drop in the rankings was due to funding cuts, poor research output, and an insufficiently global “outlook.” In 2013, Japan spent 1.6 percent of its GDP on tertiary education, compared to 2.4 percent in South Korea and 2.6 in the United States, according to the OECD. Optimized for an earlier industrial age, anachronistic educational institutions are struggling to adapt to a globally competitive marketplace for students, faculty, funding, and jobs.

No wonder that in interviews, educators and students use language frighteningly similar to that which a prisoner might use to describe his or her own predicament: “trapped,” “suffocating,” “stuck,” and “wanting to escape or sneak out.” Hardly the “bright college years with pleasures rife,” as the Yale song goes.

Getting education right has to take top priority. First, along with the family unit, a country’s schools hold the special responsibility of developing the minds and values of its youth. Since a majority of Japanese adults attend college (60 percent of 25-34-year-olds have completed tertiary education, the second highest level in the OECD after Korea), the education system has enormous potential to be a positive force for dynamism.

Second, quality education is essential for safeguarding Japan’s role in the world and for fostering a more dynamic economy at home. Over the past four years, the limits of Prime Minister Shinzo Abe’s economic stimulus program—Abenomics—have become clear. Fiscal and monetary policy can only do so much to promote economic growth. Meanwhile, Japan’s population has begun shrinking, which has further crimped growth potential. So if it wants to boost economic growth, Japan has no choice but improve productivity, which has been the lowest in the G-7 for 30 years. Output per hour in Japan was $41.30 in 2014, compared with $65.20 in France and $64.40 in Germany. And Japan’s labor market has the largest skills mismatch in the Asia Pacific region, according to a new report by Hays recruitment agency; the index identifies a large gap between what companies are looking for in Japan and what skills the labor force offers. Labor reform and more efficient labor practices in the workplace will be essential to improving productivity, meaning universities must promote critical thinking, innovation, and global-mindedness.

A student studies in the Institute Library at Tokyo Institute of Technology in Tokyo, Japan July 14, 2016. Toru Hanai / Reuters The symptoms of a flagging education system run much deeper than a drop in university rankings. According to the OECD’s “Education at a Glance 2016” report, Japan is failing to meet many other important targets as well. The report describes the international mobility of Japanese tertiary students as “stagnant,” at only 0.9 percent enrolled abroad in 2014 (that’s a little more than half of the OECD average). Similarly, the proportion of tertiary students studying in Japan from abroad was three percent, or half the OECD average. Finally, according to a survey conducted by Education First, Japan ranks 30 out of 70 in English proficiency.

Meanwhile, Japan is vastly underutilizing its female working population: it has the largest gap between the number of women and men in engineering among OECD countries. The OECD study concludes that the ratio of female tertiary graduates in engineering, sciences, business, and law is “particularly low,” and that the gender gap in employment rates and salaries is “much larger in Japan than in other OECD countries.” In 2016, Japan was ranked 111th out of 144 countries in gender equality, according to the World Economic Forum, dropping ten spots from 2015.

Japanese universities are failing so miserably in fostering critical thinking, global outlooks, and competitiveness that former Osaka University professor Kevin Rafferty hyperbolically suggested that “mass seppuku”—ritual suicide—“by university presidents” would be a reasonable response to their drop in global rankings, as he wrote this fall in a Japan Times article that made a huge splash on social media.

Finding a fix for the education system will not be easy. As in many countries, the first instinct is to throw money at the problem, and that’s exactly what the Japanese government has been doing. From 2009 to 2014, the government’s Global 30 Project funded 13 universities to promote a more global outlook through partnerships with universities in other countries, new courses in English, and encouragement for Japanese students to study abroad. But the Global 30 only created isolated, one-off “island projects” rather than systemic change in the broader curriculum. It was therefore deemed a “total failure,” according to comparative education expert Shingo Ashizawa of Toyo University.

So in 2014, Tokyo replaced the Global 30 with a new program, the Top Global University initiative, which looked to finance more programmatic changes in 37 universities for the next ten years. Ashizawa, who is a grantee of the program, is hopeful, but he told me that the jury is still out on whether the approach will work. A risk is that the government is keeping universities dependent on it for funding.

The Japanese educational system was set up to support social order, industrial prowess, and political stability.

Another initiative led to a new set of English curriculum guidelines that was implemented in secondary schools in 2013. Yet English-speaking skills have remained unchanged among high school students. A more ambitious set of guidelines is in the works, but it won’t be implemented until 2020. According to an education ministry survey of 90,000 students at 500 public high schools and of 60,000 students at 600 public junior high schools, the students on aggregate missed government targets for all four English language skills : reading, writing, speaking, and listening.

What’s going on? The problem is, in many ways, structural. The Japanese educational system was set up to support social order, industrial prowess, and political stability. Although Japanese students rank among the top in the OECD for math and science, liberal arts and humanities are languishing. Yet they are critical to the growing creative industries of the future. The government is aware of this challenge. “The ability to collaborate with diverse people” is what will be important, former Deputy Minister of Education Suzuki Kan told me. “Japanese people are good at solving questions that they are given. They are passive and diligent. But with the digital economy, that work will be replaced by artificial intelligence. So human work will be totally changed—becoming creation, creation, creation. Not routine work.”

Recent developments are not encouraging. There was a minor meltdown in humanities and liberal arts departments last year after the Japanese government told its 60 national universities to divert resources toward areas that “better meet society’s needs.” Japan also has a glut of universities (about 200 too many) due to a declining student population, so existing institutions are desperate for students and are lowering their standards. Finally, there is no strong incentive anywhere in the system to adapt. As a result, the education system is lagging behind the rest of society.

“Our education system is not working. The education ministry knows something is wrong but they don’t look at the big picture; they are only doing patch work,” Kumiko Aoki, an expert on learning technology and higher education at the Open University of Japan, told me. She concluded that the Japanese education system effectively turns people into unquestioning “robots” who are blindly loyal to their companies. Her comments support the sentiments of many others who said that the changes in the education system over the past 20 years have been insufficient at best.

A student job seeker walks along a corridor at a convention center in Tokyo, Japan, March 28, 2016. Yuya Shino / Reuters Meanwhile, there’s a mindset issue. Although younger people have become more accepting and tolerant of different people and lifestyles, their behavior has become more conservative, due to anxiety about the future and fears about world chaos, brought home via the Internet. In contrast to these anxieties, Tokyo has been ranked the safest city on the planet, and life is relatively comfortable and predictable in Japan. Students in Japan forgo study abroad to step onto the career “escalator” of incremental advancement. Smartphones and popular communication apps, such as Line, have created tight-knit yet insular and homogeneous groups that are increasingly uninterested in the rest of the world. Even attention to Western popular culture has fallen, according to visual culture expert Michio Hayashi, who is the liberal arts dean at Sophia University in Tokyo.

“Why don’t people ask questions in Japan?” government special adviser William Saito asked me rhetorically. “In the U.S., you’re taught, ‘there are no stupid questions.’ In Japan, it’s 180 degrees the opposite. You’re taught in Japan not to question authority, so by the time you are an adult you don’t even know how to do it,” Saito, who serves on two government educational advisory councils, explained. “People in their 20s might ask questions, but by their 30s they get so beaten down that they are basket cases. It is the modern business culture here.”

Aoki voiced something similar: “The goal of education hasn’t been to equip people with tools but rather to make people passive and obedient. Anybody who sticks out will be hammered down. In Japan, wa­”—harmony—“is important. The education system enforces it. I don’t know which is first—culture or education? It’s a chicken-and-egg problem.”

Saito expressed concern that the system still prioritizes rote memorization over creativity in an age when it’s futile to compete with Google on knowing facts and figures. “You will either use or be used by computers. Trying to compete with computers is inefficient. Imagination, serendipity, and how to learn are the things that are not being taught,” he said. Saito even said that some parents told him that they are refraining from having children because they would rather not subject them to the Japanese education system. In a country that has one of the lowest birthrates (at 1.41) in the world, that was especially troubling to hear. Experts have pointed to many reasons for the falling birthrate, including lack of childcare, delayed marriage, increased rates of abstinence among adults, the availability of pornography, and many other factors. Saito’s comment pointed to yet another, and his word is very credible, as he visits families all over Japan constantly.

Perhaps the best illustration of the myriad problems of Japan’s education system is the college entrance exam. It is the one test that can determine the rest of a Japanese student’s life, and each year approximately half a million Japanese high school students take it. The level of a student’s performance on the exam places him or her in a corresponding university, ranked by level of prestige.

Universities are then used as feeders for recruiters, who mostly care about which university a potential recruit attended rather than what he or she did during school. Even grades are seen as meaningless. That means that students have little incentive to learn and instructors little incentive to teach. As a result, universities have become a “leisure land” for students, according to Ashizawa. Several students from a variety of universities also told me that the main role of a professor was to use his or her corporate connections to land a job for students.

The third year of university brings the dreaded job hunting process, which students describe as soul crushing, with lasting effects throughout adulthood. This process is a pivotal part of the educational experience. “The recent attitude among young people is to just try to get a stable job in Japan and hold on tight. Young people have become more conservative,” Hosei University director Yoshiyuki Hino told me. “Students have become very anxious about job hunting. Job hunting for Japanese is completely different; it is a one-time opportunity. If they fail, they never recover.”

That feeling was borne out in discussions with students. “The job hunting process is terrible because there are unwritten rules that we must follow. For example, we always have to wear black suits everywhere,” Shingo Tejima told me. Tejima is a university student who had just finished the job search process, securing a position at a travel company. He speaks three languages and had spent time abroad studying in Los Angeles. “Before job hunting, I was much more outgoing and open. Afterward, I was depressed, nervous, and stressed all the time. Now I am getting better, but I will never be the same…. When I came back from study abroad, I had hopes, and thought I could do anything. Now that I have done job hunting, I feel I have to work for years. I kind of feel trapped.”

Tejima described having to skip class—a common occurrence—to attend dreary corporate information sessions that young adults must endure during the process. “Attending all those seminars, I had to do this and that. I felt I was nothing. All the things I learned in college… the seminars made me feel like I had nothing. Overall, I felt stressed and angry,” he said. The rigidity of this system has discouraged students from studying abroad and pushed one in five to consider suicide, according to the nonprofit Lifelink.

To be sure, some changes are afoot. During a recent trip, I met with Tsunenori Ishioka and Hiroki Yamaji. They are among the 94 employees of Japan’s National Center for University Entrance Examinations, the organization responsible for administering the exam and also tasked with revamping it by 2020. The government wants the exam to do a better job of testing critical thinking and communication in English. The center is an independent administrative corporation, a kind of hybrid public-private company that must follow government edicts, but gets no public funding. Its staff must revamp and test the new exams while simultaneously continuing to administer the current exams with the same number of employees.

Although it is commendable that the government is pushing bold changes in the entrance exam, Ishioka and Yamaji expressed several concerns. One was the risk that high school students would simply skip the written essays in favor of doing what they know—multiple choice—in the interest of time. Also many teachers doubt they have the capacity to prepare the students for the new exams. Another problem is that the center is under enormous political pressure to produce positive results from the trial tests, creating frustration among educational professionals. “Every stakeholder is anxious,” they told me.

Some people expressed optimism about education in Japan although it was difficult to know whether they were in denial. Advocates of the education system all pointed to the 2016 Nobel Prize in Medicine, which was awarded to Japanese scientist Yoshinori Ohsumi. Yet even Ohsumi used the occasion to express publicly his concern about the direction of research in Japan toward short-term outcomes and away from the long-term approach that allowed him to take 20 years to achieve his breakthroughs.

In terms of Nobel laureates by country as a percentage of population, Japan comes in at number 39, behind Belarus, Costa Rica, and Romania.

Also noteworthy was who did not win a Nobel this year: the Japanese favorite for the literature prize, Haruki Murakami. The prize instead went to American songwriter Bob Dylan. Only two Nobel Prizes in Literature have ever been awarded to Japanese authors. Japan ranks seventh in terms of total Nobel Prizes, behind the United States and five European countries. In terms of laureates by country as a percentage of population, Japan comes in at number 39, behind Belarus, Costa Rica, and Romania.

The new standards for English proficiency in the entrance exams may create business opportunities. One of the most hopeful people I met during my trip was Hiro Imai, the CEO of the after-school English language company Justy Co., along with his executive vice president Ichiro Kaneko, at their offices in the well-to-do residential neighborhood of Meguro in Tokyo. Justy educates Japanese high school students for English proficiency, filling a vacuum created by a public school system that’s poorly suited to the task. They have been in business for ten years and are now opening one or two new schools each year in Tokyo. “We feel a very strong demand for our services,” Imai said, noting that the biggest change he has seen over the past ten years has been that parents now feel the need for their children to attain English proficiency.

“Year 2020 is just a starting point for dramatic changes in education that will take place over ten to 20 years,” Imai continued. “I am already planning for post-2020: how to use online systems for English teaching and assessment systems for a large pool of students; and how to use English content such as textbooks. I’m optimistic as I am positioned to offer solutions. That’s all I think about.”

As universities launch new study abroad initiatives, some individuals are addressing the lack of interest in traveling outside Japan. William Saito, the government adviser, has been devoting his business profits toward sending young Japanese abroad to expand their horizons. “Tokyo is a bubble; it’s hard to see it for what it is. I send students overseas, and they become ambassadors about the real state of the world. It’s about performance and competition. It’s not about ‘staying with my parents at home,’ ” he said. “My experiment is working, in that now I have about 95 kids who come back and say, ‘The world is different!’ ” Saito believes these types of initiatives can gradually change the attitudes and behaviors of young people.

The single most common suggestion I heard during my trip was to expose young Japanese adults to new ideas. Getting young Japanese exposed to diverse backgrounds—anything outside of Japan—would help create different ideas of what’s possible and alter the peer pressure to stay at home. “All you need to do is to pay for a one-way ticket to a foreign country. I am hearing about more and more people who on a lark go somewhere like Iowa, put their time in, transfer to Stanford, and it changed their life!” Saito exclaimed. “A lack of diversity is killing the economy.” Without those more diverse experiences, the country risks proving the Japanese proverb: “A frog in a well does not know the great ocean.”