Japan Business Sentiment:

 https://mainichi.jp/english/articles/20210112/p2g/00m/0bu/092000c

Article:

TOKYO (Kyodo) -- Business sentiment among workers with jobs sensitive to economic trends in Japan posted the largest drop in nine months in December, as a resurgence in novel coronavirus infections hit consumption during the year-end holiday season, government data showed Tuesday.

The diffusion index of confidence in current conditions compared with three months earlier among "economy watchers" such as taxi drivers and restaurant staff fell 10.1 points from November to 35.5, down for the second straight month following an 8.9 point drop in the previous month, according to the Cabinet Office.

The latest monthly decline was the sharpest since a 13.2 percent fall was logged in March last year when the virus began to spread rapidly, clouding the economic outlook.

Ideas:

Economy watchers, those who are mostly in service related type jobs feel the direct affect of the virus and also any government suggested lockdown as customers/consumers are reluctant to resume normal economic activities during the pandemic,

So its no surprise that those with service and customer service type jobs are not feeling too good right now.

Three months ago, the virus situation might seen some signs of improvement but since then the situation has not improved and also gotten somewhat worse.

People are looking for rays of hope, so maybe three months ago, they were trying to find any sign to be positive.

Article:

A reading above 50 indicates that more respondents reported improving conditions than worsening ones.

"Amid the virus spread, people refrained from holding year-end parties and were asked (by the government) to spend the holiday season 'quietly,' which we believe affected the sentiment in the service industry," a government official told reporters.

The official said business sentiment also worsened after the government decided to suspend its "Go To Travel" subsidy program from Dec. 28 in an effort to prevent the spread of the virus during the New Year holidays. The campaign was launched last July to boost the virus-hit domestic tourism sector.

Ideas:

The holiday season is most likely a period where many businesses, for the year, move into the red, or become more profitable compared to the rest of the year.

Not just service type businesses like hotels and restaurants but also retail and department stores.

A good example of course is what is called "Black Friday" in the US.  The term "Black Friday" indicates the last weekend in November where department stores and such have big sales and it revenue from the sales moves the stores from the red to the black, meaning from  in the negative to the positive in terms of profits.

But now days, of course, is online shopping that might help some businesses but not all.

So the same idea in Japan. The holiday season for restaurants, hotels, and restaurants in Japan is/was a very profitable season compared to the rest of the year.

But of course now because of the virus situation customers/consumers are scaling back their outside activities.

Article:

The Cabinet Office downgraded its assessment for the second month in a row, saying, "Weakness has been seen in the economy recently." In November, it said the economy has shown some weakness in its recovery as the impact of the pandemic remains severe.

The diffusion index gauging business sentiment for the coming months edged up 0.6 point to 37.1, following a decrease of 12.6 points in November.

Record daily numbers of new cases prompted Prime Minister Yoshihide Suga on Thursday to declare a second state of emergency covering the Tokyo metropolitan area effective the following day to Feb. 7, increasing economic uncertainty.

Ideas:

An economy is a very complex organism, an as such there are always some positives and some negatives. 

But of course the pandemic as cause more negatives than positives. There might actually be some industries/sectors or even some businesses that are actually either still doing well and or because of the pandemic are doing better.

But this is not the time to celebrate those that are doing better because of the pandemic but to try and understand there are a lot of businesses and workers not doing so good now.

That doesn't mean all 120+ million citizens and workers are not doing good but there is a sizeable number that are, and as such, the government should always find ways, whatever possible to help those in need.

Ad 37.1 index reading clearly shows there is a large portion of workers that are not too happy about their future.

Article:

The previous state of emergency was declared in early April, when the economy watchers index plunged to 7.9, the lowest reading since comparable data became available in January 2002. It dealt a heavy blow to the Japanese economy until it was fully lifted in late May.

In the reporting month, an upscale-restaurant worker in the Tokai central Japan region was quoted as saying that demand for year-end parties "disappeared" due to a resurgence of virus infections since late November, and people became less willing to dine out with others.

The Cabinet Office polled 2,050 workers from Dec. 25 to 31, of whom 1,794, or 87.5 percent, responded.

Ideas:

Whether the index is 7.9 or 37.1 again clearly shows how unhappy workers in the customer service and services industries feel about the economy and their future.

If at all possible the government needs to provide monthly subsidies to workers in these vulnerable industries. 

And the subsidies need to be big enough that it will have an affect on the largest number of workers as possible so that enough of them feel good about their future and might even begin to not only save some of the subsidy but actually use spend some of it.

The subsidies should last at least three months past the end of the pandemic, and that might actually begin to get the economy somewhat back to pre-pandemic levels.

But it there are no monthly subsidies the service and customer service type workers may feel they have not future, but with the monthly subsidies they might have more confidence that they can survive the pandemic.

Have a nice day and be safe!