Japan Household Updated July 10, 2025.

Japan household spending up 4.7% in May, fastest pace in nearly 3 yrs

Article source:  https://mainichi.jp/english/articles/20250704/p2g/00m/0bu/007000c

Ideas

Japan's household spending might have seen a boost due to the fact that spring bonuses might have been paid before the Golden Week period.

Japanese companies usually give bonuses in the spring and at the end of the year, which conveniently helps Golden Week spending and end of the year holiday spending too.

And of course many Japanese families were waiting for the spring bonus to buy and new car some might have used it for Golden travel.

It should be remembered that the 316,085 yen is just an average and there right be some who spent more and some who might have spent much less as inflation is still a major challenge for Japanese households.

Of course the 316, 085 is not just spending on leisure items or all pleasure spending as some of it and maybe most of it might be related to spending on bills they have.

At the present time, Japan might not be significant credit card spending nation as they spend on a lot using cash but the times are changing and they too might be spending a significant amount now with credit cards.

And yes, the Daihatsu Motor Co. situation might have slowed minivehicle sales down but they might be back to normal or almost back to normal.

Daihatsu is a wholly owned subsidiary of Toyota but manufactures and produces it own type of cars.

It's interesting that Japan has maybe eight car companies but some of the lesser ones might be subsidiaries of the larger Japanese car companies such as Toyota, Honda, and Nissan.

It's interesting to note that the US only has three main car companies, excluding Tesla, but Japan has eight, which might be a point that everything in Japan is not cutthroat competition and maybe there is more cooperation that competition in the Japanese economy.

That doesn't mean all eight companies are strong companies or have excellent sales but there is something that might be working in Japan related to companies cooperating with each other.

The Japanese yen is still very strong which means Japanese travelers to overseas places might not be that many as the strong yen means Japanese travelers purchasing power is much less.

So maybe Japanese travelers might choose to travel in Japan and especially during the week long Golden Week holiday period, which is the first week of May.

Again its too early to say anything good just yet about the Japanese economy as maybe the sure in spending and travel might just be a Golden Week bump but could be back to less than good the next few months.

In the late spring period if the weather begins to get hotter and the forecast is for another hot summer of course there are going to be an increase in the buying air conditioners especially since the last few summers in Japan have seen record temperatures.

But the challenge is for the low-income and fixed income groups and the increase in energy costs over the next three or four months as the record temperatures last year lasted until the end of September.

Its possible the Japanese government might give Japanese households subsidies if the energy costs in Japan become too much like they've done in the past.

Yes, most households, even globally, spend about 30 percent of their income on food but the problem is that 30 percent is a lot more for the low-income or fixed income groups.

Most or many prices in Japan might be slowing down but the price for rice in Japan is still the major challenges as rice prices still haven't gone back to normal, as they were before the rice shortage of the summer of 2024.

Consumer spending makes up about 50 percent of Japan's GDP while in the US consumer spending is around 65 percent of GDP.

Japanese consumers usually are more savers than spenders while US consumers are more spenders than savers.

For the good of both economies if the Japanese spent more and the US saved more that might be a better option.

The average monthly income for salaried households might sound good but unfortunately Japan's average income is among the lowest of advanced economies these days when at one time in the late 1980's it was one of the highest.

Japan's economy over the past three decades has digressed and not progressed which is very sad for Japanese families.

And back in the 1980's Japan had many companies that were in the top 10 in the world. But after the 1989 asset crash everything changed and Japan has yet to really recover from that situation.

Have a nice day!