Japan Household Spending: Updated on Oct. 4, 2003.

 Article Source: https://mainichi.jp/english/articles/20230606/p2g/00m/0bu/009000c

Article:

TOKYO (Kyodo) -- Japan's household spending in April fell 4.4 percent from a year earlier, declining for the second consecutive month and marking the largest drop after a 6.5 percent fall in February 2021, as more people cut back on spending on education and food amid rising prices, government data showed Tuesday.

Wages fell an inflation-adjusted 3.0 percent in April, marking the 13th consecutive month of decline, as pay hikes have still not caught up with the pace of rises in commodity and energy prices amid Russia's war in Ukraine, a separate data by the labor ministry showed.

Ideas:

It's no surprise that Japan household spending or consumer spending decreased 4.4 percent beause of inflation. 

Households or consumers are probably going to cut back even more unless wages and finally surpass the inflation rate.

But as some reports suggest wages might have increased an average of 3.6 percent but it that really enough to cover the months of inflation and prices increases. 

And even if wages do increase more than inflation it have a lag effect meaning its going to take time households or consumers to meet the daily and monthly needs and then finally begin use what they have leftover in the ecoomy meaning spending.

Article:

Households of two or more people spent an average of 303,076 yen ($2,170), the Ministry of Internal Affairs and Communications said. On a seasonally adjusted basis, spending slid a real 1.3 percent from March.

By category, spending on education, including supplementary education, plummeted 19.5 percent from a year earlier, while food expenditure fell 1.1 percent, including an 8.7 percent plunge in purchases of seafood, according to the internal affairs ministry.

Ideas:

If 303, 076 yen was the average for a two person household what was the variance compared to a one person husehold and or what was the variance for the upper-income group and the lower income groups.

In comparing South Korea and Japan, supplementary spending on education actually increased as pareent in South Korea see it has a need to keep up with the rest of society.

A decrease in food was no surprise but it would be unfortunate if the lower income groups had to but back on food and or fixed income groups had to cut back because of inflation or higher prices.

The decrease in seafood might have been attributed the Fukushima situation and or lower harvest or catches related to seafood and or wholesalers increasing the prices for any numbe of reasons.

Article:

"The decrease is mainly due to the impact of inflation," a ministry official said.

However, there has been an increase in spending on travel and dining out after the government eased the country's COVID-19 restrictions, the official said.

Ideas:

Possibly seafood prices might have reached the level that consumer felt was just too ight for what they wanted to buy and they cut back and started to buy other food products instead.

While more consumers started to travel more and or spent more on dining out maybe there was less shopping or buying in supermarkets which might have included less buying of seafood and other food products.

But also restaurant prices might have increased but maybe consumers are still happy to be out and about and not too concerned with restaurant prices at this time.

Article:

Recreation and leisure expenditure rose 4.6 percent, according to the data.

On a nominal basis, household spending decreased 0.5 percent.

The spending data is a key indicator of private consumption, which accounts for more than half of the country's gross domestic product.

Ideas:

Recreation and leisure spending might have increased 4.6 percent and of course that is likely as people are finally happy to be out and about and not stuck at home. 

But at the same time, inflation had an effect, nominally, on spending with decrease of 0.5 percent overall, but that much of drop.

Private consumption or consumer spending is a large part of any advanced economy, including Japan but for Japan its probably not enough at maybe only 50 percent of GDP, as Japan is seen more of saviogs economy and not so much of a spending economy like the US.

But if the wage increases have any effect at all and if they are large enough it could and should increase consumer spending and consumer demand in the Japanese economy.

Upated on Oct. 4, 2003.

Have a nice day and be safe.