Japan Business Sentiment:

 Article Source: https://mainichi.jp/english/articles/20220208/p2g/00m/0bu/071000c

Article:

TOKYO (Kyodo) -- Business sentiment among workers with jobs sensitive to economic trends in Japan marked the steepest fall in more than a decade in January as a resurgence of coronavirus infections fueled worries, 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 for the first time in five months, down 19.6 points from December to 37.9, according to the data released by the Cabinet Office.

It is the sharpest fall since March 2011, when Japan's northeastern region was devastated by a catastrophic earthquake and tsunami.

Ideas:

Workers whose jobs are always sensitive to economic situations, trends, are always going to be on the edge, as most likely most of the jobs are service type jobs that depend on contact with people.

Its been two years, and now entering its third year, that service type workers continuing to feel the effects of the pandemic situation.

One month or one quarter they might begin to feel better and then a new variant arrives which puts them under the same stress again.

And with the coming of spring, there is/was always a sense of optimism that more and more people are going to be out and abouit which benefits the service type businesses.

So maybe its not a surpise that the economy watchers or service workers don't have a sense of optimism as they keep going through the same thing each quarter.

Article:

A reading above 50 indicates that more respondents feel conditions are improving rather than worsening. The office polled 2,050 workers from Jan. 25 to 31, of whom 1,839, or 89.7 percent, responded.

The Cabinet Office downgraded its assessment of the economy from the previous month, saying it has shown "some weakness in its recovery." In December, when the business sentiment hit its highest level in 16 years, it said the economy "is picking up, though concerns remain over the coronavirus pandemic."

In January, the index fell in all of Japan's regions, as much of the country was placed under a quasi-state of emergency following a string of record daily COVID-19 numbers driven by the rapid spread of the Omicron variant coronavirus.

Ideas:

The economy may continue to recover but an economy, any econonmy, is very complex, and as such there are going to be sectors or industries that recover faster than other sectors or industries.

And as global shlipping challenges continue along with chip shortages and energy costs continue to increase there are going to remain many challenges in the Japanese economy and the global economy overall.

As this commentary or writing is a little behind schedule, there are some serious challanges aheaf for the Japanese economy and the global ecnomy.

But at the same time, despite all of the present challenges, the Japanese economy continues to move forward but always with the idea that is just doesn't seem to be where it should be, despite the pandemic situatioin and the other challenges.

For example, consumers spending never seems to be where it should be. Maybe that might be because Japanese society, or Japanese consumers, for the most part, just don't spend like the US consumers, which before the pandemic were like spending crazy consumers.

Article:

"The tourism industry was starting to revive, but it is being hit again amid the spread of Omicron. Cancellations have also begun to take place," a travel agency employee in the Kanto region is quoted as saying.

Under the emergency, restaurants and bars have been requested to shorten their business hours, with authorities asking people to minimize nonessential outings.

Looking ahead, the diffusion index gauging business sentiment in the coming months fell 7.8 points for the third straight month of decline to 42.5, according to the data.

Ideas:

The travel industry, as a service industry is going to take the longest to recover among all of the service type businesses and of course the hotel side of the services sector.

But we need to differentiate some, as the domestic tourism industry most likekly is going to recover more quicker and with spring coming on and the anticipation of the hanmi viewing period and the golden week period, domestic tourism will most likely get back to some kind of new normal in the future.

And if the Japanease government starts the "Go To Travel" program again soon, that might help the domestic tourism industry even more.

But there were many hotels and other places that focused on the international tourism customers and unfortunately that doesn't look to be coming back any times soon.

And yes, the Japanease government has increased the number of people who can enter the country from 3,000 to 5,000 and now even 10,000 for example business people to come to Japan to do business for a few days or even a week, but that is not going to help the international tourism industry just yet.

Its a step in the right direction, but for the Japanese economy to get back to the pre-pandemic level, international tourism needs to be fully open.

But the main challenge with that is China and when its going to let Chinese tourists out of the country and travel to Japan again, and the bulk of international tourists to Japan were Chinese tourists before the pandemic.

Have a nice day and be safe!