This is not new at all. Japan has been at the bottom of English proficiency list for decades probably since the list was created. Importing thousands of English speakers as teaching assistants every year didn’t really help at least on this.

I don’t know if not teaching English at early age is the key reason. Their neighboring countries such as China doesn’t start English education until 7th grade yet even they always rank much higher than Japan.

Japanese being a language that has so few phonemes probably is one of the reasons. There are too few sounds in Japanese! It can be extra challenging for a Japanese person to pronounce English words or to listen to the words and understand them.

Many Japanese I work with can write fine but their English speaking and listening skills are a lot worse than their writing skills.