Is there still a demand for ESL/TEFL teachers in Japan? Or has that market been flooded by Americans teachers seeking work? What does it pay?

Yes, there is definitely still a demand for ESL teachers in Japan. However, there are more and more teachers going to Japan, so don't expect special treatment. The pay is enough to live off of, and maybe save a little. If you teach at a language school, you will probably work a lot of hours a week.

There is still demand for native English speakers, but less than there used to be. You may hear stories about the "good ol' days" of EFL teaching in Japan when they'd take just about anyone, but this is no longer the case.

As an American, you'll need to have a 4-year college degree (any major) in order to qualify for a Japanese work visa. But first you need a job offer. EFL certification is usually not required (I taught in Japan without one), but it would give you a big advantage over other candidates.

A beginning EFL teacher could expect an annual salary worth between US $20,000 and $24,000, depending on the current yen to dollar exchange rate.

You may want to look into the Korean market as well. I hear that there is higher demand there now, and it's possible to make just as much money as in Japan.

Most ESL teachers in Japan are Aussies. Before coming here without a job lined up, check out http://www.letsjapan.org and http://www.gaijinpot.com for info about what you would be getting yourself into. If I were you, I would check out AEON, GEOS, and ECC . These companies will set up a visa and accommodation for you.

Read the full story here: Teachers left jobless as Japan language school goes bankrupt