Japan Household Spending:

 https://mainichi.jp/english/articles/20210511/p2g/00m/0bu/077000c

Article:

TOKYO (Kyodo) -- Japan's household spending in fiscal 2020 fell a real 4.9 percent from a year earlier, posting the second-sharpest drop on record as the coronavirus pandemic forced many people to refrain from eating out and taking trips, government data showed Tuesday.

For March alone, meanwhile, average spending by households with two or more people rose a real 6.2 percent from a year earlier, the third-largest monthly increase since comparable data became available in January 2001, according to the Ministry of Internal Affairs and Communications.

Spending by households with two or more people averaged 276,167 yen ($2,500) per month in the fiscal year through March, decreasing for the second straight year.

Ideas:

It was not a surprise that Japan household spending, or consumer spending, decreased in fiscal 2020.

4.9 percent doesn't really seem like that much but when you look at the total household spending 4.9 percent becomes a lot.

And it was not a surprise that spending increased in March, as the emergency measures were reduced meaning more consumers were out and about.

Of course it being spring might have had something to do with an increase in spending as people were out and about to see the new cherry blossoms and to enjoy the warmer weather.

Article:

The 4.9 percent drop followed a 5.1 percent decline marked in fiscal 2014 when personal consumption was battered by a consumption tax hike from 5 percent to 8 percent in April.

The latest data reflect the adverse impact of the virus that began to spread in the country in spring last year, prompting the government to declare a state of emergency twice in the reporting year and request people to stay home and restaurants to shorten business hours.

The pandemic triggered the worst contraction on record for the world's third-largest economy in the April-June period in 2020 when the first state of emergency was declared and nonessential businesses were asked to suspend operations.

Ideas:

Its understandable that the Japanese government requested people to stay home.

But how many people started to buy online instead of going to physical places to spend.

And how many business, if they didn't have a presence already, started to sell their products and or those essential to customers online.

For example, did supermarket begin to sell online and then have different kinds of delivery methods like has been reported.

Such as instead of going into the supermarket, some supermarkets bring the purchased products outside to waiting cars.

And or how many supermarkets started delivery services using motor scooters and or delivery service companies to provide more safety to customers.

How many restaurants, besides the fast food places, started delivery services if they could afford it, either using a food delivery service company, or delivered the food themselves within a certain geographic area.

Article:

Household spending sank a real 16.2 percent in May from a year earlier to log the steepest monthly drop on record, following an 11.1 percent dive in April.

"The coronavirus pandemic largely affected expenditures throughout the year, as people spent less on such activities as eating out and buying clothes due to stay-at-home requests," a ministry official told reporters.

By category, outlays for dining and drinking at restaurants and bars plunged 29.8 percent from fiscal 2019, and those for clothing and shoes were down 19.7 percent. Spending on transportation plummeted 51.2 percent, while that on entertainment services including trips fell 30.6 percent.

Ideas:

For every negative in the market place, there are always some positives or some positives are created.

For example, again how many consumers started to buy or shop online.

How much did Amazon Japan increase in sales during this time.

Did any Japanese department stores or other retail type places use or begin to use the Amazon method of having customers pick up purchased products at convenience stores.

Or maybe some retail place had already been doing it, and it not really an Amazon Japan idea.

But of course besides safety, there might have been many consumers who worried about their jobs, or income, or future, which would also have decreased spending.

Article:

On the other hand, so-called nest-dweller consumption grew, with expenditures on goods for entertainment use such as laptops and television sets rising 11.7 percent and utility bill payments up 4.6 percent.

Spending on meat and fish also rose 10.0 percent and 6.5 percent, respectively, as people bought more foodstuffs to cook at home.

The average monthly income of salaried households with at least two people in fiscal 2020 grew a real 3.5 percent to 607,586 yen, up for the third consecutive year.

Ideas:

Again there are positives and negatives in any situation. As consumers decreased spending on some things they began to buy other things or alternative products.

Of as demand for these so-called nest-dweller products increased it would not be surprising if the prices on these types of product also increased

One only need to go Amazon Japan and maybe can see the increase in the prices of laptops as demand for these products increased throughout the year.

And did the prices of meat and fish increase too, as demand for these products increased.

And again, did the supermarkets provide an safe delivery type service either by delivery, bring the products to waiting cars or customers outside, as has been reported before.

It interesting that salaries increased during the pandemic as many companies maybe were not doing too good.

Article:

The income data reflected the impact of the government's 100,000 yen cash handout program to all of Japan's 126 million residents to mitigate the economic fallout from the pandemic.

As for March this year, average household spending stood at 309,800 yen, up for the first time in four months, as the government's second state of emergency over the pandemic was fully lifted late in the month. A 6.0 percent drop in March last year also helped boost the figure.

The second virus emergency issued in early January had suppressed household spending, which decreased by 6.1 percent in January and 6.6 percent in February.

Household spending is a key indicator of private consumption, which accounts for more than half of Japan's gross domestic product.

Ideas:

And yes the handout might have reflected in the increase salaries if it was included, which maybe it shouldn't have in order to see the real salaries throughout the year.

Household spending or consumer spending has always been a target of the Bank of Japan.

As Japan become more of an ageing society, those in the 65+ age groups tend to spend less.

And as those groups become more and more of the population, it could show a real decrease in consumer spending in the economy overall.

One of the reasons that the Bank of Japan's target or goal of reaching 2 percent inflation has been the affect of the aged population.

But at the same time, its quite possible, brainstorming, that a 2 percent inflation goal, just might not be the correct target for the Japanese economy.

As Japan is a relatively rich society, then yes, there is potential to reach the 2 percent target, but the it appears, overall, that Japan is still a society that tends to spend less that the relatively rich western countries.

Have a nice day and be safe!