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When Parasite won the Oscar for Best Picture last month, South Koreans were elated.

Everyone from the nation’s president to humble rice store owners celebrated in Seoul, Busan, and across the Korean diaspora, reveling in a truly unique accomplishment: that the first non-English-language film ever to win Best Picture at the Academy Awards was a Korean one.

But a few hundred miles east, Parasite and director Bong Joon-ho’s victory forced Japanese filmmakers and critics to reconsider the state of Japanese cinema — an industry that has arguably been in decline since the mid-20th century, when directors like Akira Kurosawa and Yasujirō Ozu transformed global cinema forever.

“Despite the groundbreaking success of anime, Japanese live-action movies haven’t gotten attention since as far back as Kurosawa,” wrote film journalist Tsukasa Shirakawa days after Parasite’s win. “It’s left us wondering why.”

“Japanese cinema” (日本映画) was trending on Japanese Twitter right after the Oscars, with cinephiles and film directors alike airing grievances about a film industry that is deeply flawed despite ample talent and a global appetite for Japanese goods.

“Korea has been making world-class movies for decades, but Japan either can’t or won’t do it,” one cinema enthusiast tweeted.

“The thing that makes me upset is that if you go back 30 years, Japanese movies, just like Korean movies today—or even more so—were huge critical successes overseas and had an influence” on global cinema, added Satoru Murata, a DJ and photographer.

“South Korea’s soft power is eclipsing Japan’s,” New York Times reporter Hiroko Tabuchi tweeted.

Parasite won the International Feature Film Oscar and went on to take Best Picture; Japan’s hit anime film Weathering With You failed to make the International Feature Film shortlist. K-pop is a worldwide cultural phenomenon; J-pop has an international hit once or twice per decade. New York’s trendiest restaurants these days are Korean, not Japanese.

The story of Japan’s soft power, loosely defined as economic and cultural influence in international relations, is a complicated one. Despite the poor conditions for many creatives, Japanese products have become uniquely ingrained into American and global pop culture, paving a strong path forward for Japanese cinema if the industry is able to change.

The real “threat” to Japanese soft power is not the rise of South Korean pop culture or the whims of American taste, but economic issues on the ground: struggling studios and exploitative working conditions.

South Korea seized the world cultural stage by investing in technology and talent

South Korea’s entertainment and culture industries are aggressively funded, cozy with the government, and well versed in global pop and cinema genres.

A victory like Parasite has long been in development for South Korea. Michelle Cho, professor of East Asian studies at the University of Toronto, told me that the media and entertainment industries in South Korea have been heavily pushed to globalize in the past 20 years.

Throughout the 1990s and early 2000s, increased investment by the government and corporations in high-tech internet infrastructure and top-notch research and development, production, and design all contributed to building up cutting-edge entertainment products.

“Financial support from state entities like the Ministry of Culture offer marketing and intermediary support for distribution as well as funding for film festival infrastructure,” Cho said. “Government support has helped Korea become the renowned center for Asian filmmaking.”

Cho said that Korean entertainment products’ use of familiar pop genres helps explain their widespread appeal. “Korean movies speak to a US genre entertainment audience,” Cho said. That audience includes horror fanatics as well as viewers who embrace the Asian exploitation genre of Quentin Tarantino films — films like Old Boy and Memories of Murder.

“You also hear about how K-pop’s innovation is the way it mixes musical genres,” Cho said. “A K-pop song is designed to incorporate as many musical genres as possible, and that’s what excites the ear.”

Korea’s well-funded entertainment product is the ideal cultural export, mixing elite talent and production with familiar and exciting genres. The results speak for themselves. K-pop superstars BTS joined Lil Nas X to perform “Old Town Road” at the Grammys, for heaven’s sake.

Worker exploitation plagues Japan’s creative industries

South Korean films are well-funded in general and the industry has seen drastic improvements in working conditions over the past decade. In the production of Parasite, contracts for each individual ensured a maximum 52-hour workweek, minimum wage, overtime fees, and meal breaks.

That stands in stark contrast to Japan’s film industry, where worker exploitation is common practice.

“A discussion panel at the Tokyo International Film Festival several years ago promoted Japan as a film location by saying that the benefit of shooting in Japan is that crews are able to work late nights and long hours with no overtime,” Hiro Masuda, producer at Ichigo Ichie Films, a Japanese-international production company based in Tokyo, told me.

This, he said, is “a typical mentality of the ‘Cool Japan’ initiative.”

“Cool Japan” is a Japanese government initiative launched in 2012 to promote Japan’s creative industries abroad. It was derided by artists from the moment it launched for driving profit to advertising agencies that worked on the initiative rather than artists and has failed to fund programming that supports strong creative work.

According to data from Career Garden, a Japanese website providing information to job seekers, non-directorial positions at film studios in Japan earn around ¥200,000 per month (~$1,850 US, or $22,200 US annually). Meanwhile, film directors with steady careers earn about ¥4 million annually (~$37,000 US). Enough for a stable lifestyle, but still well below the median household income in Tokyo.

“People working in the Japanese film industry are under severe conditions,” Erina Ito, a film reporter for Japan’s Asahi Shimbun newspaper, told me. “Young people are obliged to labor for low wages and long hours. I know many talented people who had no choice but to quit their job because of these conditions.”

In anime, working conditions may be even worse. Junior animators are paid as little as $2 per drawing — each of which can take an hour or more. An outdated industry model sends all of the profits to distribution and merchandise companies, leaving animators with almost nothing.

World-renowned Japanese director Hirokazu Kore-eda gave an interview in 2016 decrying the state of Japanese cinema. Even Kore-eda — who went on to win the Palme d’Or at the 2018 Cannes Film Festival for his acclaimed film Shoplifters, which subsequently earned Japan an Oscar nomination in the Best International Feature category — struggles to raise funds for his movies.

Kore-eda criticized “Cool Japan” for its arbitrary and ineffective initiatives, best represented by the Japan Day Project (another government-run PR initiative), which brought Kumamon, Kumamoto Prefecture’s adorable bear mascot, to a tuxedo party at the Cannes Film Festival in 2015.

“You can’t just go to Cannes, take photos with Kumamon, and say ‘Cool Japan,’” he said. “We have to actually support artistic talent.”

In addition to the poor working conditions, public film funding in Japan implicitly discourages filmmakers from more daring political themes and messages in their work.

“Grants from the Agency of Cultural Affairs are influenced by the content of the proposed film,” Ito said, “so filmmakers tend to regulate their expressions in ways that prevent them from drawing on political themes.”

It’s uncommon to see social critiques like Parasite in Japanese theaters. And while Shoplifters may be an important exception with its spotlight on poverty, Japanese Prime Minister Abe Shinzo ignored its success, not even giving Kore-eda a congratulatory call — most likely because of the movie’s social themes.

Japanese director Tadao Satō recently noted that in the golden days of Japanese cinema, movies pulled in ample profits, funding the budgets of artistically ambitious films.

“But today, young filmmakers are not happy with the kinds of movies produced,” Satō said. “Without a way of making profitable films, we haven’t reached the next stage, which would be to invest the profits to make high-quality artistic films that boost the prestige of studios.”

Japanese products have made their way into global pop culture for centuries — but influence is cyclical

Especially in comparison to South Korea’s growth, Japan’s cultural exports in movies and music generally remained stagnant from 2005 to 2012. A recent spurt of growth in cultural exports since 2013 can be more or less entirely attributed to anime.

Poorly funded live-action products made for Japanese markets by underpaid and overworked employees, unsurprisingly, haven’t succeeded in droves abroad.

But Japanese products have made their way into global pop culture for centuries. “Japanese ‘soft power’ has been on a slow burn since Japonisme,” said Kerim Yasar, a professor of East Asian studies at the University of Southern California, referring to the late-19th-century interest in Europe in Japanese art and design.

“There have of course been cyclical peaks and troughs since then, but it always seems to keep coming back,” Yasar added.

In the 1990s, for example, the Japanese economy crashed, and Japanese influence was perceived as on the decline. Modes of Japanese pop culture that later captivated so many 21st-century Americans — namely anime, manga, and video games — were a part of youth cultural markets that Americans initially derided.

“There are plenty of instances where American journalists went to Japan in the ’90s and essentially made fun of the youth culture, the shows and the games,” said David Marx, author of Ametora: How Japan Saved American Style.

“At first, we all made fun of Nintendo games — they were weird, the logic was weird. A lot of music coming out of Japan was also on a totally different vector than American music — avant garde noise groups that influenced bands like Sonic Youth,” Marx said.

But in the late ’90s, those weird shows and games started to stick in the US. Japan’s avant-garde scenes also made a significant impact abroad by experimenting with Western genres like punk rock and street fashion. “Cool Japan” as we know it was born — and certainly not because of any government initiative.

“Hollywood produced Ghost in the Shell, most people know that Transformers was originally Japanese, and everyone acknowledges that Hayao Miyazaki is the living master of animation,” said Roland Kelts, author of Japanamerica.

“Korean pop culture is fantastic, but categories of Japanese [intellectual property] like Nintendo and Ghibli reach audiences when they’re young,” Kelts said. “When you’re a kid and you get into Pokémon, you’re a fan for life. It will never let you go.”

In the 2000s, as the Japanese economy and middle class continued to contract, many of Japan’s diverse, niche subcultures began to vanish. Devoted otaku collectors of manga and anime genres such as moe that focus on depicting adolescent girls (which can verge on the pornographic and even pedophilic) became the residing pop-culture-in-chiefs by lack of competition.

“Since then, niches have further consolidated into mass culture, producing one mega-hit or two each year that everyone watches or reads,” Marx said. “It’s not too different from what we see the US.”

Japan and South Korea can both succeed. But Japan’s film industry still has a lot of work to do to thrive again.

Whether or not a Japanese film is able to win an Academy Award, South Korea’s entertainment industries can serve as a successful model for Japan’s flagging film industry.

“It’s also critical to remember that soft power isn’t a zero-sum game. That Korean pop culture is thriving around the world doesn’t come at the expense of Japan’s, or any other country’s culture,” said Matt Alt, an author and translator specializing in video game work.

Cho agreed that soft power isn’t a zero-sum game, but said that what is limited is what she called “Euro-American attention.” “This sense of competition is premised on the idea that North Americans don’t know how to differentiate between Asian cultures,” Cho said. “However, I think this is changing.”

“There’s room for more than one country to be a global influencer in Asia. Japan has just become softer and more sophisticated, and Korea is more cutting-edge, more youthful,” Marx said.

Soft power has opened space for Japanese cinema in the hearts and minds of Americans — more and more Americans congregate around cult favorites like Cowboy Bebop and Satoshi Kon films with each passing year — but the live-action film industry continues to struggle.

Envy from Japanese filmmakers does not come from a sense of competition with Korean filmmakers — on the contrary, Japanese creatives rallied behind Parasite director Bong Joon-ho — but instead is born from the reality that they struggle with poor working conditions in an industry seen flourishing overseas. The stakes for their livelihoods and their work are pressing.

“The creative industry is a people’s industry,” Masuda said. “If you don’t treat each film crew respectfully, you won’t have an industry that the next generation wants to work for. Unfortunately, the failure of ‘Cool Japan’ is [a major factor in] why we don’t see improvement in the below-the-line work environment.”

The Japanese film industry also tends to drive out women. “In Japan, parenting remains largely the responsibility of women,” Ito said, so “it is very difficult for female filmmakers to keep their careers.” This is a shame especially considering the industry’s talented women directors, such as Mipo Oh, Yūki Yamato, and Yoko Yamanaka.

Ito said there is still a bright future for the industry — if Japan’s talented young filmmakers can find funding abroad. “In my opinion, a Japanese hit like Parasite is impossible,” she said.

The most damning indictment comes from none other than Kore-eda, the legendary filmmaker himself.

“I rarely hear the names of any of our young directors abroad,” he said. “If we continue this way and only focus on what will be a domestic hit in Japan, Japanese movies will be forgotten from the world.”

Eric Margolis is a freelance writer and translator of Japanese. Find him on Twitter @EricDMargolis.