Japan's booming animation industry is in crisis -- with low pay, long hours and a huge shortage of artists -- just as its global popularity has never been higher.

Three of the 10 feature films in the running for top prize at the world's most important animation festival in Annecy in France -- which ended Saturday -- are from Japan.

The country is the only real challenger to Hollywood's dominance of the labor-intensive genre.

But just as Japanese anime seemed to be threatening to loosen Pixar and Disney's grip on the popular imagination with the likes of the teen mega hit "your name." and a Nintendo Super Mario movie in the pipeline, long-running structural problems are in danger of sapping its rise.

With talk of a talent shortage, its greatest star, the legendary Studio Ghibli founder Hayao Miyazaki, has come out of retirement at 78 to make "How Do You Live?" -- which may be released next year -- with speculation that he could take on another feature if his health holds.

Miyazaki blazed an arthouse trail with such animated classics as the Oscar-winning "Spirited Away", "Howl's Moving Castle" and the fabulous "My Neighbor Totoro".

But Yoshiaki Nishimura, a former Miyazaki stalwart who produced the Oscar-nominated "The Tale of The Princess Kaguya", told AFP that the industry was struggling to "face up to a lack of animators, bad working conditions and perhaps a lack of creativity".

His peers also complain of low pay, a paucity of emerging young talent and burn-out in overworked animation teams who often put in 12- to 18-hour days.

Rising star Keiichi Hara, who showed his new film "The Wonderland" at Annecy after winning the jury prize there four years ago with "Miss Hokusai", feared for the future.

"Perhaps the biggest problem in the Japanese animation industry is that there are no more young animators," he warned.

Ayumu Watanabe -- whose beautiful "The Children of the Sea" was shown out of competition at the festival -- worried about visual "standardization" and lack of originality, not helped by the fact that "fewer and fewer animators can draw well by hand."

Even industry heavyweights like Mamoru Hosoda, the genius behind "Wolf Children", "The Boy and the Beast" and "The Girl who Leapt Through Time", have to put in punishingly long hours with relatively tiny teams.

He told AFP last year that his latest hit "Mirai" was inspired by his wife complaining that she was a widow to his work, calling him to account for leaving her "to bring up my son on her own".

Watanabe said that the industry has split into two extremes: "Big productions who can call on an incredible number of animators and at the other end of the scale, and more artistic projects that have a lot less money."

All eyes later this year will be on the release of "Weathering with You", Makoto Shinkai's fantasy follow-up to the record-breaking "your name.", now the highest-grossing Japanese film of all time.

Its production team unveiled a sneak preview of the supernatural story at Annecy, with a high-school runaway meeting a girl who can change the weather.

With a live-action version of "your name." in the works and U.S. television about to remake the cult Japanese series "Train Man" about an anime-obsessed youth, the genre has never been closer to the international mainstream.

Nishimura said that he has tried to keep the "Ghibli style and spirit going... with a mix of hand-drawn and computer animation" at Studio Ponoc, which he set up after Miyazaki -- a heavy smoker who was having health problems -- first hung up his pencil in 2013.

It scored its first hit in 2017 with "Mary and the Witch's Flower" and Nishimura premiered a series of new shorts at Annecy.

For him, the industry's woes are "the result of an accumulation of problems over the last five to 10 years", but he insisted his studio was trying to "create a new environment".

And as the wowed audiences at Annecy for Masaaki Yuasa's touching "Ride Your Wave" proved, despite its problems Japanese anime can still get things very right.

The story of love, surfing and grief struck a huge cord with critics at the French festival.

Amel Lacombe, whose company Eurozoom is a key French animation distributor, said the industry's travails are due to its rapid growth, and now "we are in a period of adjustment".

She believes that the Japanese authorities are waking up to anime's importance and global reach "as a export force". </s> An arson attack on an anime studio in Japan has left at least 33 people dead and dozens injured in Japan’s worst mass murder in nearly two decades.

The perpetrator, who was also injured and has been taken into police custody, walked into the 1st Studio building of Kyoto Animation in Fushimi ward, Kyoto, at about 10.30am. He poured what is suspected to be petrol in multiple areas of the building before igniting it.

The prime minister, Shinzo Abe, called the attack “too appalling for words” and offered condolences.

There were more than 70 people in the building, which is Kyoto Animation’s main studio.

About 30 fire engines and ambulances went to the three-storey building after an explosion. Victims were taken to various hospitals in Kyoto.

The suspect, identified only as a 41-year-old male, was reportedly taken to hospital before being arrested by police, who said he had admitted starting the fire.

No motive for the arson attack has been reported, but Japan’s public broadcaster said he had shouted “drop dead” as he set the petrol alight.

Preliminary investigations by the police have uncovered no links between the subject, who has yet to be named, and the animation studio.

Facebook Twitter Pinterest Firefighters at the Kyoto Animation building. Photograph: Kyodo/Reuters

“A man threw liquid and set fire to it,” said a Kyoto prefectural police spokesman.

Emergency calls to the city fire department reported there had been an explosion on the ground floor, while later calls included people shouting: “Help us, the fire is climbing.”

Images shot from a helicopter for NHK showed smoke billowing from the top floor and fire crews still battling the blaze of the badly damaged building hours after it had started. Fire crews said there might be more people left in the building.

The fire department said the three floors of the building covered a total of 700 sq metres and that every storey had been damaged by the fire.

Professor Yuji Hasemi, an expert in fire safety and materials at Tokyo’s Waseda University, told NHK that a combination of poor ventilation, an abundance of paper used by artists and the large amount of petrol likely caused the fire to spread too quickly for people to escape. No fire escape stairs were visible in images of the building.

Violent crime is rare in Japan, though it is not unknown. In July 2016, a mass stabbing at a care home by a former employee killed 16 and injured more. In September 2001, a fire at a building in the Kabukicho entertainment district of central Tokyo killed 44. Arson was suspected, but nobody was ever charged, meaning the Kyoto Animation attack is the worst confirmed mass murder in Japan’s post-war history.

Akidearest (@akidearest) I’m heartbroken seeing what happened to Kyoto Animation. I don’t know what that sick person must have had against that studio to set it on fire, but my condolences to all the hard working employees. I wish you all a safe recovery...

Kyoto Animation

Kyoto Animation, known as KyoAni, was founded in 1981 by Yoko Hatta, an anime producer. Her husband, Hideaki, serves as the company’s president. KyoAni has produced popular anime TV series and feature films, as well as publishing illustrated novels and manga. It is well known among anime aficionados around the world for its dedication to high-quality production techniques, with a catalogue that includes A Silent Voice: The Movie, K-On!, The Melancholy of Haruhi Suzumiya and Lucky Star. Its company headquarters are in Uji city.

Kyoto Animation has a reputation for treating its employees well in an industry infamous for harsh working conditions, long hours and, for junior animators, very low pay. The growth of the genre’s popularity worldwide and increased demand for content from streaming platforms such as Netflix has put even more pressure on the studios at a time when Japan is experiencing a severe labour shortage. Most studios are booked out with projects up to two years ahead.

Many anime artists are paid on a per-frame basis and tight deadlines make the work gruelling and long hours inevitable. Kyoto Animation bucks the trend by making its animators full-time employees. This allows them to spend more time on each image and create high-quality anime.

One of its best-known franchises is K-On!, a comedy about a band formed by high-school girls. It started life as a manga comic book, before Kyoto Animation created two TV anime series that aired between 2009 and 2010. It was also broadcast overseas and released on DVD in the UK. Kyoto also produced a film directed by Naoko Yamada – which followed the girls’ graduation trip to London – that was released at the end of 2011 and grossed ¥1.64bn (£12.2m) in Japan. The film featured a cafe based on the Troubadour in Earl’s Court, south-west London, which has become a popular destination for fans.

A Silent Voice, also by Yamada, which dealt with childhood suicide, was hailed by critics and fans when it was released in 2016. Although overshadowed at the time by Your Name, whose director Makoto Shinkai lavished praise on it, it still took £29.4m ($33m) globally.

• This article was amended on 23 July 2019 to correct the location of the fire. It was at the company’s studio in Kyoto’s Fushimi ward, not at the headquarters in Uji as an earlier version said. A misspelling of Fushimi ward has also been corrected.
Japanese anime developers report that the industry is in crisis, even as its popularity soars in its native country. Among the reasons are low pay, long hours, and a huge shortage of artists – just as its global popularity reaches record levels.