I was aware of the big problem in Japan before seeing my own children battling through it. It hinders language students from the beginning. It remains, wrongly, the criteria that companies use to gauge success.
Japan's education system is anchored around a focus on tests. Every course, every textbook is centered around the students taking and passing exams. It is very common that the children will go to cram schools called juku, where they essentially are trained the ins and outs of how to pass the tests to get to the next tier of education. And this stands in the way of their ability to actually speak the language that they speak, because schools don't set a curriculum based on activating the language they use.
This continues on to the adult level. TOEIC, the Test of English for International Communication is the standard that companies and some institutions measure people's ability to communicate. Which means that company workers are bound by a similar constraint of a system focused on the wrong thing, the ability to actually speak. I have taught students with strong TOEIC scores in the 700's (990 is best) but are unable to string together a few sentences. Similarly I have taught students in the 400's who manage to communicate consistently. It is just not the right focus.
English training, or any language for that matter, needs to be centered around a focus on actually speaking and relaying information. Classrooms need to be loud with students using the target language in structured, productive, activities. And it needs to be the students' voice you hear the most, not the teachers'. Activating and getting practical experience can help push Japan towards a stronger average level of proficiency. Japan is ranked at #87 in the world in the global English proficiency rating (LINK), which is labeled as 'Low Proficiency'. It would help to see this over-reliance on tests change from the Elementary level, but as trainers of Adult Speakers we can make a difference by giving our students every chance to speak, but ensuring that the lessons are productive and there is always a takeaway.
I should qualify that tests are not all bad. They do provide a motivation to study and some people really grow their vocabulary trying to do well in their tests. Also companies do need some way to measure people's progress, especially if they are spending money on English training programs. But the current test systems are insufficient and there needs to be a way to measure people based on their ability to communicate. I don't have the easy answer to this, but my eyes are open to how we can achieve this. Either way, for now, I am focused on improving the opportunity to speak while ensuring the students have multiple takeaways from each class.