Japan November household spending down 0.5% as spending on services stays in the red

December 27, 2008
By Ken Worsley

According to data released yesterday by the Ministry of Internal Affairs and Communications, Japan’s household spending fell 0.5% in November on a year-on-year basis. November is thus the ninth consecutive month in which household spending has declined.

Average spending at households with two or more persons came to 284,762 yen, down 0.5% from a year ago, while spending at those households with a worker as head of household increased 1.2% to 310,146 yen. Wages at workers’ households fell 0.3% to 439,394 yen.

In terms of spending at households with two or more persons, here’s a breakdown by category:

Transportation & communication: 37,935 yen (+11.0%)
Culture & recreation: 30,290 yen (+4.3%)
Clothing & footwear: 15,547 yen (+1.3%)
Food: 68,510 yen (+0.5%)
Housing: 16,992 yen (+0.1%)

Furniture & Household Goods: 10,136 yen (-1.1%)
Medical care: 13,544 yen (-2.2%)
Fuel, electric and water: 20,302 yen (-4.3%)
Other: 63,002 yen (-7.1%)
Education: 9,506 yen (-8.7%)

In October, only education spending had shown an increase; in November half of the categories increased while half declined, just as they had in September. While transportation, communication and recreation spending contributed most heavily to the increase in household spending, the source of downward pressure on household spending figures is more difficult to pinpoint, as it lies primarily in the vague “other” category.

To get a better look at where the downward pressure on household spending lies, here’s our table tracking the past year of spending on goods and services:

	Goods and Services	Goods Only	Durable & Semi Durable Goods	Services Only
December 2007	+2.34%	+0.99%	+.97%	+4.20%
January 2008	+4.39%	+2.98%	+8.09%	+6.40%
February	+1.30%	+4.76%	-3.65%	-3.28%
March	-0.90%	-0.51%	-10.41%	-1.43%
April	-1.16%	-0.10%	-6.56%	-2.35%
May	-1.94%	+2.68%	+8.26%	-7.64%
June	+1.08%	+1.31%	-1.92%	+0.75%
July	+0.20%	+0.56%	+2.25%	-0.29%
August	+1.01%	+0.03%	+3.01%	-5.87%
September	+1.51%	+1.23%	+1.54%	+1.89%
October	-0.07%	+1.62%	+5.27%	-2.14%
November	+2.11%	+4.58%	+13.31%	-1.14%

In November, spending on goods and services totaled 251,790 yen. Spending on goods was at 146,570 yen, with durables and semi-durables consisting of 41,836 yen of spending on goods. Meanwhile, total spending on services was at 105,220 yen.

When goods and services spending (251,790 yen) is subtracted from the total figure (284,762 yen), we have a leftover 32,972 yen, which does not correspond to any of the categories listed and remains unexplained on the ministry’s excel sheets. There is a figure labeled “miscellaneous” which lists 21,044 in spending above the total household spending figure. At any rate, subtracting spending on goods and services from total household spending in November 2007 leaves us with a gap of 36,260 yen. Thus, while the drop in spending on services may not seem strong enough to put heavy downward pressure on household spending, it appears to be supported by a 9.07% drop in the mysterious “gap” of spending that lies outside of spending on goods and services, yet is still part of household spending - though apparently unspecified in the data.

Filed Under Economic Reports, Household Spending