business

Japan's household spending drops at record pace as virus hits economy

33 Comments
By Daniel Leussink

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© Thomson Reuters 2020.

©2020 GPlusMedia Inc.

33 Comments
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Can't spend it you don't have it. Tax time is probably a bigger hit than any virus.

14 ( +14 / -0 )

Perhaps, just perhaps, it has more to do with household earnings dropping.

17 ( +17 / -0 )

Didn't knew the virus also infected everyone's wallets.

I was under the impression that this had a lot more to do with the extreme measures taken, the government, and just the constant fear mongering.

But the article states as if the virus itself was the culprit, so now I know that SARS-CoV-2 not gives you Influensa-like symptoms, but also economic depression symptoms.

-13 ( +7 / -20 )

Didn't the goverment promise 100.000 Yen to every citizen to tackle the economic repercussions? None of my co-workers have received that money, yet. I got the papers in the beginning of June, applied a couple of days later and still no transaction. Thank god, I am doing fine, but for people in financial need, that is unacceptable.

21 ( +21 / -0 )

maybe if they stopped raising prices and raising taxes people would buy more? Just sayin'

18 ( +19 / -1 )

This article is relevant.

https://www.cnbc.com/2020/07/03/japans-middle-class-is-disappearing-as-poverty-rises-warns-economist.html

6 ( +6 / -0 )

I always wonder why people haven't received those "Abe-Yen" yet.

Once we got the paperwork it was a piece of cake, received the money within a couple of days!

But maybe folks living in "inaka" are more lucky than the ones living in bigger cities?

5 ( +7 / -2 )

Yes, spending drops because people don’t have money not because of a virus.

Wages are down and part time poorly paid work is up.

Money is being sucked from the poor at the expense of large government cash injections into private zombie companies!

Does Daniel live in Japan?

12 ( +12 / -0 )

Ordering people to stay home for a month will do that, ya dummies in gubermint! Now that MANY people are underemployed (or out of work altogether), on drastically reduced incomes, what is to be expected? Regular folks can't print money like the gubermint does willy-nilly.

2 ( +6 / -4 )

@mable - currently ward offices are unable to process the applications - not enough staff. They are even advertising for part-timers to help. Expect it in a few more weeks.

2 ( +2 / -0 )

The promised ¥100,000 is a local body issue, they need to do their complicated hand stamping process to justify their jobs. Like many others I am still waiting as is my wife and adult children. Business have closed over a number of sectors, yet the government has spent how much on stupid tiny masks? Over 100 million dollars on a missile defences system that NOW is cancelled, people sleeping in a school gymnasium. When they should be in a hotel that's empty? Households just don't have the money to spend unlike overpaid usless politians who seem to assume everyone gets a ¥3.000,000 a month salery. Such slimey vile disgusting human beings. They make me vomit.

14 ( +14 / -0 )

A one-off 100,00 yen will not, on average, come close to the loss of annual income. And it sounds like some people here haven't even got that yet. So it should be no surprise spending is dropping. Abe and co need to focus on consumers and not on business confidence.

10 ( +10 / -0 )

"The impact from the coronavirus led to a reduction in overtime pay which caused real wages to fall a lot," a labor ministry official told Reuters.

Overtime pay, a barometer of strength in corporate activity, saw its biggest decline since comparable data became available in January 2013, slumping 25.8% in May from a year earlier, down for a nine straight month.

So that's why everyone "works" way past quitting time. They're in it for the overtime since their normal salaries are abysmal. Maybe if businesses paid their employees more and restructured to be more productive with less overtime, their workers would be happy and thus fuel the economy by spending and traveling with the free time they'd get.

8 ( +8 / -0 )

Some of this will definitely be the delay in getting the 100,000 out there. It wrecks confidence and that means further tightening of belts in a vicious circle.

It is possible or even likely that a second or further round of stimulus will be likely, but of course we can't say that because lots of people haven't even got round one yet.

I've already spent half of my family's money on fitting air conditioning to two upstairs rooms.

3 ( +3 / -0 )

I always wonder why people haven't received those "Abe-Yen" yet.

But maybe folks living in "inaka" are more lucky than the ones living in bigger cities?

I don’t understand why some haven’t received it either. Doesn’t seem to have anything to do with being in the country though. I live in Yokohama, received the papers a few weeks ago, applied right away and the money was in the bank at the end of the same week.

1 ( +1 / -0 )

The constant 2 wave talk hardly inspires people too spend their 100,000 yen.

4 ( +5 / -1 )

If only I got the bloody Abe poketto money of 100k, then perhaps I would have spent a tiny bit more... But still no sign of the money on my account...

8 ( +8 / -0 )

Not surprised at all. My family is eating at home every meal, going nowhere during the day or for holidays. The only thing to spend money on really is Amazon deliveries.

10 ( +10 / -0 )

Got the money haven't spent it on anything yet. Keeping it for a rainy day, one never knows what could happen next

7 ( +7 / -0 )

This page shows what percent of residents by wards, received their stimulus. Adachi-ku seems to be doing a dang good job. Shows 97% of residents already received the stimulus.

https://new-next-life.com/archives/193

3 ( +3 / -0 )

The ministry defines "workers" as 1) those who were employed for more than one month at a company that employed more than five people, or 2) those who were employed on a daily basis or had less than a one-month contract but had worked more than 18 days during the two months before the survey was conducted, at a company that employs more than five people.

What a joke. I work 4hrs a day mon to Fri at 900yen/hr that works out at

80hrs a month pay before taxes 72,000yen/month and I am called a worker. This makes Kim's North look like an utopia.

11 ( +11 / -0 )

Since January our monthly expenditure has increased due to my hospital visits and operation. Since Covid19 we haven’t been to a restaurant or bar or any indoor eating place. We haven’t earned any money this year so it’s pensions and savings. Abe money was good for us. Two months living on top of pension money.

I need to sell my paintings soon and a return to our home students. Trying to go online with that.

5 ( +5 / -0 )

What a joke. I work 4hrs a day mon to Fri at 900yen/hr that works out at 0hrs a month pay before taxes 72,000yen/month and I am called a worker.

Damn. Did you drop out of high school or something? That is a shockingly low wage for a dr.

2 ( +4 / -2 )

Well I'm waiting at the postbox (virtual) every morning and am yet to have a sniff of Abe's money. Thankfully I am ok however it must be awful for people who were already living paycheck to paycheck. How long before they cut the tax rate?

2 ( +2 / -0 )

Doctors earn ¥12-¥24 million pa and work six days a week. They takes turns for call out duty.

2 ( +2 / -0 )

Also here in very central Tokyo no sign of the 100,000, ward office says another 3-4 weeks as nobody knows.

1 ( +1 / -0 )

Reckless.

Damn. Did you drop out of high school or something? That is a shockingly low wage for a dr.

Yes shocking, but that is the reality for some so called workers here especially housewifes, those above 60. From outside and to some who are inside Japan glitters but it is not gold not even bronze.

6 ( +6 / -0 )

So, Mr Abe, where are the taxes going to come from now?

How about hiking the consumption tax to 25% and we'll go back to a barter system!

0 ( +1 / -1 )

I finally got the money after a long time scrimping and saving, all the while!

However, it has gone to repair a leak in the house and on more tubs of natto...

Anyone without the money should pay a trip to their local government office!

1 ( +1 / -0 )

drlucifer how are you surviving in Japan on 4 hrs work a day on ¥900?!

0 ( +0 / -0 )

This parody continue, I forgot my pop corn. Can government just bankrupt so we can finally start over with healthy system again? Instead of giving printed money to people so they can pretend they work at their offices during pandemic when everything is closed.

Just wait.

1 ( +1 / -0 )

On the other hand, stay-home policies boosted spending on pork and beef, alcohol and sanitary goods like face masks.

Great! More chances to get swine flu, BSE, alcoholics and filled-up land-fills.

People need to realize intensive factory farming is no better than wet markets. The cruelty, not to mention the packed conditions perfect for the spread of more disease, the toll on the environment and on people's health.

-1 ( +0 / -1 )

if the Government would just let us have some discount on our road tax a bit it would help....

1 ( +1 / -0 )

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