Research and Studies

Home > Research and Studies > BOJ Reports & Research Papers > Regional Economic Report > Regional Economic Report (Summary) (July 2010)

Regional Economic Report (Summary) (July 2010) *

  • This report summarizes the reports from all regional research divisions, mainly at the Bank's branches in Japan, and is based on data and other information gathered for the Bank of Japan's branch managers' meeting held today. The English translation is based on the Japanese original.

July 8, 2010
Bank of Japan

Eight regions (Hokkaido, Tohoku, Hokuriku, Kanto-Koshinetsu, Kinki, Chugoku, Shikoku, and Kyushu-Okinawa) judged that, compared with the assessment in April 2010, their economic conditions had improved further. Four regions (Kanto-Koshinetsu, Kinki, Chugoku, and Kyushu-Okinawa) viewed their economies as recovering at a moderate pace.

Many regions reported that, amid the continued increase in production, business fixed investment had either stopped decreasing or had started picking up and the degree of severity in the employment and income situation had eased. Most regions reported that private consumption had either stopped decreasing or had started picking up.

Meanwhile, many regions pointed either to the continued low level of economic activity (Hokkaido, Hokuriku, Kinki, and Shikoku) or to differences in developments among regions, industries, or firms (Kanto-Koshinetsu and Kyushu-Okinawa).

Table : Regional Economic Report (Summary) (July 2010)
Region Assessment in April 2010 Difference
between
assessments 1
Assessment in July 2010
Hokkaido The economy is increasingly showing signs of picking up, although it remains stagnant. upper right The economy is picking up steadily, although economic conditions as a whole remain severe.
Tohoku The economy is increasingly showing signs of picking up, although economic conditions as a whole remain severe. upper right The economy is increasingly showing signs of picking up.
Hokuriku The economy is picking up moderately, although economic conditions as a whole remain severe. upper right The economy is picking up steadily, although there remains some severity in economic conditions.
Kanto-Koshinetsu The economy has continued picking up, although differences among regions and industries remain. upper right The economy is recovering moderately, although differences among regions and industries remain.
Tokai The economy has continued picking up, and differences among industries and firms have been moderating gradually. unchanged The economy has continued picking up as a whole, as the pace of increase in production has started to accelerate again after slowing temporarily.
Kinki The economy, with some severity in employment, is picking up steadily. upper right The economy, with some severity in employment, is recovering moderately.
Chugoku The economy is picking up. upper right The economy is recovering moderately.
Shikoku Economic conditions have remained more or less unchanged as a whole, although there are some signs of picking up. upper right The economy is picking up moderately, although economic conditions as a whole remain severe.
Kyushu-Okinawa The economy has picked up moderately as a whole, although differences among regions remain. upper right The economy is recovering moderately, although differences among regions remain.
  1. With regard to the difference between assessments, arrows pointing to the upper right and lower right indicate changes in the pace of improvement or deterioration compared with the previous assessments, respectively. For example, an acceleration in the pace of improvement or deceleration in the pace of deterioration is indicated with an arrow pointing to the upper right. A horizontal arrow pointing to the right indicates that the pace of improvement or deterioration in economic conditions has remained unchanged compared with the previous assessments.

Public investment either decreased or was on a declining trend in seven regions (Hokkaido, Tohoku, Hokuriku, Kanto-Koshinetsu, Tokai, Chugoku, and Kyushu-Okinawa).  As for the other two regions, Shikoku reported that public investment had leveled off, while Kinki reported that the pace of increase had slowed.

As for business fixed investment , four regions (Hokkaido, Tokai, Kinki, and Kyushu-Okinawa) noted that it was picking up, had begun to pick up, or that it had increased although remaining at a low level. Four regions (Hokuriku, Kanto-Koshinetsu, Chugoku, and Shikoku) reported that business fixed investment had stopped declining. Meanwhile, Tohoku reported a decline, but indicated that the pace of decline had moderated.

By industry, business fixed investment in manufacturing continued to be concentrated in maintenance and replacement investments, and in investments to expand production capacity.  A further increase in investment plans for new products and research and development was also reported.  As for nonmanufacturing, regions continued to report large-scale investments in infrastructure-related sub-industries, and several regions reported opening of new stores in retailing.

Five regions (Hokkaido, Hokuriku, Kanto-Koshinetsu, Tokai, and Chugoku) reported that private consumption as a whole was picking up, showing signs of picking up or the decline had been coming to a halt, because the degree of severity in the employment and income situation had eased somewhat and because policy effects had continued.  Meanwhile, private consumption as a whole remained weak in four regions (Tohoku, Kinki, Shikoku, and Kyushu-Okinawa).

By goods, all regions continued to report an increase in sales of household electrical appliances and passenger cars due to policy effects.  As for sales at large retail stores such as department stores, six regions (Hokkaido, Tohoku, Kanto-Koshinetsu, Tokai, Chugoku, and Kyushu-Okinawa) reported that the year-on-year rate of decline had moderated, even though sales as a whole remained subdued.  Also, seven regions (Hokkaido, Tohoku, Hokuriku, Kanto-Koshinetsu, Tokai, Shikoku, and Kyushu-Okinawa) noted that travel-related demand had either increased or stopped decreasing.

As for housing investment , Hokkaido noted that it was picking up, while Tokai noted that it had shown signs of picking up.  In addition, five regions (Hokuriku, Kanto-Koshinetsu, Kinki, Chugoku, and Kyushu-Okinawa) reported that housing investment had either stopped declining or had been coming to a halt.  Many regions, however, pointed out that the level of housing investment remained low.

By type of housing, several regions reported that construction of owned homes was above the previous year's level, and some regions (Kanto-Koshinetsu and Tokai) that include metropolitan areas reported that sales of homes, notably of condominiums, had either picked up or had started to exceed the previous year's level.

Production either increased or picked up in all regions.  Meanwhile, four regions (Tohoku, Hokuriku, Chugoku, and Shikoku) reported that the pace of increase in production had accelerated mainly due to the improvement in overseas economic conditions.  On the other hand, Hokkaido and Tokai noted that the pace of increase in production had slowed temporarily, mainly due to developments in automobile-related industries.

By industry, some regions reported that the pace of increase in production had slowed temporarily in motor vehicles and motor vehicle parts, while many regions reported that production levels had either increased or had remained high in general machinery as well as electronic parts and devices.  As for industries such as iron and steel, nonferrous metals, chemicals, and metal products, many regions reported production increases, high production levels, or a pick-up in production.  Meanwhile, some regions reported that production cuts or low production levels had continued in paper and pulp and in textiles.

The employment and income situation remained severe, but many regions reported that the degree of severity had shown signs of easing.

As for the employment situation, three regions (Hokuriku, Kanto-Koshinetsu, and Tokai) reported that labor market conditions had improved moderately, and Chugoku reported an increase in new job offers to new applicants in some industries.  As for household income, three regions (Tohoku, Kanto-Koshinetsu, and Shikoku) reported that it was reaching a bottom.

Table : Regional Economic Report (Summary) (July 2010)
Region Public investment Business fixed
investment
Private
consumption
Housing
investment
Production Employment and income
Hokkaido Declining. Increasing, although remaining at a low level. Continues to show signs of picking up, mainly due to policy effects. Picking up. The pace of pick-up is slowing. The employment situation is showing signs of improvement, although it continues to be severe. 
Household income is showing signs of improvement mainly due to the uptrend in overtime hours worked, although it remains severe amid continued cutbacks in personnel expenses among firms.
Tohoku Below the previous year's level. Declining. Continues to be weak as a whole, although policy effects have been apparent and sales of some products and services that appear reasonably priced have started to show signs of improvement. Remains sluggish, although showing signs of bottoming out in some types of housing. Recovering moderately. The employment situation is showing signs of improvement.
Household income has exceeded the previous year's level for the first time in 23 months.
Hokuriku Declining as a whole, mainly because large-scale construction orders related to the Hokuriku bullet train have come to a halt. Has stopped declining, especially in manufacturing. Although at a weak level, the decrease in private consumption has been coming to a halt due to policy effects. The decline, especially in the construction of owned homes, has been coming to a halt. Increasing across a wider range of industries, mainly due to the further rise in exports, especially to Asian countries such as China. The employment situation remains severe, but labor market conditions have continued to show signs of a moderate improvement.
Household income continues to be severe as a whole since scheduled cash earnings have remained below the previous year's level, despite the continued increase in non-scheduled cash earnings, especially in manufacturing.
Kanto-Koshinetsu On a declining trend, although recently it has been more or less unchanged due to large-scale construction orders, mainly by the central government. Has stopped declining. With the slight easing in the degree of severity in the employment and income situation, there have been increasing signs of a pick-up such as (1) the continued improvement in sales of durable goods due to policy measures; (2) the moderation in the decrease in sales at large retail stores; and (3) the continued improvement in hotel occupancy rates. Starting to show signs of picking up in some areas such as homes for sale in the Tokyo metropolitan area, while the decline in construction of owned homes and homes for rent has been coming to a halt. Continues to increase, mainly due to the improvement in overseas economic conditions. The employment situation continues to be severe, but labor market conditions have been on a moderate improving trend.
Household income has continued to decline, although it is beginning to reach a bottom.
Tokai On a declining trend, but recently at a high level reflecting an upsurge in large-scale construction orders. Has begun to pick up, although remaining at a low level. Picking up as a whole: while sales of durable goods such as automobiles have remained at a high level, sales of non-durable goods and services have begun to increase, although the level remains low. Showing signs of picking up in some types of housing, although remaining at a low level. Has recently been regaining momentum, following a temporary slowdown mainly due to inventory adjustments in automobiles. Labor market conditions have improved, although the employment and income situation as a whole remains severe.
Kinki The pace of increase is slowing. Has begun to pick up amid continued improvement in corporate profits. Sales of durable goods have picked up due to policy effects, while sales of other goods and services have remained weak amid continued sluggishness in household income. The decline has been coming to a halt, although housing investment remains at a low level. Increasing, reflecting the rise in exports and policy measures to promote sales of energy-efficient household electrical appliances.  Meanwhile, inventories have continued to decrease. As for the employment situation, the number of employees has continued to be below the previous year's level and wages have continued to be weak, while the ratio of job offers to applicants remains at a low level. 
Household income has continued to be sluggish.
Chugoku Declining. Has stopped declining. Showing signs of picking up, mainly with regard to sales of durable goods due to policy effects. The decline has been coming to a halt. Increasing. The employment situation has remained severe, but it has improved slightly as new jobs have been offered particularly in some manufacturing industries.
Non-scheduled cash earnings have increased due to the pick-up in production, although household income as a whole continues to be weak, mainly reflecting firms' cutbacks in personnel expenses.
Shikoku Has peaked out. Has stopped declining. Continues to be relatively weak as a whole amid the severe employment and income situation, although sales of durable goods have remained at a high level due to policy effects. More or less unchanged at a low level. Picking up moderately as a whole. The employment situation remains severe, but the degree of severity has eased slightly.
Household income has more or less stopped declining.
Kyushu-Okinawa Declining. Picking up. Some areas have shown signs of picking up, although it remains weak as a whole. Has stopped declining. Increasing steadily, albeit moderately. The employment and household income situation has remained severe as a whole, but signs of a slight improvement have been seen.

Appendix: Prefectures Included in Each Region

Table : Appendix: Prefectures Included in Each Region
Region Prefectures
(a) Hokkaido Hokkaido
(b) Tohoku Aomori, Iwate, Miyagi, Akita, Yamagata, and Fukushima
(c) Hokuriku Toyama, Ishikawa, and Fukui
(d) Kanto-Koshinetsu Ibaraki, Tochigi, Gunma, Saitama, Chiba, Tokyo, Kanagawa, Niigata, Yamanashi, and Nagano
(e) Tokai Gifu, Shizuoka, Aichi, and Mie
(f) Kinki Shiga, Kyoto, Osaka, Hyogo, Nara, and Wakayama
(g) Chugoku Tottori, Shimane, Okayama, Hiroshima, and Yamaguchi
(h) Shikoku Tokushima, Kagawa, Ehime, and Kochi
(i) Kyushu-Okinawa Fukuoka, Saga, Nagasaki, Kumamoto, Oita, Miyazaki, Kagoshima, and Okinawa

Notice

Please contact below in advance to request permission when reproducing or copying the content of this report for commercial purposes.

Please credit the source when reproducing or copying the content of this report.

Inquiries

Regional Economy, Research and Statistics Department

Tel : +81-3-3277-2649