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Japan’s 2006 household savings rate: Up, for the first time in eight years

February 19, 2007
By Ken Worsley


For the first time in eight years, Japan’s household savings rate increased in 2006. According to a report released by the Ministry of Internal Affairs and Communications, the savings rate at households headed by a salaried worker averaged 27.5% last year, up 2.2 percentage points from 2005.

Of course, as we’ve noted before, 2006 was the first year in eight years where the average wage increased in Japan. They were up 0.1% for the year, according to the Ministry of Health, Labour and Welfare. The Ministry of Internal Affairs and Communications gives slightly different results on household income for 2006:

The average monthly income per household stood at 525,719 yen, up 0.2% in nominal terms but down 0.1% in real terms from the previous year.

Either way, it hurts. With Japan’s bosses still opposed to wage hikes, 2007 could end with a crunch as all those fancy new machines turn out products no one is buying. Is overcapacity on the way?

Filed Under Labor and Wages 

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Comments

4 Responses to “Japan’s 2006 household savings rate: Up, for the first time in eight years”

  1. Hidden Cost Of Hotels - Japan vs US Savings Rates - How To Deal With Car Salesmen - Money Minute Video - SavingAdvice.com Blog on June 14th, 2007 8:07 pm

    […] Japan’s 2006 Household Savings Rate: Up, for the First Time in Eight Years: That headline makes is sound like there is a problem with Japan’s saving rates, but after eight years of savings declines, the Japanese were still socking away over 1/4 (25.3%) of their income, and with the latest increase, are now up to 27.5%. Compare that to the US savings rate which last year was in negative territory (-0.5%)… […]

  2. Japanese Savings Plan | 60 Second Finance on January 21st, 2008 11:56 pm

    […] finances. Take Japan for example, where in 2005 the average Japanese household savings rate was 25.5%. The average Amercian household savings rate was -0.5% in the same year. That’s negative 0.5% […]

  3. The Kakeibo and Japanese household budgeting tools | Eating Right on November 2nd, 2008 4:14 pm

    […] saving rates in Japan are amongst the highest in the developed world, estimated to be around 25% of income (though that has fallen from previous savings rates of 30 to 35%; in contrast, the saving […]

  4. Yokoso Nagoya! » Blog Archive » Happy Holidays Everyone! on December 27th, 2008 7:49 pm

    […] In spite of the impending doom, all the shopping, expensive stores, and consumption in Japan, the approximately 25% savings rate on disposable income is still relatively high. Although it is hard to get a consistent story, and the number varies […]

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