Bank of Japan and Rate increases: Updated Nov. 8, 2024.

BOJ signals more rate hikes as it sees receded overseas risks

Article Source: https://mainichi.jp/english/articles/20241031/p2g/00m/0bu/048000c

Ideas:

Most central banks including the Bank of Japan don't make quick or off the cuff decisions and they don't do any decisions without checking what going in their home country and what's going on globally.

The Bank of Japan most likely, decided to keep the rate at 0.25 and not increase it because of the Japan general election and of course because of the US election, which could bring some turmoil to the financial markets.

At the same time, the US economy is doing fairly well and its inflation is going down, despite all of the negatives from some in the US, which means the US economy is not a risk to Japan at this time.

Yes, the global economy is improving little by little but of course there are still pockets of less than good such as in China and even in Germany at this time.

Further rate hikes by the Bank of Japan will depend on the financial markets if they continue to remain stable instead of going somewhat volatile back in July and of course if inflation in Japan remains somewhat stable too.

But the main cause or situation seems to be the Japanese Diet and who is going to control the Diet in the future, and how will it affect the overall Japanese economy. 

Ueda, who last month underscored the bank had "more time" to assess if another rate increase was necessary, told the news conference that he will no longer use that expression, adding the BOJ will raise rates further if the Japanese economy and prices move in line with its expectations.

Following his remarks, the yen strengthened by about 1 yen to the 151 range against the U.S. dollar.

Central banks have to be very careful about what they say, as the financial markets hang on every word that is spoken by the central bank. One misstep can cause the financial markets to move up or down depending on what they like or don't like.

The Bank of Japan has been trying for many years, maybe up to seven or more years ,to get inflation to fall in line with its 2.0 percent target, but so far it's hasn't done it yet.

Over time, maybe soon the Bank of Japan just might give up and or just want to get close the the 2.0 percent target and then begin to increase the rate gradually over time.

Despite the US economy and the global economy being somewhat stable at this time, the Japanese economy is not in the same ball-park, meaning its still somewhat unstable related the financial markets, and the uncertainty of wage talks which are crucial for the Japanese economy getting out of its current stagnant phase.

Even if the wage talks are positive and Japanese workers do, again get increased wage hikes, it must be remembered that up to 70 percent of Japanese workers don't work for the large Japanese companies that get the best wage increases, and the small and mid-size company workers don't get the same wage increases which could affect the Japanese economy, with decreased consumer spending as Japanese consumers are worried about prices and inflation.

It seems the Bank of Japan really doesn't have much control over the depreciation of the Japanese yen, as they are trying not to look like a possible currency manipulator to help the Japanese economy.

The interest rate differential between the US and Japan has been a process that started long before the pandemic as the US Federal Reserve, when inflation hit the US the Fed took quick action and increased its key rate many times over the next few years, while the Bank of Japan maintained its low rate policy which caused a huge differential to this day between the Bank of Japan rate and the US Fed rate.

So the reason, unfortunately for the high inflation rate in Japan, as Japan is a resource-poor country meaning it has to import much of what it needs and causes import prices to be higher than normal.

Reading between the lines, here, it might mean, Japan is going to be very conservative and do what it wants and not follow what the US does, like the past years, for example when the US Fed increased rates the BOJ didn't do anything or follow that the US did.

The Bank of Japan is not going to telegraph when it will increase the rate again, as that could spook the financial markets. and the BOJ doesn't want to do anything that can cause another volatile situation like last July.

All of these projections or estimates by the Bank of Japan are good and needed, but they are just estimates and anything could happen in the future and sometimes estimates are way off the mark, despite good intentions.

For example the oil markets, while staple now could again turn volatile, which means prices could skyrocket, and as Japan is resource poor it has to to import much of what it needs.

And also the the inflation in Japan has dipped down to 1.9 percent it could easily increase above the 2.0 level as again import prices, global prices, could increase again, which means the domestic Japanese economy could take another hit.

Right now, the Japanese economy doesn't needs higher borrowing costs and or to slow business activity and the economy as a whole, as needs the opposite to happen.

But it its looking to the US as an example, despite higher interests rates, the US economy has come back much stronger and at the present time, no other economy is even close to the US.

But Japan and the US are two completely different economies and what works in the US might not work in Japan and vice versa, as what the US did could hurt the Japanese economy.

The US always increases public spending even though the say otherwise, as they always talked about balancing the budget but of course they never do.

There is a a lot of unknowns now in the US and what is going to happen to the US economy. Will it continue to grow or will it decrease some overtime, which could affect the Japanese economy and what the Bank of Japan does in the future.

There is always the possibility of higher inflation and also the possibility that the US Fed. will again increase the rate which means, if the BOJ doesn't match what the US does, the rate differential could get even larger than before which then means the Japanese yen could weaken even more in the future.

The Japanese economy seems to be stuck in the 1.0/1.1 range as its been like that it seems forever, and it doesn't look like its going to improve anytime soon.

At the same time, the Japanese economy is a very stable economy as it doesn't expand that much and doesn't decrease that much too. Its not like Argentina or Venezuela  or other countries that are extremely volatile going up and down a lot.

Have a nice day!

Japan Jobless Rate Decreases: Updated Nov. 6, 2024.

Japan jobless rate falls to 2.4% in Sept. as fewer workers dismissed

 Article Source: https://mainichi.jp/english/articles/20241029/p2g/00m/0bu/007000c

Ideas:

In terms of the margin of error 2.4 and 2.5 really don't mean that much but still a decrease in unemployment is always a good sign, unless there was an increase of those who gave up looking for jobs.

Fewer workers being dismissed was another good sign as maybe the Japanese economy is beginning to show some signs of recovery, even if its a small recovery.

If workers are being dismissed in Japan, its a sign that many Japanese companies have adopted western style governing, and have given up keeping workers in the company for a long time, which used to be the norm in many Japanese companies.

Japan is in a so-called labor shortage and as such a tight labor market, which means there are more jobs available than workers in Japan. 

Most likely the 40,000 who left their jobs are those who found new jobs and or those who think they could easily get a job after they left their current job.

Its interesting that many women might have left their current jobs and most likely felt they could find or needed to find a new job, as inflation might have forced them to look for better jobs.

Lets hope those women changing jobs and or women not previously employed were able to find good paying jobs, and especially if they have families. 

Unfortunately, in Japan, many women work in service type jobs which aren't the highest paying jobs, but of course not all women or men are high tech talent workers.

The elderly, among those who have retired and because the labor market needs workers, they have a good chance of getting back in the labor force as a Japan is in a severe labor shortage at this time.

Not all sectors are the same and they don't grow exactly the same so its no surprise some sectors are doing better than other sectors.

And again, its not surprising that the information and communication sector saw an 8.9 percent increase, and at the same time the lifestyle and entertainment services sector, might have decreased due to inflation and high prices as demand might have significantly decreased.

As far as manufacturing is concerned, there might a decrease in demand which might have hurt the manufacturing sector, along with continued parts shortages. There might have even been a lack of interest among young people to work in the manufacturing sector as the work might be considered too hard.

As there is again as so-called labor shortage the 124 jobs to 100 job seekers might mean wages for the new jobs might be higher than normal which might be good and especially for working women in Japan who usually are relegated to low-level service type jobs that don't pay more than minimum wage.

Have a nice day!

Japan Firms and More Transparency: Updated Nov. 4, 2024.

More Japan firms seek to keep new hires by allaying assignment fears

Article Source: https://mainichi.jp/english/articles/20241027/p2g/00m/0bu/008000c

Ideas:

Today's new Japanese workers is a new breed of workers who are not going to accept just any job especially with the tight labor market giving them many more options to choose from.

Younger workers, globally too, want to know what the company has to offer and just what they are going to be doing in a company in the future.

Sometimes a company will use the excuse, such as " we can't give you the exact information just yet, until we see all of the new recruits." That excuse doesn't work anymore as younger workers are more savoy and want to know as much as possible about what they are going to do or they won't take a job with a company that is too unsure about where they will put a new worker.

Most likely, as the services sector usually pays less than high tech companies and maybe other large companies companies too, they might be having difficulty hiring talented young workers who maybe don't want to work in the services sector.

Even though the services sector has much smaller profit margins, they need to find ways to give as much information young workers to improve their chances of getting the best talent as possible in Japan.

Another option, like what Japanese convenience stores have done is hire young foreign graduates to work in their companies, as the Japanese convenience stores, as some articles have suggested now have  up to 80,000 foreign staff working for them, and most of them are foreign university students working to make ends meet.

In years past, as the economy was much better, maybe young Japanese workers were not that concerned about their future, as they knew a company would take care of them with life-time employment, but those days are long gone in Japan.

Probably, these days, and globally too, most workers are not going to stay with one company their entire adult working life, but will more around to a few companies, even in Japan.

The idea of just sitting at a company for 40 plus years probably doesn't appeal to many young Japanese workers these days, as the want to experience many different things in their lives and not just with one company.

Sompo maybe has the resources available to offer young workers around 30 different types of jobs, but maybe some companies don't have the resources, such as small and mid-size companies, meaning they might be losing out on the best talent available in Japan.

Not all companies maybe can be as transparent as Sompo, as maybe they don't know just yet, until they see how many new recruits they will have and what kind of real talent they are getting for the company.

In Japan its a buyers market, meaning Japanese workers have many options to choose from and companies need to be as transparent as possible to get the best talent as possible.

Maybe in the past, traditional Japanese companies could rely on their brand name and or reputation to get the best talent, but those days are long gone, as younger workers are looking for something different and not just a tried and true name brand company, that might not be interested in keeping up with times and or meeting the needs of young workers.

Panasonic is an example of name brand Japanese company that has figured out they need to have as much transparency as possible, having around 150 possible positions available is a good example of a large name brand companies doing what it needs to do to attract the best talent possible.

But, unfortunately, maybe some small and mid-size companies can't do what Panasonic can do and so they know they are not going to get the same talent as Panasonic can get, so they don't target the same young workers and look for other ways to get the best talent they can afford.

One option for companies in the services sector is to do what Japanese convenience stores are doing now, and that is to target foreign university students in Japan, to work for a service type company when they graduate, as articles have suggested there are up to 80,000 foreign students working for Japanese convenience stores now to help them their expenses.

As Japan has a so-called labor shortage that would do a long way to help many companies if they can hire foreign university graduates who are already living and working in Japan.

Have a nice day!

Japan GDP and Working-age Adult: Updated Nov. 5, 2024.

Japan's GDP growth surprisingly strong per working-age adult: study

Article Source: https://mainichi.jp/english/articles/20241019/p2g/00m/0bu/045000c

Ideas:

This is not surprising if you consider the working population from 30 to 65 they are more secure than the 18 to 30 age group who are still trying to get it together along with maybe having young families and family expenses to deal with.

And in Japan, many young people still don't have good jobs because of the stagnant economy and there some or many who have given up and not looking for work.

Also some or many are working on contract jobs which pay less and with no real benefits, so they don't spend as much as those in the 30 to 65 age group.

This study throws everything out the window about Japan being a robust economy, if you just consider what is looked at here. As Japan has long been considered a stagnant almost no growth economy for many years.

But this might be an example of many economies where the 18 to 30 are struggling to get good jobs and probably don't spend as much as those in the 30 to 65 age group.

At the same time, its always been known that the 30 to 65 age group does spend more than the 18 to 30 age group for obvious reasons, as they latter usually don't have good or stable jobs yet.

If the economic downturn is considered a long with the growth rate, then Japan is not doing so well at 1.39 percent while the US is at 1.65 percent. To be honest, it seemed Japan should have been much lower than 1.39 percent as many years they didn't have much growth.

But at the same time, the growth rate underscores the above ideas that the 30 to 65 age group in Japan were the more economically active participates while those in the 18 to 30 age groups were not spending that much, as expected.

All there countries mentioned, Japan, the US and Britain are advanced economies and don't grow like they used to, for example most advanced economies rarely get above 2 percent economic growth.

At the present time, in Japan, there is a significant labor shortage so many older workers are either re-entering the work force and or staying much longer than years before. And at the same time, while the US doesn't have mandatory retirement laws, Japan does, but they are thinking of revising the law due to the severe labor shortage, along with the idea that many Japanese need and want to keep working.

In years to come, if there continues to be a labor shortage, and the economy is not growing that good, more and more older Japanese will continue to work, either due to necessity and or the need to keep active.

Japan has always had a low labor productivity, as most jobs in Japan were not performance focused, meaning workers didn't lose their jobs if they didn't perform at a certain level. Japan continues to have one of the lowest work productivity levels among the advanced economies, as promotion is based on years of working instead of work performance.

However, there is a positive to the idea of low productivity and not losing their jobs, and they have more stability in their work lives and don't need to worry that much about being fired or laid-off.

Increasing the fertility rate is a given, but at the same time, Japan needs to improve the work-life experience for working women. Many Japanese women, remember how their mothers suffered while they were growing up and then there is the high cost of raising children in Japan, and many young married couples either don't want children or can't afford to have children.

Its the same situation in South Korea now, which also has the lowest birth rate among all countries for the same exact reasons, mothers suffered, high cost of raising children, and not the best situations for working women in both countries.

Have a nice day!

Japan Rice Prices Increase: Updated Oct. 31, 2024

Japan's 2024 new rice price rises to 31-year high after summer heat

Article Source: https://mainichi.jp/english/articles/20241019/p2g/00m/0bu/004000c

Ideas:

At some point governments need to implement temporary price controls on some essential everyday products such as rice, bread, milk and eggs. And then of course give temporary subsidies to producers or retailers of the products.

A price control means what is say, retailers and whomever can not increase the price more than the government mandated price that they think is needed to help citizens.

Also there should be price controls on these products if the growing season caused a significant shortage, and there should be a volume limit to be met for the price controls, and then of course give the producers a subsidy to cover their losses.

The Japanese government should due to maybe some not so good producers or other providers should monitor how much rice is actually supplied and its known, unfortunately, that producers will take advantage of a limited supply and try to price gouge the market, if not unchecked.

Rice is a major food product in Japan, and this past summer, friends of friends had significant challenges finding rice in the stores, because, as usual, there was a lot of hording before stores put a limit on how many bags buyers could buy at one time.

But of course, even then, some shoppers would go back the same day and try to buy more rice.

First off, there might have been 3 million foreign tourists in Japan in August and not all of them ate rice dishes, so it was unlikely, they alone would have caused a rice shortage.

Yes, of course, just like all businesses in Japan, production costs have increased as the weak Japanese yen might have caused production materials to be more expensive than usual.

And then there was the megaquake situation, which is normal, as some people might have gone out and tried to stock-pile needed products, including rice in August for fear of a possible earthquake.

People are going to people, meaning they have fears and worries so hording and stockpiling is a natural response to any situation sometimes.

But a government should try to help the citizens by finding ways to reduce stockpiling and hording as much as possible.

Have a nice day!

Japan Labor Union Seeks Pay Hike: Updated October 30, 2024

Japan's largest labor union to seek pay hike of at least 5% next year

Article Source: https://mainichi.jp/english/articles/20241018/p2g/00m/0bu/053000c

Ideas:

Its good that the biggest trade union want higher wages to help their workers but also to help small and mid-sized companies too get higher wages, as they are often overlooked compared to large companies.

The challenge might be that small and mid-size companies can't afford the higher wage increase as they are probably already challenged by increased labor costs and increased material costs, not to mention increased energy costs.

Small and mid-size companies might want to pay their workers more but their profit margins are just too thin to do it.

Rengo might have good intentions but they don't see or speak exactly for each small company as each small company, while wanting higher wage increases to get more talent working for them, but maybe they are unable to pass-on their costs to the next in the supply chain, as customers and other companies might not like it that much.

The problem also might be some or many of these small companies are suppliers to larger companies which have more market power and can easily or not easily due to contracts, tell a small company we don't want to pay for the increase cost you are passing on to us.

Rengo may or may not have the market power to get large companies to agree to the passing-on of the costs of smaller companies, but they should try to make sure it can be done.

For many years, many Japanese companies either gave minimal wage increases or no wage increases at all, as that was the norm in much of Japan since 2000.

The small firm increase of 4.45 percent was not bad but it wasn't good too, as inflation added up each month, probably was more than that.

Large companies of course in most sectors are the market leaders and what happens in negotiations with large companies trickles down to the mid-size and small companies and they usually get wage increases a little less than what large company workers get.

Have a nice day!

Japan Inflation: Updated October 27, 2024.

Japan inflation slows to 2.4% in Sept. as energy bill subsidy resumes

Article Source: Article: Article was deleted by mistake.

Ideas:

Inflation in Japan has been steady and its just not one month but it seems like every month, so all those months can add up for Japanese consumers and businesses.

Inflation is in itself is not a bad thing, but when it becomes excessive it can be a stress for many consumers and businesses. 

There is good inflation, the increase of prices due to increased demand and there is not so good inflation, price increases by companies that are just passing on their increased costs to the next in the supply chain, including the final customer.

Japan is resource-poor country which means Japan has to import much of what is needs, which of course means its subject to global prices increases on most products including gas and oil.

And then add in the weak yen, and imports are inflated even more for not just Japanese consumers but Japanese businesses too.

Energy and fresh food are taken out of most consumer price indexes, globally, as the two items can be very volatile, meaning prices can go up and down a lot.

Subsidies are good and needed but are they enough to cover the Japanese household energy costs in the summer and then as winter approaches, most likely global warming or global changes are going to cause record low temperatures this winter.

As there were probably a lot of new air-conditioners sold this past summer in Japan and the same situation might happen in the winter with an increase in sales in heaters this winter.

Japan, if they don't, have need trade agreements with energy producing countries to try and control the price of energy, and Japan has to import much of what it needs.

There has been a lot of discussion if there really was/is a rice shortage in Japan, as even the Japanese government has suggested there never was a rice shortage. But at the same time, there might have been a reduction in the harvest of rice and the weather might have limited the rice production, which of course, related to supply and demand, anytime there is a shortage, prices will increase.

Anytime there as reduced harvest, of any kind of fruit and vegetables, farmers and so on will increase prices as they need to make up for the limited supply with higher prices.

And of course due to production costs, now even rice farmers are passing on their costs to the next in the supply chain, which of course will affect the Japanese consumer.

The summers in Japan have gotten hot each year, which means the price of fruit and vegetables will most likely be higher.

The price of durable good might have nothing to with anything other than the increase of prices related to manufacturing of the durable products, as manufacturers, again, are passing on their increase costs to the next in the supply chain.

Hotel expenses might be related to either an increase in demand and or an increase in energy bills due to the summer heat.

The Bank of Japan is watching very carefully the increase or decrease in prices and whether they should increase the key interest rate this fall.

If prices continue to increase the BOJ might decide to increase the key rate, if prices remain steady and not increase that much the BOJ might delay the interest rate increase.

But another key ingredient is what is going to happen in the stock markets this fall, and of course what is going to happen in the US elections. If the global stock markers go crazy the BOJ might wait until things cool down.

Prices alone most likely is not going to get the Bank of Japan to increase the key rate as what is happening in the global markets, again, might have an affect on what the BOJ does.

For example, the stock market upheaval, this past summer, might have forced the Bank of Japan to  step back from a rate increase this fall.

Again, as the US election is coming up, and the chance the global markets are going to be somewhat crazy the BOJ might wait until December or even January to make its move.

Have a nice day!

Editorial : The Japanese Economy and Inflation: Updated October 29, 2024.

Editorial: Japan's parties must provide fresh economic vision for inflation-hit populace

Article Source:  Article deleted by mistake:

Ideas:

But at the same time, prices continue to remain high for many many months in Japan, as there doesn't seem to much hope for Japanese households get back back to some kind of normalcy.

Japanese households are struggling, and it seems like, of course maybe not true, but the Japanese Diet, doesn't seems to be in touch with with the average Japanese household, as most of them are probably very rich or close to it.

Wages might have have increased at a rate not seen in 33 years, but it must be remembered, that 70 percent of Japanese wage earners don't work for large Japanese companies, and the small and mid-size companies might not have gotten the same wage increase as the large company workers.

Yes, as the article suggests, its only the large company workers who got the wage increases, and as usual everyone else including up to 40% of the workforce didn't see the wage increases.

But unfortunately, that might be global, as large company workers worldwide enjoy the benefits of the market economy, while everyone else might not see the same benefits.

Non-regular workers, again, which makeup 40% of the work force because companies are cutting costs and not highering full-time full benefit workers, as even Japanese companies have gone to western style governance and trying to keep the stockholder happy, and not really thinking about its workers.

Its very unfortunate that companies try to take advantage of workers, while maybe giving them a wage increase, but then cutting their hours to keep their costs down. Its very immoral and unethical that the only thing they think about is the bottom line and not the welfare of their workers.

Of course they probably know she is not going to complain and that might cause her to lose her job or have her hours cut even more.

This situation with the family with two young children is very sad, and Japan used to be known, somewhat as a rich country, but not any more, as there might be many young families in Japan like this that are barely getting by if even that.

Most likely, maybe Japanese companies, in reducing costs and being more like western-style companies they have gone too far in cutting costs, as at one time, maybe before the asset bubble crash of 1989, companies took care of the workers and paid wages that didn't put families in despair.

Its seems obvious that the Japanese government either doesn't know what do to about the situation and or they can't care about the 40% of workers who might be non-regular workers as that is a large portion of the workforce, but because of increased expenses and low wages they are not really participating in the Japanese economy.

If 40% of the Japanese workers in the workforce are non-regular workers, again, that is a large group of workers that don't have a voice in the economy, by that meaning they don't buy like large company workers in the Japanese economy, and no wonder consumer spending in the Japanese economy is never where it should be.

All politicians, globally, always promise many things but hardly ever really follow up on their campaign pledges, 

At one time, Japan might have been headed toward being like some Northern European countries, with a large share of its population somewhat well-off, but those days seem to be long gone, as now maybe even some up and coming developing countries have surpassed Japan in terms of its population being somewhat above the poverty line and well off.

But to be fair, Japan is still a somewhat rich country, but at the same time its inequality has grown more and more since the asset bubble crash of 1989.

There might be a significant number of Japanese now living at or near the poverty line despite the image of a rich country.

Japan has an ageing population problem and yes, they need to keep the social security situation under control. There might not be any easy solutions to solve the debt problem in Japan, as yes, the sales tax, while not liked by many, might be needed as maybe Japan doesn't have any other possibilities besides the sales tax.

Unfortunately Japan has the highest debt to GDP ratio in the advanced world now, with it getting even bigger with every year.

But the only thing is the debt that Japan has is mostly owned by Japan, and mostly owned but the Bank of Japan, as Japan is not in a place like Greece was in 2010.

So Abenomics and trick-down economic growth didn't work like it should have as the small and mid-size companies didn't see the benefits of Abenomics.

Small and mid-size companies, with good intentions can't help or pay their workers wage increases like the large companies can.

Back before the asset bubble crash of 1989, most likely, many small and mid-size companies had better wages and better benefits maybe even comparable to some large companies, but again, those days are gone. as there are huge gaps, now between small/mid-size companies and large companies in Japan.

Its seems, unfortunately, Japan is spiraling down, more and more, with its income inequality getting larger by the year.

It seems Japanese politicians have no ideas really what is going on and or they really don't know how to solve the challenge that many Japanese households are facing.

It's possible, that Japanese politicians are scared of large Japanese companies as maybe they have too much power now, and don't want to force them to give good wages to the non-regulars workers, which, again, might make up 40% of the Japanese workforce.

All of the above ideas are good and very much needed in Japan as the disparities are huge and can no longer be ignored.

And yes, there will be no real healthy economic growth until the disparities are fixed, but fixing is the challenges will be difficult, as maybe the Japanese politicians don't have the strength the do what is needed for the Japanese economy and society.

Maybe many small and mid-size companies know and feel their employees are struggling but they can't do anything about it as their sales are too low and their costs are too high at this time.

And yes, if the average Japanese workers's anxieties are reduced they might begin to participate more in the Japanese economy with buying more products and even buying more from small and mid-size companies too, but its not going to happens unless the average Japanese feel good about their wages and can see and feel and decrease in their expenses.

South Korea has had the same problem for many years, as the South Korean government, over a period of 5 years or so, implemented increases in the minimum wage, and to help small companies, they gave the subsidies as a way to help them cope with the increased minimum wage.

But the subsidies didn't help that much, as they unfortunately reduced the hours or workers, or didn't hire new workers, or even laid-off workers.

Some even started using more un-manned kiosks in their businesses as a way to reduce labor costs.

Japanese politicians, again, might not have the resolve or strength to do what is needed, as sometimes there are just too many competing factors involved. They might have good intentions with good ideas, but they never are implemented.

And yes, again, most likely many small and even mid-size companies are just getting by, if even that, and they can't handle increased labor costs at this time.

Have a nice day!

Japan University Graduates and Jobs: Updated Oct. 25, 2024.

Almost 96% of 2025 university graduates in Japan receive job offers: company survey

Article Source: https://mainichi.jp/english/articles/20241016/p2a/00m/0bu/016000c

Ideas:

Its very good that Japanese students can get many offers, with upwards of 96% getting some kind of offer. It indicates, maybe there is a labor shortage in Japan and companies are looking for workers.

But to be fair, what size companies students getting offers from. Are they large name-brand Japanese companies or are they small and midsize companies too.

And has been mentioned in other articles recently, some students who got offers soon quit as they couldn't adapt to the company work environment.

How many of these graduates are going to be with the same company after 5 years, or after 10 years and so on, as changing jobs has become more common in Japan as company workers don't want to be with the same company their entire working life.

In South Korea, for example, many university graduates don't want to work for a small and mid-size company as the salary and benefits are very much different, so many graduates, instead of taking a job at a small company, they might take up to year or more and continue to look for that big company job, such as Samsung.

It is estimated that there are more than 500,000 graduates in South Korea, just looking for jobs even though they have graduated.

It has also been suggested that some Japanese companies, not all companies, put a lot of pressure on graduates after giving them an offer not to change their minds.

The Japanese government has tried to crack-down on such companies but without much success, as it continue to happen.

So some graduates are using a kind of employment agency that helps them tell the company that have changed their minds and or those already working for a company to help them quit without a lot o pressure from the company to stay and continue working.

Today's graduates are very different from the graduates of 20 years ago, as they are more picky and don't want to work like their fathers did with long hours and maybe even weekend work.

Many graduates are looking for better work-life experiences and not looking for traditional rigid Japanese work culture, like their fathers had to endure.

The more a company can show the real example of what it will be like working in that company, the better chance graduates might consider that company. They are looking for transparency into what a company can do for them with good work-life experiences.

Have a nice day!

Japan Trade Deficit: Updated Oct. 23, 2024.

Japan trade deficit in fiscal 2024 1st half widens 14.4% on weak yen.

Article Source was deleted by mistake.

Ideas:

Until the yen become stronger most likely Japan is going to have a trade deficit as its a resource poor county, and has to import much of what it needs and as a result the weak Japanese yen will continue to increase import prices.

Japan is strong export focused country but for now the exports are not able to overcome the trade deficit even though there have been record exports.

Export volume might have been larger than import volume, but again the weak yen throws everything out of whack related to international trade and the Japanese current account.

Computers from the US. might not have actually come from the US but a US product made in China such as the Apple Mac Book, which might be manufactured in China, as for computers Apple is the most popular in Japan as is the I phone.

Japan, it seems, has gotten back into the semiconductor equipment and chip making business after losing market share to TSMC in Taiwan and Samsung in South Korea.

And yes semiconductor chips as again become a key export product for the Japanese economy and should continue to see solid growth in the future.

You can never count out the US, as its still the strongest economy in the world at this time and there seems to really not be any other economies that can match the US. There might be some bumps here or there but there should not be anything significant in the future.

China is a very different situation as maybe its going through a situation similar to what Japan did after it grew a lot in the 1980'as. China seems to have grown fast, maybe too fast, but maybe it has leveled off and its having some real challenges as this time.

Japan seems to be stuck in some kind of stagnation as it economy just to be very stable but at the same time never really grows that much as it might reach 1 percent or not even that most years.

As the data shows trade with the US is still robust and most likely will continue to be strong despite some who say the US is headed for a slow-down in the future. 

And has shown in the data trade with China is still on-going but of course not at the level that it was before the pandemic.

Japanese companies just need to stay the course and continue to ship to China maybe someday the largest or second largest economy will find it footing again and get back to normal or some kind of new normal for China.

The Asia-Pacific region is a large area with a  huge population so trade with countries in the Pacific area should continue to be strong as the data suggests.

However something is going on with the European Union and maybe its not just the Ukraine war as trade with the EU just isn't what it used to be.

The growth of imports of course can be attributed to the weak Japanese yen, as maybe the volume was not that much as maybe in line with the export volume from the EU.

The Bank of Japan has to decide what is best for the Japanese economy. Is it the domestic economy or is it the export focused part of the Japanese economy. The Bank of Japan seems to not be able to balance out the concerns of both groups at this time.

But to be fair, its seems the BOJ is unable, yet trying to rein in the weak Japanese yen. But again, to be fair, the BOJ doesn't want to be seen by the US as a currency manipulator, so whatever it does its keep behind closed doors and it never really talked about.

So importers feel the weak yen, and so do retail customers in Japan, while export companies feel the weak Japanese yen too but with increase profits from overseas.

The Japanese yen seems to be on a roller coaster ride, as of late, which makes companies both import companies and exports companies very uncomfortable as they sometimes don't know how to plan or manage the Japanese yen situation.

Its especially hard of small and mid-size companies who don't have the resources needed to protect themselves from the weak yen or even the volatility of the Japanese yen.

And again to be fair, the Bank of Japan doesn't want to intervene in the Japanese economy too much as too much intervention might upset the normal market mechanisms. Sometimes too much intervention is worse than no intervention.

Have a nice day!