1. travel
2. tourist destinations
3. japan

General Summary of Regional Economic and Industrial Research Results (from October to December 2014) (1/2)
Reference 2
The overall assessment remains the same as that in the previous quarter. As for the assessments for each economic
region, those for Hokuriku and Kyushu have been revised upward from the previous quarter, those for Tohoku,
Kanto, Kinki, Shikoku, and Okinawa remain the same as in the previous quarter, and those for Hokkaido, Tokai,
and Chugoku have been revised downward from the previous quarter.
○ Production: In the automobile and automobile-related industries, centered on demand in North
America, production remains steady in Hokkaido, Kanto, Tokai, Kinki, and Kyushu, but domestic
demand continues to be in a weak tone, showing weak movements as a whole. Production in the
electronic devices industry remains steady for smartphones and automobiles for export in Tohoku,
Kanto, Hokuriku, Kinki, and Kyushu. Moreover, the general-purpose, production, and business
oriented machinery industries have maintained steady overseas demand in Hokkaido, Tohoku, Kanto,
Tokai, Hokuriku, Shikoku, and Kyushu.
○ Business investment: In manufacturing industries, business investment continued to be centered
on the maintenance and renewal of equipment nationwide from the previous quarter, and there were
some movements in investment for production capacity enhancement and setting up plants. In nonmanufacturing industries, movements of opening new stores and remodeling existing stores have
continued to be seen nationwide in the retail industry, while some retailers in Hokkaido, Tohoku and
Kyushu responded that they would reconsider their plans to open new stores due to soaring
construction costs.
General Summary of Regional Economic and Industrial Research Results (from October to December 2014) (2/2)
○ Employment situation: In manufacturing industries, some companies continued to face a labor
shortage from the previous quarter with movements seen of an increase in employment due to
increases in production and orders received, while some other companies have secured an appropriate
number of employees. In non-manufacturing industries, a labor shortage continues to be seen in the
retail, services, and construction industries on a nationwide basis, and some respondents pointed out
that they faced difficulty in securing part-time staff.
○ Private consumption: Although sales of luxury goods at department stores and food at
supermarkets are picking up nationwide, those of clothing remain sluggish due to the effects of
weather. The effects of a reactionary decline after the last-minute increased demand preceding the
consumption tax hike remain in sales of automobiles and home appliances. As for private consumption,
high willingness to buy luxury goods and new products is evident, while budget-minded attitudes still
persist for daily necessities. Thus, some respondents pointed out that a stark polarization in consumer
attitudes has spread, and that recovery of sales has been delayed in suburbs compared with city centers.
As for travel, some respondents pointed out that consumption by foreign tourists increased in
Hokkaido, Kanto, Kinki, and Okinawa.
Region
General
economic
conditions
Spreading of
weak
movements
amid a
continuous
Hokkaido moderate
recovery
trend
（ ）
Description of sector-specific conditions (major comments)
○ Production is in a weak tone although it remains flat. （ ）Production in the general machinery and electrical
machinery industries continues to be brisk, reflecting the yen’s depreciation, etc. In the transport equipment industry,
overseas demand including that in North America for automobile parts is steady, while the effects of a delay in recovery
of domestic automobile sales are seen. Moreover, production in the steel, ceramics, stone and clay, and metal products
industries is on a downward trend, mainly due to the effects of a decline in public works caused by orders finishing ahead
of schedule, delays in work caused by a shortage of skilled workers including reinforcing ironworkers and mold makers,
and a shortage of drivers for transporting steel. A rise in raw materials prices and energy costs mainly due to the yen’s
depreciation is causing a decline in profits in a wide range of industries, as well as effects on the production of consumer
goods such as food and paper due to the high cost of living.
○ Business investment shows signs of picking up. (→) In addition to the maintenance and renewal of equipment,
investment for R&D and capacity enhancement in manufacturing industries, and openings of new large-scale retail stores
and energy-saving investment including introducing LED lights in non-manufacturing industries have been made. As for
opening new stores, there are some cases of delays in construction schedules mainly due to a labor shortage and
reconsiderations of plans due to a rise in construction costs.
○ Employment is moderately improving. (→) The effective ratio of job offers to applicants has been on a recovery
trend over the long term, though it is at a lower level compared with the national ratio. Mismatches continue to arise
between the employer’s needs and those of job seekers, bringing about labor shortages in terms of workers at food and
transport equipment plants in manufacturing industries. In non-manufacturing industries, labor shortages can be seen in
terms of drivers in transport-related industries, cashiers and workers dealing with fresh items in retail-related industries,
and engineers including system engineers in information service-related industries. Securing human resources in areas
other than the Sapporo area is especially challenging.
○ Private consumption shows a weakness in movements of picking up. （ ）At large-scale retail stores, although the
reactionary decline after the last-minute increased demand preceding the consumption tax hike is fading away, there are
movements of refraining from non-essential and non-urgent consumption of things including clothing and personal goods.
Moreover, sales of durable goods including new cars and home appliances are poor, showing weakness in movements of
picking up. As for travel, inbound travel continues to be brisk, resulting in an increase in sales of duty-free items at
department stores, etc., as well as remaining at a high hotel-occupancy rate even in the winter off-season.
Comments from companies
- Public works are seeing increases in maintenance rather than new construction, and are not really leading to growth in building materials. We believe that the
budget increase was absorbed by soaring labor unit prices due to a labor shortage. (Small- and medium-sized manufacturer)
- Sales of duty-free items to foreign customers doubled or tripled compared with the previous year, with brisk sales of watches, luxury brands, and cosmetics.
(Large retailer)
- Amid a labor shortage, we established a new regular employee system with fewer unfavorable employment conditions, including guaranteed stability in
location, to secure good human resources, resulting in an increase in applicants. (Large travel agency)
Region
Tohoku
General
economic
conditions
Showing
some weak
movements
amid a
moderate
recovery
trend
（ ）
Description of sector-specific conditions (major comments)
○ Production continues to see strong and weak periods.（ ）Production is in a weaker state in industries such as the transport
equipment industry due to a reactionary decline after the last-minute increased demand preceding the consumption tax hike, and the
information and communication equipment industry, in which replacement demand for PCs had peaked, as well as the paper and pulp
industries. On the other hand, production remains steady in the ceramics, stone and clay industry and non-ferrous metal industry due to
disaster reconstruction demand. In addition, some respondents see brisk demand in some electronic parts and device and food
industries, as well as the general machinery industry, in which a recovery trend for export can be seen.
○ Business investment is moderately picking up. (→) In the manufacturing industries, there are many companies that have
increased investment compared with the previous year due to new orders received, in addition to investment for production capacity
enhancement reflecting the favorable business conditions. In non-manufacturing industries, business investment is centered on
maintenance and renewal of equipment, and there are many companies that have decreased investment or remain at the same level.
Although retailers continue to show proactive attitudes toward opening new stores, there are some movements to reconsider opening
plans due to a decrease in appropriate properties and a rise in construction costs. In addition, some manufacturers with severe profit
conditions also show signs of downward revision.
○ The employment situation continues to improve. (→) The employment situation continues to improve, with both the ratio of
new job offers to applicants and the effective ratio of job offers to applicants remaining at a high level, supported by reconstruction
demand. There is a strong sense of an insufficient number of salespersons in the retail industry and engineers centered on site
management in the construction industry. Some manufacturers show movements of increasing job offers due to a shortage of
employees.
In coastal areas in disaster-affected prefectures, the effective ratio of job offers to applicants for medical and welfare–related jobs and
engineers, as well as sales and service and production-related personnel is at a higher level than that in other areas, creating a strong
sense of a labor shortage among employers, while a noticeable mismatch of jobs, etc. such as less offers for clerical staff among job
openings, is causing the severe situation to continue.
○ Private consumption shows some weakness amid a recovery trend. (
) Although sales at large-scale retail stores are on a
recovery trend centered on steady food and beverage sales, there is some weakness in clothing sales, etc. Moreover, year-on-year
comparison shows the reactionary decline to region-wide sales celebrating the professional baseball team’s victory. Sales of home
appliances and the number of sales of new cars decreased from the levels of the previous year. There are some concerns about
intensifying low-end and budget-minded attitudes and a rise in procurement costs due to the effects of the yen’s depreciation, while
there are some expectations for an increase in consumption due to a decline in gasoline prices and consumption at events such as New
Year sales.
Comments from companies
- Exports of in-car products and products for smartphones are brisk, so we respond by operating at full capacity. (Large manufacturer/Akita Prefecture)
- We expected a recovery from the reaction to the consumption tax hike, but consumer confidence is declining due to price hikes. (Large retailer/Yamagata
Prefecture)
- Some luxury goods begin to show movements including whisky due to the effects of a TV program. (Large retailer/Miyagi Prefecture)
Region
General
economic
conditions
Description of sector-specific conditions (major comments)
○ Production continues to see strong and weak periods.（ ）Although the transport equipment industry faces a severe
situation for domestic sales, demand in North America remains brisk. In the general machinery industry, orders of
construction machinery and machine tools remain steady due to policy effects including the investment promotion tax
system. In addition, overseas demand for electronic devices for automobiles in North America and for smartphones in
China is brisk. As for future prospects, there are concerns about the effects of the soaring raw material costs caused by
continuing depreciation of the yen.
○ Business investment is moderately picking up. (→) In manufacturing industries, business investment is made
according to the original plans centered on the maintenance and renewal of equipment. Moreover, some companies
postpone investment reflecting a decline in demand, while investment is made to enhance production equipment in some
companies or overseas bases in some large companies to deal with an increase in demand. Investment in nonmanufacturing industries is centered on remodeling and aging countermeasures for existing stores and opening new stores
Picking
in line with original plans.
up
○ The employment situation is moderately picking up. (→) In manufacturing industries, although there is a sense of a
labor shortage at production sites reflecting an increase in orders received and production, there are cautious movements
Kanto
of increasing the number of employees due to uncertainties about the future. In non-manufacturing industries, there
continues to be a sense of an insufficient number of engineers at construction sites to conduct site management and
salespersons at stores in the retail industry, etc. In addition, there is a tendency of job seekers to flow into jobs or areas
with better working conditions. Thus there are strong concerns that a situation of failing to secure as many human
resources as expected will continue for the future.
○ Private consumption is picking up. (→) Although sales of luxury goods and inbound duty-free items at department
stores continue to be brisk, a stark polarization in consumption patterns is further advanced. Automobile sales continue to
show a slowing trend despite a decrease in the reactionary decline after the last-minute increased demand preceding the
consumption tax hike. Convenience stores conduct product development matching consumption characteristics and
continuous introduction of new products against soaring raw materials costs while suffering the effects of the two
typhoons. Regarding travel, domestic trips continue to be brisk despite being affected by unstable weather, as well as
focusing on acquiring inbound tourists. As for everyday necessities and restaurants, consumption is weak due to the
persisting budget-minded attitudes of consumers.
Comments from companies
- Export industries (automobiles, etc.) are booming due to the trend of the yen’s depreciation. (Small- and medium-sized manufacturer/Shizuoka Prefecture)
- We will invest in machinery for production increases in Vietnam. (Large manufacturer/Tochigi Prefecture)
- Regarding increase of employees, we always think about the case of a future decline in work as well as hiring centered on high-quality human resources.
(Small- and medium-sized manufacturer/Tokyo)
- It is difficult to make a hotel reservation in Tokyo due to the effects of foreigners visiting Japan. In addition, hotel prices are not coming down. (Large
services business/Tokyo)
（→）
Region
Chubu
(Tokai)
General
economic
conditions
Showing
some pause
while
improving
moderately
（
）
Description of sector-specific conditions (major comments)
○ Production shows signs of picking up. （ ）In the core automobile-related industries, overseas demand remains flat,
while domestic demand is in a weaker state. Production in the electronic parts and devices industry shows signs of
increasing mainly for smartphones. Production of metal-cutting machinery is moderately picking up, showing policy
effects including the subsidy and the investment promotion tax system for production equipment in terms of domestic
demand, as well as steady demand in North America. In addition, corporate profits are improving centered on exportdriven companies due to the yen’s depreciation. On the other hand, some small- and medium-sized companies continue to
face a decline in profits, reflecting a rise in raw material costs, fuel costs, and electricity rates.
○ Business investment is increasing moderately. (→) In manufacturing industries, domestic investment centers on
investment for streamlining, efficiency, maintenance and renewal, and investment in production capacity enhancement is
seen in some electronic parts and devices and motor vehicle parts industries. As for overseas investment, investment
activities for production capacity enhancement in North America and emerging countries are seen. In non-manufacturing
industries including the retail industry, there are movements toward remodeling stores and opening new stores, such as
department stores and supermarkets.
○ The employment situation is steadily improving. (→) In manufacturing industries, production can be completed with
overtime work and the current number of non-regular workers in many companies. In addition, some small- and mediumsized enterprises have intended to hire excellent human resources for overseas development and technology development,
but such human resources are hired by large companies. In non-manufacturing industries, the sense of an insufficient
number of non-regular employees has increased in the retail industry, including supermarkets and convenience stores, and
a situation persists in which the number of applicants is insufficient to meet the number of offers.
○ Private consumption shows a slowing trend although it is moderately picking up.（ ）Sales at department stores
continue to have good performance in luxury goods, with poor performance in items such as winter clothing because of
consumer’s severe sense of balancing prices and values. At supermarkets, sales of food and beverages are steady, but the
number of customers decreased due to intensified competition between businesses handling similar products. Automobile
sales and housing investment show a reactionary decline after the last-minute increased demand preceding the
consumption tax hike. Sales of home appliances continues to be below the levels of the previous year, although new
smartphone models show a good performance.
Comments from companies
- Domestic demand for parts for automobiles is a little low. We feel that the reactionary decline after the last-minute increased demand preceding the consumption tax hike persists. On the
other hand, we revised this year’s earnings estimates upward, reflecting the sharp depreciation of the yen. (Large motor vehicle parts manufacturer/Aichi Prefecture)
- The yen’s depreciation leads to an increase in profits of a consolidated overseas subsidiary, but it is a nominal increase in profits, resulting in a negative cash flow in light of tax payments.
Our profit margin is shrinking due to the rise in supplies expenses, fuel costs, and electricity rates. It is quite difficult to pass the higher cost along to consumers. (Small- and medium-sized
forged product manufacturer/Aichi Prefecture)
- Increases and decreases in sales are clearly divided by product lines, such as continuous brisk sales of luxury goods and sluggish sales of clothing. (Large department store/Aichi Prefecture)
- The number of customers declined due to competition between businesses handling similar products and in other categories. (Large supermarkets/Gifu Prefecture)
Region
Chubu
(Hokuriku)
General
economic
conditions
Showing
signs of
improvement
（ ）
Description of sector-specific conditions (major comments)
○ Production is increasing. (→) Production in the electronic parts and devices industry is brisk for smartphones
and automobiles for overseas. Production in the chemical industry is brisk, centered on generic drugs and contract
manufacturing. Production in the general-purpose, production, and business oriented machinery industries increased
with economic policy effects in Japan, in addition to brisk overseas demand in sectors including machine tools. In the
textile industry, although demand for domestic clothing is sluggish, demand for high-density thin fabrics for overseas
is brisk. Production in the metal products industry, especially in manufactures of residential sashes, is in a weaker
state due to a continuous reactionary decline after the last-minute increased demand preceding the consumption tax
hike in.
○ Business investment is increasing. (→) In manufacturing industries, some companies invest domestically for
enhancing equipment in response to R&D for new products and production increases, and for setting up new plants.
Moreover, overseas investment has intensified, including setting up and adding plants where there is demand. In nonmanufacturing industries, energy-saving investment has been made, aiming at cost reductions. In addition, there are
some active movements for the purpose of improving the ability of attracting visitors ahead of the opening of the
Hokuriku Shinkansen.
○ The employment situation is moderately improving. (→) In manufacturing industries, companies whose
production is at a high level are handling labor shortages by increasing non-regular employees, including temporary
staff and shifting regular employees from other departments, but there are some movements of increasing regular
employees, including converting non-regular employees to regular employees in light of securing human resources.
In non-manufacturing industries, although job offers continue to be made with improved working conditions,
including wage raises, the sense of a labor shortage has become even stronger since there is competition with newlyopened stores, etc.
○ Private consumption remains flat.（ ）At department stores and supermarkets, although sales of clothing, etc.
show the weather effects, sales of food and beverages remain steady mainly due to a rise in market prices. As for
consumer attitudes, although the willingness to buy products is steady among the wealthy, etc., general customers in
the volume zone segment continue to show steady attitudes of buying only items that they really need, resulting in
further advancement of a stark polarization in consumption. In addition, sales of home appliances show good
performance in premium items, while effects of the consumption tax hike remain in sales of automobiles and houses.
Comments from companies
- The general-purpose and production machinery industries have an attitude of local production for local consumption, and invest if there is domestic demand.
However, Japan is not currently in the volume zone segment. (Large manufacturer/Toyama Prefecture)
- Postponement of a further hike in the consumption tax leads to focusing on opening stores and improving and repairing equipment for the time being.
(Supermarket/Ishikawa Prefecture)
- Sales of home appliances show further advancement of a stark polarization in prices, showing strong performance in items at a high unit price (premium
items) among cleaners, rice cookers, etc. (Home appliance supplier/Ishikawa Prefecture)
Region
Kinki
General
economic
conditions
Showing
some pause
while
showing signs
of
improvement
（→）
Description of sector-specific conditions (major comments)
○ Production remains flat. (→) Although production in industries such as electronic parts and automobile parts
for North America and other regions overseas remains steady, a reactionary decline after the last-minute increased
demand preceding the consumption tax hike continues to be seen in the home appliances and housewares industries,
remaining flat for production as a whole. As for prospects in industries such as electronic and automobile parts for
overseas, some respondents pointed out that steady situations would continue, while there are also concerns about a
growth in inventory.
○ Business investment is picking up. (→) Business investment is picking up in all industries, and many
companies make investment according to original plans. Investment for setting up and adding plants aiming at local
production for local consumption overseas continue to be made centered on large manufacturers, while domestic
investment for new businesses and production capacity enhancement is also observed. In small- and medium-sized
manufacturers, renewal of aging equipment, energy saving and productivity improvement measures through
automation, and efforts for new businesses are observed. In non-manufacturing industries, investment for opening
new stores, remodeling stores, developing logistics facilities, etc. toward attracting foreign visitors to Japan and new
customers is observed.
○ The employment situation is moderately improving, continuing to face a labor shortage. (→) Although
some companies are able to secure an appropriate number of employees, situations of a labor shortage continue
centered on service industries. Global human resources for overseas business and new business development as well
as fully-qualified personnel and engineers continue to be insufficient, showing movement of hiring mid-career
employees. On the other hand, movements of hiring new employees come to be seen among large companies.
○ Private consumption is picking up although there are some weak movements. (→) Consumption of daily
consumable goods, etc. has recovered to the previous level, but variability stands out among differences such as
purchase items, purchaser segments, suburbs and urban areas. Although sales at department stores and supermarkets
as a whole are recovering, driven mainly by food, beverages, and luxury goods, a recovery of volume zone
segments is delayed. Moreover, sales of mini cars remain at a high level, but sales of home appliances and other
consumer durables fail to achieve a full-scale recovery. Domestic trips are relatively steady, and new leisure
facilities also remain brisk.
Comments from companies
- We will concurrently open new stores and remodel stores to enhance our structure in the course of growth in sales and profits caused by willingness of foreign tourists to
buy products in Japan, and thereby prepare for losing those effects. (Large retailer/Osaka Prefecture)
- We lack solar-related engineers and human resources for global development. (Small- and medium-sized manufacture/Osaka Prefecture)
- In October, sales of fresh food were not so bad by item, but sales of housing-related items and clothing fell below the level of the same month in the previous year. (Large
retailer/Wakayama Prefecture)
Region
General
economic
conditions
Showing
signs of a
pause in
Chugoku picking up
（ ）
Comments from companies
Description of sector-specific conditions (major comments)
○ Production is in a weaker state.（ ）Production in the steel industry has decreased slightly with a reduction in
domestic demand for building materials and shipbuilding caused by a delay in construction schedules due to a labor
shortage. Production in the chemical industry has decreased slightly with periodic plant repairs despite continuous
production commensurate with domestic demand. Production in the automobile industry has decreased slightly with
production adjustment for types of cars facing minor model changes amid a lasting reactionary decline after the lastminute increased demand preceding the consumption tax hike. Production in the general-purpose, production, and
business oriented machinery industries has decreased slightly with a decline in demand for farm equipment,
construction machinery, etc. despite steady demand for production equipment.
○ Business investment is picking up. (→) In manufacturing industries, in addition to investment for capacity
enhancement including setting up new equipment, maintenance and renewal, there is also a positive trend toward
increased orders received and response to new products. In non-manufacturing industries, although there has been a
reactionary decline after large-scale store openings in the retail industry in the previous year, continuing investment in
improving management efficiency is seen.
○ The employment situation is improving, with a sense of labor shortage continuing in a wide range of
industries. （
） There is a shortage of employees in production and technical fields due to an increase in production
and orders received in the manufacturing and construction industries, and there is also a shortage of employees in the
sales field associated with opening new stores in the retail industry. A sense of a labor shortage including lacking
necessary human resources continues in a wide range of industries.
○ Private consumption remains flat although there are some weak movements. (→) In addition to continuing
brisk sales of imported watches and cosmetics, the year-end gift sales were also strong. On the other hand, sales of
renovation-related goods, air conditioners, and other goods for which last-minute demand accompanying the
consumption tax hike had been seen in the previous year were sluggish. Automobile sales decreased partly due to a
reaction to the last-minute increased demand preceding the consumption tax hike despite positive effects of the
introduction of new car models.
- Production of construction-related items decreased slightly due to a delay in design and construction due to a labor shortage. (Large manufacturer/Hiroshima Prefecture)
- A recovery of domestic automobile sales after the consumption tax hike is unfavorable. Although the effects of introducing new car models from early autumn can be seen,
exports that had been brisk are decreasing as full-scale overseas operations get underway. Thus, the number of cars produced in Japan will be expected to remain flat or
decrease slightly. (Association/Hiroshima Prefecture)
- We are facing a manpower shortage at general management departments due to business expansion. In addition, we also lack field workers in accordance with a rise in the
rate of production. As for general office workers, we continue to fill them by hiring mid-career employees, etc. (Large manufacturer/Hiroshima Prefecture)
- It is difficult for us to take new orders due to a shortage of employees. (Constructor/Shimane Prefecture)
- We expect to face a severe situation until next March. We face uncertainties as to how much we can recover after April or whether we can recover smoothly. (Large
department store/Hiroshima Prefecture)
Region
Shikoku
General
economic
conditions
Showing weak
movements
while
remaining on
an improving
trend
（→）
Description of sector-specific conditions (major comments)
○ Production shows some signs of picking up while remaining almost flat. （ ）In the food, steel, and electrical
machinery industries, production mostly remains at a high level. Production shows signs of picking up with brisk
orders in the ceramics, stone and clay, general-purpose and production machinery, and transport equipment
(shipbuilding) industries, due to an increasing overseas competitiveness caused by the yen’s depreciation and
domestic construction demand. Production in the textiles, chemical, petroleum and coal products, plastic products,
nonferrous metal, and metal products industries remains almost flat. Production in the pulp, paper, and paperprocessed products industries shows some weak movements. As for projections, although improvement of the
export environment, etc. are expected due to the yen’s depreciation, there are concerns about a rise in raw material
prices, etc. showing a sense of uncertainty.
○ Business investment shows some signs of picking up. (→) Business investment shows limited movements
focusing on the maintenance and renewal of equipment partly due to uncertainties about the future. Amid this
situation, active investment is seen in response to a production increase and new orders received, and for R&D and
new store openings in some industries, including the textiles, plastic products, transport equipment (shipbuilding),
retail, and electric work industries.
○ The employment situation is improving. (→) While the employment situation is improving in the majority of
companies indicating that they have an appropriate number of employees, a wide range of industries, including the
general-purpose and production machinery, electrical machinery, transport equipment (shipbuilding), retail, services,
and electric work industries, indicate that they have an insufficient or a slightly insufficient number of employees
and continue to have a sense of a labor shortage. As for future movement, many industries and companies intend to
increase the number of employees, continuing to show enhanced willingness of companies to hire employees.
○ Private consumption shows some signs of picking up amid weak movements (→) Sales at department stores
and supermarkets show signs of moderately picking up. Sales at convenience stores remain steady mainly due to a
continuous increase in the number of stores. On the other hand, automobile sales show weak movements with the
remaining reaction of the last-minute increased demand preceding the consumption tax hike, and the sales of home
appliances remain sluggish partly due to the weather effects. Service consumption (travel) shows weak movements.
Comments from companies
- In addition to an increasing overseas competitiveness caused by the yen’s depreciation, orders received for domestic construction-related products are increasing, resulting
in full-scale production. We made equipment renewals to increase production. (Large manufacturer/Kagawa Prefecture)
- A rise in raw material prices of pulp, chemicals, etc. and LNG prices due to the yen’s depreciation is weighing on our earnings. (Small- and medium-sized
manufacturer/Ehime Prefecture)
- A drastic increase in capital enables flexible business investment and enhances our credibility, leading to securing excellent human resources. (Large manufacturer/Ehime
Prefecture)
- Although product lines with high added-value, suited to individual tastes are selling well, a sense of concerns about the future, including the future of the economy still
persists, and budget-minded attitudes are expected to continue. (Large retailer/Ehime Prefecture)
Region
General
economic
conditions
Showing
signs of
picking up
Kyushu
（ ）
Description of sector-specific conditions (major comments)
○ Production shows signs of picking up.（ ）In the transport equipment industry, the automobile industry continues to face severe situations due
to low domestic demand, while overseas demand is brisk for some types of cars with remaining effects of moving production operation overseas, and
production in the shipbuilding industry remains steady. In the electronic parts and devices industry, demand for smartphones for overseas and for
automobiles remains brisk. In the production machinery and electrical machinery industries, demand is recovering in export-related companies in
Japan, and demand for semiconductor-related industries is brisk in China and Southeast Asia. The basic materials-related industries including
chemicals show brisk movements in some sectors such as electronic materials, but face severe situations mainly due to stagnant demand and soaring
raw materials costs. In the food industry, high-value-added products maintain their brisk demand in accordance with consumers seeking safe and
secure products.
○ Business investment is picking up. (→) In manufacturing industries, an increase in business investment aiming at cost reduction, production of
new products, etc. can be observed in core industries including the transport equipment, electronic parts and devices, and electrical machinery
industries. In addition, some manufacturers are proceeding with mergers and acquisitions toward expansion into new business fields. On the other
hand, small- and medium-sized enterprises show cautious attitudes due to the lack of improvement in profit margins, and some of them have
decreased their investment amounts with disappointing demand. In non-manufacturing industries, active investment in order to meet consumer needs
and in the energy fields can be seen, while some companies opened less stores than they initially planned due to an increase in construction costs.
○ The employment situation is improving.（ ） Manufacturers are eager to secure human resources to replace retired workers, increase
production, as well as deal with a shortage of human resources with expertise, while some manufacturers face severe situations in which the number
of applicants is insufficient to meet the number of offers with the rising effective ratio of job offers to applicants. In non-manufacturing industries, a
labor shortage can be seen in a wide range of industries, with the response of shortening business hours, increasing overtime work, raising basic
wages, expanding conversion of employees from non-regular employees to regular employees, etc. Although the employment situation as a whole is
improving in this way, the sense of a labor shortage is stronger among companies, and some companies consider the securing of human resources to
be the largest business challenge.
○ Private consumption shows a slowdown in recovery trend.（ ）New products that boost consumers’ willingness to buy items such as safe,
secure and health-conscious food are brisk, while the frugal attitude of customers is intensified for daily necessities, etc., resulting in further
advancement of a stark polarization in consumption. Moreover, some respondents pointed out that rural economies lack strength relative to the
economic recovery in urban areas. A recovery in sales of home appliances and automobiles is delayed. As for sales of houses, demand for
condominiums in good locations is high, amid the effects of the problem of suspending electricity utility companies’ responses to applications for
connecting renewable energy power generation facilities and the continuous sluggish demand for single-family houses. Sales in travel and leisurerelated sectors show steady domestic demand, while overseas demand is sluggish mainly due to the yen’s depreciation. In addition, there are many
concerns about a prolonged decline in consumer confidence due to the effects of the consumption tax hike.
Comments from companies
- Business investment at export-related companies in Japan is intensified due to continuous yen depreciation. Smart phone-related companies in China have a strong willingness to invest and drive demand. (Large
manufacturer/Fukuoka Prefecture)
- Although we have received orders of products for automobiles, we still have low profit margins and not enough money to run the business. Thus, we have a policy reducing business investment as much as
possible. (Small- and medium-sized manufacturer/Oita Prefecture)
- Our biggest business challenge is securing human resources. To prevent employees from resigning, we gave a basic wage raise to all employees and expanded conversion of employees from non-regular
employees to regular employees. (Large logistics operator/Saga Prefecture)
- There are fewer wealthy people in rural areas compared with urban areas, and low- to middle-income consumers are sensitive to prices, resulting in a slight downward trend in the number of customers. (Large
retailer/Kagoshima Prefecture)
Region
Okinawa
General
economic
conditions
Description of sector-specific conditions (major comments)
Improving
（→）
○ Production remains flat. (→) Production in the food industry remains flat, supported by sales for New Year’s holidays
and year-end gifts despite calm travel demand. Production of the ceramic, stone, and clay products remains steady, with the
expectation of demand from public works, etc. Although the effects of soaring raw material costs are still observed, some
respondents pointed out that the effects reduced due to a decline in fuel costs, and that an upward trend of production of
building materials is expected to continue since movements can be seen in construction-related products whose progress was
delayed due to a labor shortage. On the other hand, some respondents also pointed out that they reduced production due to
carrying inventory.
○ Business investment remains flat. (→) In manufacturing industries, investment were made for setting up manufacturing
lines, introducing energy saving equipment, and adding and remodeling plants and facilities. In non-manufacturing industries,
investment other than maintenance and renewal of equipment was made such as expanding, setting up, and remodeling
facilities and stores. On the other hand, there were some companies reducing investment due to a decline in profits.
○ The employment situation shows signs of improvement. (→) Although it remains severe when compared with the
national ratio, the effective ratio of job offers to applicants remains steady, marking the record high for the sixth consecutive
month since the peak in 1972. There are also some companies that hired more employees than usual, converted contracted
employees to regular employees, or raised wages. On the other hand, some respondents pointed out that the number of
applicants is insufficient to meet the number of offers for non-regular employees, and it was difficult to hire mid-career
employees. There is still a sense of an insufficient number of both regular and non-regular employees.
○ Private consumption shows signs of improvement. (→) The sales trend at department stores and supermarkets remained
steady, exceeding the level of the same month in the previous year. Some respondents pointed out that sales increased with an
increase in per-customer spending and the number of items purchased, despite the effects of the typhoon. On the other hand,
some respondents also pointed out that the number of customers remained unchanged, but per-customer spending and the
number of items purchased decreased. Although the peak season of travel has ended, the number of tourists remains steady,
due mainly to the yen’s depreciation and the geographical advantage of Okinawa, in addition to the effects of attracting
customers due to the expansion of routes of low-cost carriers and the opening of New Ishigaki Airport. As for the number of
tourists from overseas, the accumulated total as of October exceeds the results in the previous year due to the brisk number of
tourists from Taiwan, the Republic of Korea, Hong Kong, China, etc., remaining steady and exceeding the level of the same
month in the previous year for the 26th consecutive month since October 2012. Some respondents pointed out that repeat
tourists with purchasing power seem to be increasing.
Comments from companies
- Summer is the season in which demand for beverages, our leading products, is growing, thus demand in the current period normally declines compared with the
previous period, but it is remaining steady this year. (Small- and medium-sized manufacturer)
- Movements can be seen in construction-related products whose progress was delayed due to a labor shortage. We expect that an upward trend in production of
building materials will continue. (Small- and medium-sized manufacturer)
- We raised wages by 5% to secure part-time store staff. We are considering a further rise in wages in the next period. We introduced a supplemental payment system
for part-time store staff working on the weekends to stabilize the working shifts. (Large retailer)