Hi Blog and Happy Start of Golden Week. I have a new blog poll up on the right-hand side of every blog page, and here’s some background information on the issue. Two Terrie’s Takes, one from last week, one from last year (which is a bit of a time capsule as it’s pre-economic crisis). Enjoy. Debito in Sapporo, who is not traveling.
* * * * * * * * * T E R R I E ‘S T A K E * * * * * * *
A weekly roundup of news & information from Terrie Lloyd.
General Edition Sunday, Apr 26, 2009 Issue No. 515
-> Possible holiday reform
The central government is reportedly looking at modifying
the dates of some public holidays, so as to ensure that
they fall on days that allow 3-day weekends and thus
encourage employees to take time off work and travel with
their families. To ensure that Dads actually do take off
their extra days of leave — which currently they don’t 50%
of the time, the government is also considering changing
accounting rules so that any unused employee leave will
have to be accounted for as a liability, and be financially
provisioned for in company accounts. ***Ed: This is a great
idea, and will certainly make companies more interested in
having their staff actually take time off.** (Source: TT
commentary from nikkei.co.jp, Apr 21, 2009)
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General Edition Sunday, April 27, 2008 Issue No. 467
Here we are at the start of what normally for many is one of their longest holiday breaks — Golden Week (“Renkyu”). But not this year — as neither of the two weeks that the holidays occur in provides workers more than 2 days off. Normally, the 4 days: Showa Day, Constitution Day, Greenery Day, and Children’s Day would generate a string of holidays up to 7 or 8 days long, but because this year two of the days fall on the weekend, we only get a single compensation day on Tuesday, May 6th. Next year is better, we get 5 consecutive days.
This hasn’t deterred a number of traditional companies from going ahead and giving their employees some extra time off — so next week it will be hard to order anything from factories or service companies. We know because we just tried to get a new TV installed. No way Jose, we’ll have to wait until at least May 7th or 8th — ten days from now.
But while some lucky workers are getting a couple of bonus days off, most are not. This is apparently the main reason why the number of tourists expected to travel overseas this Golden Week is likely to fall almost 15% from last year, to 458,000 people. This is the biggest drop since 2003, when SARs scared everyone into staying home. SARs of course is just a faded memory (other than the government which has a stock pile of 35m doses of Tamiflu), and this year, 269,000 people will still make the pilgramage to Hong Kong, South Korea, and/or China.
But it seems that there are other factors besides the scattered nature of the holidays which are keeping the Japanese at home during Golden Week, 2008.
As far as Asia is concerned, the Japanese are a relatively peripatetic nation, with around 17m people making overseas trips and 22m taking domestic holidays in 2007. This is equivalent to 32% of all its citizens taking a holiday away from home at least once a year. Golden Week is a particularly important travel period economically. Destinations like Hawaii receive about 458,000 Japanese tourists a year, and about 1/3 of them travel during Golden Week, spending an average US$269 a day, almost double the US$169 Americans from the mainland spend.
Those who don’t go overseas instead journey to Tokyo and other major centers to shop. Last year 1.5m people visited the then-new Mitsui Midtown shopping/office complex in Roppongi. Department stores such as Daimaru saw shopper numbers rise by around 12%. Taxi company Nihon Kotsu had its fare earnings increase by JPY1,300 per cab, due to customers making round trips to Haneda airport and the city. In Osaka, sales at the Namba Parks entertainment complex soared 170%.
Some of the reasons that JTB, Japan’s largest travel agency, is giving for the international tourist drop-off this year include the higher fuel surcharges, adding up to 10% to ticket prices; the Chinese gyoza food scare; and just the simple lack of holiday budget by families and younger people who have historically flocked to Hawaii and other international destinations.
This last point is in our minds probably the biggest factor affecting travel statistics in general — not just international travel. Although one would think that the 13% revaluation of the yen versus the dollar would make Hawaii and similar dollar-tied destinations a lot more attractive, it seems that the cloud of pessimism which has been hanging over the Japanese economy since the subprime news started breaking last summer, is still very much affecting the moods of both employers and workers alike.
As polls are showing, the average Japanese appears to be very concerned about their overall future — the Cabinet Office’s March consumer confidence poll showed that just 36.5% of households in the period January-March were confident about the future, the lowest level of confidence since June 2003, when it was 36.1%. A reading of less than 50% indicates a general mood of pessimism in the nation. So, perhaps it is natural that people are less likely than ever to want to lay out thousands of dollars on a trip when doing so might create a shortfall in their budget if the prices continue to rise.
And this is not a new trend. Overseas travel has dropped each year over the last two years, and has only just barely retraced the levels of pre-SARs 2002. However, whereas in previous years falling international travel was offset by local visits to onsen and tourist spots around the country, this year JTB is also forecasting a slight drop in domestic tourists, to 21.44m people. Gunma reckons its visitor numbers to onsen this year will be down around 5%.
The feeling of pessimism (or realism?) is nowhere more pronounced than amongst young adults in their 20’s. While in 1996, around 4.63m people in this age group traveled overseas, in 2006, only 2.98m did — a fall of 35.7%. This huge drop can be explained by simple economics. Although the job market is tight, companies are not opening their purse strings to employees — they’re scared too, and thus real income for workers in their 20’s has dropped almost yearly since 2001. Recent inflation is speeding up this deficit. JTB says the average Japanese tourist spends about JPY214,000 on an overseas trip, and that is several thousand dollars more than a worried single is prepared to pay. Indeed, the Statistics Bureau gives the average 2006 disposable income of under-34’s, who have their own apartment as being just barely more than JPY20,000 (US$200) per month — hardly enough to do any travel on.
As a result, not just travel, but other forms of youth spending such as autos and alcohol have also dropped. According to a recent Nikkei article, the Japan Automobile Manufacturers Association says that the ratio of cars owned by young men in their 20s dropped from 81% in 1995 to 74% in 2005. Another survey found that single males 34 years or younger were last year spending 26% less on alcohol then they did in 2002.
So is there a silver lining to a slow golden holiday period? It seems there is. In 2002, the number of people killed in Golden Week accidents was 224, while last year, just five years later, 119 died this way. More notable was the fact that only 12 people died through drunk-driving accidents versus 29 in 2007.
Japan’s youth appear to becoming a generation of worried, sober bicycle and train riders, who stay at home or meet friends during Golden Week…