Business

Consumer sentiment at highest level since 1991

Reading shows that export-led recovery is being noticed by public, says Cabinet Office

Consumer sentiment in Japan hit its highest level in 12 years and eight months in May, showing that the export-led economic recovery is being noticed by consumers, according to a government survey released Friday.

The Cabinet Office said the unadjusted consumer confidence index for households nationwide, excluding single-person households, rose 2.9 points from April to 48.3, marking the highest reading since it reached 48.5 in September 1991.

The index is calculated by assigning points on the basis of whether consumers believe their sentiment in the four categories of employment, overall livelihood, income growth and inclination to purchase durable goods will, in the coming six months, improve, improve somewhat, remain unchanged, deteriorate somewhat or deteriorate.

Regarding expectations for prices over the next year, 48.7 percent of all surveyed households, including single-person households, said they believe prices will remain unchanged, up from 38 percent in April. A total 36.2 percent expect a rise in prices, compared with 44.2 percent the previous month.

The result suggests consumers might not necessarily feel price increases are at hand, despite the recent uptrend in the economy.

The ratio of households who said they expect prices to fall was effectively unchanged at 10 percent, compared with 10.2 percent in April, the report said.

The survey was conducted by the Cabinet Office on May 15 on 6,719 households.

Spending money down

The average monthly spending money for male Japanese salaried workers has fallen to the lowest level in 22 years, according to a recent survey conducted by GE Consumer Finance Co.

The poll, conducted between late April and mid-May, showed the average monthly amount fell 4,400 yen from last year to 38,300 yen, sinking below 40,000 yen for the first time since 1982. The Internet poll covered 500 male workers nationwide.

The survey results suggest that Japanese workers are still suffering the effects of the deflationary state of the economy, despite recent signs of an economic rebound, company officials said.

The amount of spending money the average salaried worker has every month is traditionally decided by his wife, or whoever else oversees household and family expenditures, after he has handed over his monthly pay.

Asked how much was an ideal monthly allowance, the amounts cited by the wage earners averaged 62,000 yen, 23,700 yen more than the average of what they were actually given. A total of 66.2 percent of the respondents said the state of their spending money is either “rather constrained” or “very constrained.”

More than 30 percent of the wage earners in their 40s — the age bracket in which family budgets are under pressure from children’s educational expenses — said the state of their allowance is “very constrained.”

Asked how much they spend on lunch, an expense taking a large portion of the allowance, the poll found that workers spend an average of 650 yen, down 20 yen from last year.

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