Japan's Household Spending: Updated January 11, 2025.

 

Japan's household spending falls 0.4% in Nov., down 4th month in row

Article Source:   https://mainichi.jp/english/articles/20250110/p2g/00m/0bu/003000c

Ideas:

Normally home appliances are not an everyday purchase as its more of a yearly purchase as consumers don't go appliance shopping like they do for everyday groceries.

The increase in food prices as been going on for a very long time, and maybe Japanese households continue to cutback and or find substitutes for what they usually buy.

Japanese consumer spending is about 50 percent of Japan's GDP, and if Japanese consumers continue to reduce their spending the Japanese economy most likely is going to remain stagnant for the time being.

Again, washing machines and most electric appliances are not a weekly or even a monthly purchase as they are more a yearly purchase for most consumers.

Clothing and footwear might be considered as a needs basis meaning the are bought when needed and or they are a seasonal purchase as consumers buy them depending on their seasonal weather needs.

Weather definitely has a role to play as if the weather remains of hot like it has in Japan the last few years, it could affect the buying habits of Japanese consumers like not buying winter clothes until late November or early December.

All consumers need to buy food but a 0.6% decrease might not be that noticeable there might have been a significant drop for the low-income groups who might have reduced their spending even more or looked for substitutes to buy.

Decreasing spending on recreation such as golf and even reducing spending on trips and accommodations is not a surprise as inflation continues on in Japan. 

Most likely, as inflation has continued in Japan since the pandemic period Japanese households might have been delaying repair and maintenance and waiting for repair prices to go down, but many many households decided they can't wait any longer and need to repair some things.

Japanese workers get bonuses twice a year, once in May around the Golden Week period and once at the end of December during the year-end week long holiday period.

The bonuses might be considered income to makeup for the lower salaries in Japan compared to most OECD countries. Japan has some of the lowest salaries among the G7 countries or OECD countries. 

At one time Japan has some of the highest salaries but salaries have no kept up with inflation in Japan as companies for a long time were reluctant to increase wages.

The reasons why they were reluctant to increase wages was to compete with China which at the time had much lower wages. But today the wage variance between China and Japan is much less. 

Have a nice day!