Japan July Industrial Output: Updated Sept. 9, 2025.

Japan's July industrial output falls 1.6% on month

Article source:  https://mainichi.jp/english/articles/20250829/p2g/00m/0bu/018000c

Ideas

Japan thinks it's still a major manufacturing country and maybe it still is but manufacturing  can't sustain Japan's economic growth as the exporting of cars are not like it used to be and with the US tariff situation its going to be much different.

The future trend for industrial output in Japan is going to be less and less because of the tariff situation and not just with cars but with the thousands of small Japanese companies that make car parts potentially could be much less in the future due to less demand and the tariff situation.

Japan has been riding the export bandwagon for a long time without really creating any new economic drivers for the Japanese economy. 

But its seems Japan has run out of time and now needs desperately to find some new economic drivers to help the economy grow again, as its can't rely on  exporting for that much longer to be its sole economic force.

The Japanese domestic economy just doesn't seem that strong to be an real economic driver or there isn't anything in the domestic economy to improve economic growth that much.

Some might say or think that foreign tourism, which is at record levels might help or be like an economic driver but so far its not enough to really make a difference.

An economy is a complex organism made up of many sectors and those sectors usually never grow at the same time or even decrease at the same time, but Japan needs some sectors that can be sustainable and right now it doesn't have many.

It also, at the moment, depend on exporting to the US to help its economy and the tariff situation potentially could reduce demand for Japanese cars and Japanese car parts significantly in the future.

Again, it seems Japan is only focused on manufacturing as as source of economic growth but its needs new sectors to grow the Japanese economy and its doesn't look like Japan has anything new to show to help grow its economy.

If Japan can't find or create any new economic drivers to help grow the economy its going to be stuck in that same rut of only relying on manufacturing which is good sometimes but often times its not so good and its not going to get any better in the future.

Again, Japan has relied on industrial shipments for far too long and desperately needs to find some new growth engines which it hasn't been able to do yet. 

It seems Japan is stuck back in the 20th century and only focused on manufacturing and hasn't moved into the 21st century of technology leading an economy just yet.

Yes it might be using robots or robotic equipment in manufacturing but the rest of the economy seems stuck as the Japanese economy seems to be stuck in some time warp and hasn't moved forward like other advanced economies have.

Innovation seems seem to be lacking in much of the Japanese economy as companies seem a little resistant to innovate and become 21st century companies of the future.

Have a nice day!

Japan Jobless Rate: Updated Aug. 1, 2025.

Japan's July jobless rate falls to 5-year low at 2.3%

Article source:    https://mainichi.jp/english/articles/20250829/p2g/00m/0bu/016000c

Ideas 

As some Japanese companies begin to increase wages more would-be workers are going back to work, re-entering the workforce, and many even changing jobs

For a long time many workers in Japan didn't change jobs as they just stayed with the same job as changing jobs was either shunned or not easy to do in Japan for a very long time.

But times have changed in Japan and the workforce in Japan is no longer worried about what people think and if they have a chance or need to they try to change jobs like another other place now.

Japan has always had one of the lowest unemployment rates among advanced economies as there were always plenty of jobs for those who needed to work or wanted to work.

But ever since 2008, and the global financial crisis, more jobs related to contract work, part-time work, and less than full-time salary type jobs have been offered with less and less of the type of jobs needed to grow the Japanese economy.

The Japanese economy has become an economy of have's and have nots with good full-time jobs at major Japanese companies at about 30 percent of the workforce and then the have nots about 70 percent of the work force being employed by small and midsize companies along with those with contract work or part-time work.

If 680,000 people left their current job to find a new job it might be an indication finding a new job in Japan is now not as hard as it used to be.

But then again, the opposite might be true as finding a job is a full-time endeavor as job seekers need a lot of time to find and new job and having a job might prevent them for actually seeking a new job.

At the same time 1.64 million without jobs seems like a lot of people without jobs as some might not want to work, some might be looking for work but can't find the right job for them and or there might be other reasons they are not working such as illness or other factors.

For a long time it was almost unheard of that that workers in Japan were dismissed but the article doesn't indicate what the workers were dismissed for such companies re-structuring, companies having to reduce their workforce and or the normal business actions related to workers being dismissed.

For those new people seeking jobs it could be university graduates who still don't have a job, it could be young married women who need to work to help their family with paying the bills and or any number of new workers trying to enter the workforce in Japan.

The fact that there were 122 jobs available for every 100 job seekers needs to be taken with a grain of salt, meaning not all of the 122 jobs are good Japanese name-brand large company jobs as some jobs might be jobs that pay less and unfortunately small and mid-size company jobs don't pay the same as large company jobs.

Even though there were 9.8 percent more jobs in the education sector, just what kind of jobs were being offered. Were they jobs at after-school academies that offer lessons for those in middle school and high school. Were the jobs in academies related to teaching English or other subjects?

The information and technology sector should see a lot of growth in the future with more companies trying to innovate and upgrade as needed for 21st century tech skills.

Its very possible that the hotel and restaurant industry have been hit by increased labor costs, increased raw material costs not to mention energy cost increases, and they might even had to lay-off some workers due to higher costs.

But again, the article doesn't say where the job openings decreased in Japan as foreign tourists entering Japan is at a record high which might mean hotels, at least in the major metro areas of Japan, might actually increased their workers.

As far as the wholesale and retail sector is concerned, these are service type jobs which means they usually have very thin profit margins to work with and they can't afford large increases in energy costs, wage increases, or even raw-materials costs.

Some of these companies in the hotel and restaurant sector and in the wholesale and retail sector might actually be cutting back their normal staff and not hiring new workers and moving to more automated services to save on costs.

Have a nice day!

Japan Core Consumer Prices: Updated Sept. 7, 2025.

Japan core consumer prices in July rise 3.1% on persistent food inflation

Article source: https://mainichi.jp/english/articles/20250822/p2g/00m/0bu/019000c

Ideas

Core consumer prices in Japan have been extremely high since the pandemic and haven't decrease much since then.

The pace of increase might be slowing down but most likely Japanese consumers can't see it or feel it just yet.

Not to criticize but it seems the Japanese government doesn't seem to be doing much to help the average Japanese consumer other than subsidies on energy prices lately.

For example, in the US and it the EU the US Federal Reserve increased the key rate as a way to try and reduce inflation and the central bank in the EU followed suit by also increase its key rate to try and reduce inflation in the EU.

But the Japan central banks keeps saying or has said in the past that the Japanese economy might be too weak to increase the key rate as there are could be some significant side affects from the rate increase.

Most central banks like to keep inflation around 2 percent, like the Bank of Japan is hoping for, as they feel its a manageable level and also shows there is enough economic activity moving through an economy.

In recent years, many Japanese companies were reluctant to increase prices for fear or either losing customer or alienating too many customers so they often would absorb any prices increase related to energy, or raw materials costs.

But those days seems long gone as company after company are pass-on their increased costs to the next in the supply chain including the final retail customer.

Rice seem to be in a category all by itself as the normal supply and demand actions don't seem to apply to what has been happening to rice prices since the summer of 2024.

Japan is resource-poor country which means is has to import much of what it needs including gas and oil and if global market prices are too high and or the yen is weak import prices to Japan can be very high.

Rice, again, is a major food staple for the Japanese economy and ever since the summer of 2024 the price of rice hasn't seem to follow the normal actions of supply and demand as there seems to be some other actions that are controlling the price of rice in a country that considers rice a very important part of its food supply.

It could be mismanagement, it could be neglect, it could be cartel type actions but so far none of these actions have been given for the continuous high price of rice.

Most likely as the summer moves on most new air conditioners were probably bought in March or April which means that there weren't as many AC's bought later in the summer months, and as the summer moves close to the fall season most likely retail places are reducing prices to clear out the last inventory of AC's for the year.

Service type companies usually have very thin profits margins so if a company had wage increases for their workers they would have passed-on their costs to the next in the supply chain including the final retail customer.

The Bank of Japan, like most central banks are very conservative so they will take their time to see on what to do about curbing rising prices and what the affect of the US tariffs are going to have on the Japanese economy.

As far as the April-June period and the GDP the Japanese economy just doesn't grow that fast as its in a mature phase now for an economy and economic growth doesn't really happen that fast with mature economies unless there some kind of action that might spur some growth which just hasn't happened in Japan for a very long time.

For example the only real economic driver, lately, for the Japanese economy is exports but Japanese exports are going to be less than normal due to the US tariff situation which could reduce exports, maybe not significantly but enough to have an affect on the Japanese economy.

Unfortunately Japan just doesn't have any other economic drivers as its domestic economy just doesn't have to fuel needed to improve economic growth.

Some might say the record surge of foreign tourists into Japan might be the next economic driver for the Japanese economy, but so far, while very good. it hasn't really improved the economy that much yet, as Japan just doesn't see the amount of tourists that countries like Spain and France have at this time.

Have a nice day!

Japan US Exports: Updated Aug. 5, 2025.

Japan's US exports fall 10% in July, down for 4th straight month

Article source: https://mainichi.jp/english/articles/20250820/p2g/00m/0bu/019000c

Ideas

As has been reported in other articles recently Japanese car makers reduced the prices of some cars and exported cheaper models to the US which reduced the value of Japanese exports.

For Japanese cars manufacturers and car parts producers its hard to plan correctly as they still don't know what the final tariff rate will be as it's still up in the air and it can change day to day.

Again, Japanese car manufacturers have started exporting less expensive cars to the US which of course will reduce the trade surplus.

The trade surplus is very important for the Japanese economy as its part of Japan's current account and offsets imports coming into Japan.

Japan is resource-poor country and has to import much of what it needs which reduces Japan's current account while exports increase the current account.

At the same time, lately, the only real economic driver for the Japanese economy has been exports as there doesn't seem to be any other real economic activity that increases economic growth.

An economic driver is any economic activity that significantly increases economic growth and Japan has very now.

Again, Japan is a resource-poor country which means it imports much of what it needs and crude oil and coal are key import commodities that Japan needs to function.

But again, imports deplete Japan's current account and lower import prices help to improve Japan's current account and helps to lower Japan's trade deficit.

Japan re-built its economy on exporting as they knew that the domestic economy was/is not strong enough to grow the economy alone, but it seems that Japan hasn't been able to harness any domestic economic activities to really help the economy grow besides exporting.

While the tariff rate at 15 percent is much better the timing of when it will be implemented is the key factor as Japanese companies still don't know when the tariff rate will go into affect which means they really can't plan much just yet.

Even at 15 percent most likely the large Japanese car makers will be relatively safe while the smaller car makers might have challenges absorbing the tariff rate and will eventually have to pass-on the rate to the next in the supply chain, unless the smaller Japanese car makers and their larger partner work together to the shock on the smaller car makers.

At the same time, Japan has thousands of small car parts manufacturers that are going to be challenged and their profit margins are probably too small to absorb the tariffs and they too will need to either pass-on the tariff rates to the next in their supply chain and or get help from the large Japanese car manufacturers.

Again, its not just the large Japanese car manufacturers such as Toyota, Honda, and Nissan that will be affected but thousands of small car parts manufactures and many other companies in Japan that export to the US. 

While the Japanese government can't help everyone they should target which industries or sectors they feel are the most vulnerable and find ways to help them such as the thousands of smaller car parts manufacturers in Japan they might make only one or two products used in cars.

And at the same time the Japanese semiconductor industry in Japan was just beginning to get back on its feet and finally back in the semiconductor game after losing significant market share to Taiwan and South Korea and is probably another vulnerable industry that the Japanese government needs look at and find ways to protect those companies.

The US economy is not as robust as it was a few years ago and prices seems to be increasing again, and if Japanese car makers pass on the tariffs rates to the next in the supply chain it might mean US Japanese car dealer ships will increase their prices and US consumers might not like the idea of more increased prices to deal with.

And then yes, US car dealer ships or whomever in the supply chain will say the can't or don't need any more cars as they can't sell the cars they have now on their lots.

Japan car makers maybe need to prepare for a slow year in 2025 or even 2026 and prepare their stockholders not to expect much growth the next few years until they can figure out how to deal with the tariff situation and or hope China's economy begins to growth again.

The Chinese economy is not in a good place at this time as its still dealing with internal economic challenges and still hasn't been able to work those challenges out just yet.

As the same time, Japanese car makers are experiencing robust competition from the up and coming Chinese car makers who are gaining significant market share daily and not just in China but globally too.

China is still a very significant market for Japan and Japanese companies like most global companies can't afford to give up on China as its surging middle class is getting bigger by the day.

Japanese companies probably need to re-set what it is they really want out of China and not expect too much as competition in China from Chinese companies it taking a lot of market share away from Japanese companies.

Aside from China being the weak link in Asia, at the present time the rest of Asia looks robust and looks like the markets in the rest of Asia are going to be a life-line for Japanese companies that might be seeing reduced exports to both the US and China.

And again, unfortunately the European Union is a weak link as exports to that area of the world just keeps getting weaker and weaker. 

Blame it on the Ukraine war and or weak demand in the EU or any other reason for the continued low exports to the EU.

Have a nice day!

Japan Bankruptcies: Updated Aug. 25, 2025.

Japan bankruptcies in July hit highest for month in 2025

Article source: https://mainichi.jp/english/articles/20250808/p2g/00m/0bu/048000c

Ideas

Bankruptcies are never a good thing as people and their families are always affected. However, in economic terms it might be a leveling out of some of the markets where might be too many companies for the market. That still doesn't take away all of the pain and suffering  of a bankruptcy. 

Any time in a market which has a lot companies due to growth in the market and more companies enter the market eventually the market might become saturated with too many companies and some companies begin to see decreased sales and profits.

With that said, increased prices are not good thing and maybe the Japanese government could have found ways to help some of the companies stay in business if possible.

But then again, some might think too much interference in the governments interfering in the mechanisms of the market it being too much.

Debt involving 10 million yen or $68,000 doesn't seem like that much for a company but we don't know the exact circumstances of each case.

Perhaps the banks related to the companies were not able or unwilling to extend anymore credit and or suppliers were unable or unwilling to give them more materials as needed to stay in business.

As Japan is in a labor shortage perhaps some companies just couldn't afford to pay the wages needed to get some workers as they knew they could get better wage at other companies.

For many years many Japanese companies absorbed the increase in energy and materials costs but over time they came to a breaking point and had to eventually pass-on the higher costs to the consumer.

But some companies even after passing-on their costs their costs continued to increase and then the  labor shortage hit in Japan and they had to start paying higher wages to keep good workers and that became even more of a problem for some companies.

And yes, there could be even more bankruptcies and more and more companies are unable handle both increased costs and increase labor challenges.

Some of these companies might be considered zombie companies or the walking-dead companies that are barely existing and some might think the government might just be letting them die off but that is never the case in Japan.

Both the retail sector and the service sector have very thin profit margins and maybe they just can't handle the increased in energy and materials costs along with not being able hire more workers and their profits margins just can't handle any more costs as their profits just keep decreasing.

Again, its quite possible, and it usually is, where a market becomes very popular and more companies enter the market, such as the restaurant and food service market and then eventually there are too many in that market and some restaurants begin to see a decrease in sales and eventually a decrease in profits and then some of the companies in that market have to exit the market.

And its the same with retail stores too where too many retail stores enter the market and then there are too many and the same thing happens and the market adjusts itself by profits decreasing with some retail places and some exit the market and then the market eventually gets back to some kind of equilibrium. 

Have a nice day!

Japan Economy Growth: Updated Sept. 4, 2025

Japan economy grows 1.0% in April-June, inflation weighs on spending

Article source: https://mainichi.jp/english/articles/20250815/p2g/00m/0bu/014000c

Ideas

An economy is a complex organism and it has many different parts or sectors which some see growth and some see less growth. All sectors in an economy are never linear as there are periods of growth and less growth in each.

The Japanese economy rarely see growth beyond 1 percent but even at 1 percent growth that is significant growth for an economy the size of Japan's.

Capital investments are always an important economic indicator for what is going on in an economy as it shows businesses might see the economy improving over time.

But again the major challenge for the Japanese economy is consumer spending as inflation continues to be a major constraint for consumers in Japan.

Yes, the tariff situation might not have been in full effect yet so Japanese exports to the US remained robust for now, but the future might be a little more challenging as Japanese companies might have to start absorbing the tariffs.

Japan might need to re-think its entire strategy with exports as the profits and sales from exports could see significant decreases in the coming months.

Japan is now a mature economy and advanced economy which usually means less economic growth as it takes more resources to grow a mature economy compared to an emerging economy.

As a result even 0.3 percent growth, for Japan, might be considered acceptable as some growth is still better than no growth or negative growth.

Economic data is always being revised as new data become available and all economies always revise their data as needed.

Data should never be taken as complete or static as it's always being looked at again and again to make sure that it's relevant for the situation and always being revised as needed.

Capital expenditures are important for an economy as it shows how much businesses spend just like consumer spending is important for an economy too which of course shows how much consumers spend in an economy.

The fact that software investment might have driven the increase in capital investments might indicate that Japanese companies are finally beginning to take seriously the need to innovate and bring their companies into the 21st century.

And it looks like Japan is becoming, again finally, a semiconductor focused country after losing a lot of market share to Taiwan an South Korea.

Exports in Japan are a major economic driver, which means its contributes a lot to the economic growth of the Japanese economy.

But the future of exports in Japan are clouded as the tariff situation with the US is still very unclear as to what is going to happen exactly.

Japan car companies are now using different strategies to overcome the tariff situation such a reducing prices on cars to the US, offering different models than before as a way to stimulate sales and try to keep profits high.

Many years ago the strategy of Japanese export companies to the US were always focused on improving market share and always offered low product prices. 

But those days are long gone as Japanese companies can't afford to keep prices low for too long without compromising their profit margins.

Japanese car companies, along with all of the smaller car-parts companies in Japan employ a  lot of workers and if profits are decreased too much then yes, salaries and employment will be effected along with consumer spending from those who who work for car related companies.

The GDP formula is consumer spending + business investment spending+ government spending + exports -imports, which means imports actually decreases what the initial GDP might have been with just exports.

Imports reduce an economies current account, which is like an economies bank account, and in Japan's case as it its a resource-poor country has to import much of what it needs which means it can have a significant effect on Japan's GDP growth.

And yes, the tariff agreement might not be as bad as first expected but its still not going  exactly in Japan's favor and will affect the amount of exports from Japan to the US.

Yes, the July-September period potentially could see negative growth as maybe Japan is too reliant on exports as it really doesn't have any other economic drivers at this time.

Private consumption, or consumer spending, which is about 50 percent of Japan's GDP is not up to the task of helping the economy or overcoming the drop in exports as inflation continues to effect Japanese consumers.

And then add it the low wages for workers in Japan and they really don't have enough disposable income to spend like US consumers do, which makes up about 60 percent of the US GDP.

The Japanese economy is dealing with many years of Japanese companies not giving adequate pay increases to their employees and now the economy is suffering from low consumer spending due the fact that Japanese consumers just don't have the disposable income they need as they haven't had adequate pay increases for many many years.

Its might take a few more years with increased pay wage increases for Japanese consumers to finally feel good enough to really start spending again, but again it's going to take several years for the pay increases to have some kind of effect on the Japanese economy.

Nominal GPD is not really important as what is important is real GDP as real GDP shows what the consumers purchasing power really is in an economy, meaning how much money does a consume really have to spend and more important how much disposable income do they have to use in the economy.

Have a nice day!

Japan Ideas: Updated Aug. 28, 2025

Firms believing Japan economy growing falls to 30% amid tariff woes

Article source:  https://mainichi.jp/english/articles/20250810/p2g/00m/0bu/026000c

Ideas
The Japanese economy never grows that much or that fast and now with the tariff situation it might grow even slower.

Japanese companies might have to re-set what they think is good economic growth and or communicate to their stockholders that earnings as before are not going to be the same.

And companies, if they are thinking of absorbing the tariff costs, can only do it for so long before their profit margins begin to suffer and they have to pass-on the tariff costs to the next in the supply chain.

Surveys are good and needed and important but they don't tell the whole story as companies are made up of people and people can change their minds as the business environment can change quickly sometimes.

It also must be remembered that companies who are doing good during the survey might think the economy is good while those companies that aren't doing good might think the economy is not doing so good.

The Japanese economy has been flat for a very long time with little or very little economic growth, as the past 30 years have shown.

Solid business performance is always needed and good but it might take Japanese companies to be more creative and even begin to innovate so that productivity is the real economic driver for Japanese economies.

Companies that rely on normal, business as usual business activities might be left behind in the new global trade situation that has been created.

It can no longer be business as usual for Japanese companies and they can't rely on old practices to keep them afloat as they need to find ways to innovate and allow innovation to be the the key economic driver for them.

Yes, the global economy is in a new-normal and Japanese companies will need to find ways to grow and even find ways to adapt and change to the new global economy.

Nothing stays the same in business or the real world and the sooner Japanese companies find ways to adapt, innovate, stay ahead of the curve the sooner they can get back to being titans of the global economy like they were many years ago.

At one time Japan had some of the largest companies in the world but somewhere along the way they lost their way and now only Toyota is listed as a top global company.

For a long time many Japanese companies were reluctant to increase prices and they felt their customers would not like it so they absorbed cost increases for many years.

But those days are long gone as company profit margins have shrank and stockholders are demanding a prescribed level of profits each quarter.

And yes, the labor shortage has forced companies to increase wages for existing employees and to get new employees to work for them in the future.

It has been suggested that for a long time Japanese companies were sitting on large sums of money and not really paying their employees the wages that were needed to help the Japanese economy grow.

So maybe now, finally, Japanese companies have decided that to grow the economy and grow their business are equally beneficial pursuits.

Again, while the wage increases are needed and good they can't make up for the number of years that companies gave either very low wage increases or no wage increases at all.

It all adds up with a synergy effect taking place after too many years of low wage increases and or no wage increases at all affecting the Japanese economy.

And again, that 5.25 percent wage increase might be considered good by some and maybe that is all some companies can do, but if companies had been giving reasonable wage increases all along maybe the 5.25 percent might have been adequate.

Real wages are very important for the Japanese consumer and of course Japanese workers as it indicates their purchasing power or how much they can really spend in the economy.

The Japanese economy has dug itself into a major hole and it's going to take time to dig its way out and there needs to be even more wage increases for all workers in Japan.

For example up to 70 percent of the Japanese workforce doesn't work for the large name-brand companies but small and mid-size companies that maybe can't afford to pay the same wage increases as the large companies do.

Which means the Japanese economy is kind of stuck with two realities, the haves, the large company workers and the have nots, the small and midsize workers what don't have the same wage increases as their large companies workers do which then means less disposable income left to spend in the Japanese economy, which then means less economic growth in the future.

Have a nice day!

Japan Household Spending: Updated Aug. 13, 2025.

Japan's household spending rises in June for 2nd straight month

Article source: https://mainichi.jp/english/articles/20250808/p2g/00m/0bu/028000c

Ideas

Japan household spending is always suspect as inflation continues to be a constraint on spending in Japan.

It must be remembered prices in Japan are always a problem as the increase in prices covers-up how much Japanese consumers really spend.

As the summer in Japan continues to get hotter, the electricity prices will continue to go up and Japanese households try to stay cool.

Auto purchases are not a weekly purchase as they might be bought once ever few years if even that.

Spending in Japan, like other countries might be more related to inflation and things consumers need to buy instead of buying for what they want.

So the 295,419 might be more related to having to buy things instead of wanting to buy things.

And yes, as far as the tariffs go, Japan consumers probably are not going see the real effects anytime soon as Japanese companies and importers, initially might absorb the costs but overtime might begin to pass-on the costs to the Japanese consumer.

Japan has had certification problems for a few years and can't seem to get past it, as there might have been deliberate attempts to keep production going or just simple lack of awareness during the certification process.

Food prices just keep going up in Japan and then there is the rice situation which has been on-going now for over a year.

To make matters worse this summer is another record breaking heat which is going to significantly effect the rice harvest for 2025.

The so-called cheaper rice brands are probably just as good as the so-called name brands but Japanese consumers were reluctant to buy the cheaper brands until they have been hit consistently with high rice prices.

And yes, whenever there is a major heat wave there is always going to be a rush to buy air conditioners.

An increase in housing repairs and maintenance costs might be the result of Japanese workers getting their summer bonuses and used the bonuses to repair their homes.

Private consumption or consumer spending is always a challenge for the Japanese economy, as Japanese consumers just don't spend enough to help the Japanese economy move forward, as they are more savers instead of spenders like in the US.

The fact that real income fell means that inflation in Japan continues to be high despite companies increasing wages and or increasing summer bonuses.

Which eventually means less spending in the Japanese economy as Japanese consumers have less purchasing power.

While the high summer bonuses are good for large company workers but the same can't be said for the 70 percent of workers in Japan that work for small and mid-size companies which just don't have the needed resources to pay the same summer bonuses or even the same wage increases which usually take place in April.

So the Japanese economy, if its not there yet, is headed for a system of have's, large company employees who make up about 30 percent of the Japanese workforce and the have-nots, which make up about 70 percent of the work force, and the income inequality is only going to get worse every year in Japan, which means less consumer spending in the Japanese economy over time.

Have a nice day!

Japan's Current Account: Updated Aug. 24, 2025.

Japan's current account surplus grows 9% in 1st half of 2025

Article source:  https://mainichi.jp/english/articles/20250808/p2g/00m/0bu/026000c

Ideas

A surplus puts money into Japan's current account while a deficit reduces money in the current account.

Another way is exports put money into the current account while imports take money out of the current account.

Japan seems to be very dependent on increasing its current account as exports seem like its a major economic driver for the Japanese economy.

It should be remembered that the Japanese yen might have been weak which increases the value of exports along with increasing the value of foreign investments.

At the same time Japan companies, as a way to avoid the US tariff, might have increased exports before the tariffs took effect.

Japan for a long time had become less competitive related to semiconductors as Taiwan and South Korea were the market leaders related to semiconductors, but now Japan seems to be back in the game.

Japanese cars are definitely an economic driver which significantly helps an economy grow, but the problem is Japan, at the present time, has few economic drivers to help grow the economy.

It's possible the value of imports, due to the weak Japanese yen, might have increased, while of course the value of new products might have increased at the same time, as inflation, globally, keeps increasing.

And to be sure, at this time the impact of the tariffs might not have effected Japanese imports into the US just yet.

The weak Japanese yen might have increased the value of dividends along with finance, insurance, and telecommunications. Its not so much the volume increased but the value of the products increased.

It must be remembered there is a difference between the value of product and the volume of a products which sometimes gets confused.

While foreign travelers who spend a lot in Japan might be considered an economic driver. The number of foreign visitors, while at record levels, is still not high enough to be considered an economic driver just yet, as impact on the Japanese economy is improving its not enough to significantly effect the overall economy.

At the same time of course not as many Japanese traveled overseas as the weak Japanese yen, for Japanese travelers becomes a strong currency which reduces a person's purchasing power in another country.

Again, while a surplus in the travel balance is good and helps the Japanese economy its no where near where Spain and France are yet which are the global leaders in foreign travelers entering their respective countries.

Japan has known for a long time that foreigners coming to Japan and spending a lot helps the Japanese economy so they have reduced visa restrictions for many in other countries now.

But the real challenge is opening the flood gates and letting more foreigners into the country to work which will greatly improve the Japanese economy, but Japan is a little hesitant at this time to open the gate too much.

Have a nice day!

Japan Companies and Wage Increases: Updated Aug. 21, 2025.

Major Japanese firms' monthly wage hike tops 5% for 2nd straight year.

Article source:  https://mainichi.jp/english/articles/20250806/p2g/00m/0bu/041000c

Ideas:

While its good that large company employees got a wage increase of more than 5 percent, it should be remembered that up to 70 percent of Japanese workers don't work for large Japanese companies but rather small and midsize companies, which usually don't have the resources needed to pay the same wage increase as large companies.

What this means is small and midsize workers in Japan might not have the same amount of disposable income to spend in the Japanese economy which of course might mean less economic growth.

Many companies are increasing wages as a way to keep needed workers and to lure needed workers to work for them. But the problem is, again, many small even mid-size companies just don't have the resources needed to attract workers as, yes, there is a definite labor shortage in Japan that is going to maybe cause some small Japanese companies to close.

Unfortunately, now with the US tariff situation Japanese export companies could be significantly affected which means as profits decrease and profit margins decrease small and mid-size Japanese exports companies are going to be the effects of the tariffs the most. Large Japanese companies that export might be able to absorb some or most of the tariffs.

It could be suspected or maybe even assumed that large Japanese companies, as reported in some articles years earlier, that large companies were hording cash and for a long time didn't give significant wage increases to their workers.

But many Japanese companies, especially publicly traded companies, are not obligated to take care of their shareholders first and not so much about companies workers who now might just be considered commodities to be easily laid-off when needed.

Non-manufacturing companies, which many are service-type companies, usually don't have large profit margins and can't afford to pay the same wage increases that manufacturing companies can pay.

While its good to focus on what large companies did with wage increases, but again, it must be remembered that 70 percent of Japanese workers don't work for large companies but small and mid-size companies.

Large companies, globally, in every country usually get all the news but most economies are made up of small and mid-size companies that employee more workers than large companies.

Large companies might drive some of an economy but they don't drive the majority of an economy which small and mid-size companies do when everything is added up.

And the spending in an economy by small and mid-size workers might be significantly more than what the 30 percent of large companies employees spend in an economy.

So its a mistake to ignore the small and midsize companies or their workers in an economy as not being very significant when if fact they might out-spend large company workers by 3 times.

Have a nice day!