TDB Trends Research (Research & Summary for August 2020)

Domestic economy showed a slight recovery
trend amid the uncertainty～ Hopes for a recovery in consumer spending,but economy is expected to remain flat ～e-mail：keiki@mail.tdb.co.jp（Companies researched: 23,689; Valid responses: 12,000; Response rate: 50.7%;
Survey start date: May 2002)< Overview of August 2020: bottomed out >While the pickup in resumed economic activities became a positive factor forthe domestic economy in August, region-specific emergency declarations, etc.,
put downward pressure on business confidence. The domestic economy
remained on a slight recovery trend, even though a gentle recovery movement
was observed.

By industry : Business confidence was positive in seven industries, but isstill at a low level. Three industries, such as “retail,” deteriorated.
By size : Although all sizes showed positive business confidence for thethird consecutive month, polarization in the same size was also seen.
By region : Business confidence was positive in nine of the ten regions,with orders for public works and support of household consumption.

< Future outlook: Leveling-off >Although a recovery in consumer spending is expected, it seems that theeconomy will continue to be flat.

50
45
40
35
30
25
20
15
10
5
0

44.7 45.0 43.9 43.6

42.5 41.9

38.7
32.5
25.8 25.2 27.6

29.1 29.7 29.9 29.7 29.1 27.7 27.5 27.9 28.3 28.9 29.6 30.5

32.4 33.8
After 1 year

After 1 month

After 3 months
After 6 months（Prediction→）
Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun July Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun July Aug
2019
2020
2021
Projected future DI
44.7 45.0 43.9 43.6 42.5 41.9 38.7 32.5 25.8 25.2 27.6 29.1 29.7 29.9 29.7 29.1 27.7 27.5 27.9 28.3 28.9 29.6 30.5 32.4 33.8
Change from August.2020
0.2 0.0 -0.6 -2.0 -2.2 -1.8 -1.4 -0.8 -0.1 0.8 2.7 4.1*: Economic DIs are calculated based on the structural ARIMA model, in which economic statistics are incorporated to the ARIMA model.

©TEIKOKUDATABANK,LTD

TDB Trends Research August 2020

1

Economic Diffusion Index (Economic DI)1/2
Ratio to tHP
Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20

PrFDious
Month

Total

44.7 45.0 43.9 43.6 42.5 41.9 38.7 32.5 25.8 25.2 27.6 29.1 29.7

0.6

Large Firms

47.9 48.0 47.1 47.0 45.7 45.3 42.0 34.8 28.2 28.1 30.1 31.7 32.4

0.7

Small to Medium-sized Firms

43.9 44.2 43.2 42.8 41.7 41.1 38.0 32.0 25.3 24.6 27.0 28.5 29.1

0.6

Micro Firms

44.2 45.1 43.9 43.5 42.1 41.4 38.8 32.3 25.4 24.6 27.8 29.4 30.0

0.6

Ratio to tHP
Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20

PrFDious
Month

Agriculture,Forestry,Fisheries

41.5 41.8 42.3 42.5 41.7 38.4 37.9 32.8 28.2 25.1 29.6 31.4 31.0

▲ 0.4

Finance44.7 45.8 45.4 46.8 44.5 44.8 42.2 33.3 27.3 28.7 32.4 31.5 32.6

1.1

Construction

52.1 53.1 52.1 52.2 51.6 50.0 47.8 41.5 33.9 33.5 36.3 37.5 38.4

0.9

Real Estate

46.5 48.0 45.9 46.0 44.2 45.9 42.0 31.6 21.9 23.5 29.2 32.5 33.1

0.6

Food,BEWerages,Livestock Feed41.1 39.8 39.1 39.7 39.9 38.0 34.5 28.4 24.8 24.6 27.2 29.6 30.5

0.9

Textile,Textile Products,Clothing

36.9 36.3 36.1 34.6 32.6 30.5 29.3 23.2 16.7 17.7 17.9 19.8 20.3

0.5

Ceramics,Stone and Clay Products

45.2 44.1 44.8 43.8 40.2 39.9 37.2 33.4 29.2 26.5 28.1 28.3 29.8

1.5

Pulp, Paper and Paper Products

42.3 42.8 40.2 41.7 40.6 37.3 32.0 29.2 24.0 21.4 19.3 21.0 22.9

1.9

Publishing,Printing

33.1 34.1 33.0 32.7 32.9 30.9 29.7 23.1 16.8 14.4 16.0 15.8 18.8

3.0

Chemical41.8 41.0 41.2 40.6 40.1 39.0 35.8 32.1 27.5 25.3 25.9 27.3 27.8

0.5

Steel,Nonferrous Metals,Mining

41.2 40.4 39.8 38.1 37.6 36.3 32.9 29.0 23.6 21.5 20.8 22.3 23.6

1.3

General Machinery

41.5 41.1 40.8 39.9 38.4 37.3 35.4 31.1 25.3 23.6 23.5 24.6 25.0

0.4

Electrical Machinery

43.9 41.2 42.2 40.5 40.4 41.0 38.5 32.7 27.6 26.1 27.0 27.5 27.7

0.2

Transportation Machinery,Equipment

43.4 42.3 43.5 41.2 40.9 39.4 36.5 34.2 22.2 18.2 18.1 21.2 24.2

3.0

Medical Instruments and Equipment

43.4 42.0 41.3 42.0 39.9 40.4 39.0 34.8 27.2 26.3 28.6 28.1 29.6

1.5

Other

40.7 41.8 37.4 38.4 38.0 36.9 36.8 31.1 20.7 19.8 23.9 25.2 22.8

▲ 2.4

Construction Materials,Furniture,

Manufacturing

Precision Machinery,

Total

41.4 40.6 40.3 39.6 38.6 37.6 34.9 30.3 24.7 23.0 23.6 24.9 25.9

1.0

Food,BEWerages

39.0 38.8 38.1 37.9 37.4 37.3 33.1 25.6 21.3 21.0 24.5 27.3 27.2

▲ 0.1

Textile,Textile Products,Clothing

30.8 31.6 28.8 28.8 26.5 26.2 22.0 16.4 10.3 11.4 15.8 18.2 18.0

▲ 0.2

44.6 46.0 45.1 43.4 43.1 42.8 38.5 34.4 27.9 27.7 29.6 30.2 30.4

0.2

Paper Products,Stationery,Books

37.1 38.0 37.7 36.3 35.0 34.9 33.5 27.5 22.0 19.1 19.0 21.9 23.2

1.3

Chemical

42.0 42.7 41.0 40.4 39.0 38.7 35.5 33.2 28.9 27.4 27.6 29.2 29.5

0.3

Recycled Resources

32.8 30.6 34.8 29.0 33.3 30.8 27.1 21.2 18.7 18.8 23.8 24.5 27.8

3.3

Mining Products

38.8 37.6 38.0 37.0 34.8 33.9 31.9 27.8 23.2 22.8 24.0 24.5 25.3

0.8

Machinery,Equipment

43.3 44.6 42.7 42.3 41.7 41.2 38.2 33.0 25.9 25.1 27.4 29.0 28.6

▲ 0.4

Other

40.2 40.7 37.9 37.6 37.1 36.7 31.5 26.5 21.4 19.8 23.1 25.1 25.4

0.3

40.8 41.4 39.9 39.3 38.4 37.9 34.4 29.4 23.7 23.0 25.3 27.0 27.1

0.1

Construction Materials,
Furniture,Ceramics,
Stone and Clay Products

Wholesale

Steel,Nonferrous Metals,

.

Total

©TEIKOKUDATABANK,LTD

TDB Trends Research August 2020

2

Economic Diffusion Index (Economic DI)2/2
Ratio to tHP
Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20

PrFDious
MonthRetailFood,BEWerages

41.3 41.8 40.5 40.2 38.4 39.1 36.7 25.8 26.3 27.4 30.8 30.7 29.1

▲ 1.6

Textile,Textile Products,Clothing

36.5 37.9 32.7 31.5 28.7 28.0 24.2 16.2 11.4

23.6 24.7 24.0

▲ 0.7

Drugs,Sundries

37.7 40.6 35.8 37.3 40.2 37.7 34.7 27.5 28.7 25.3 32.7 32.7 31.3

▲ 1.4

Furniture

45.0 53.0 33.3 26.9 31.8 31.9 29.2 22.6 10.8 15.5 31.7 40.0 38.9

▲ 1.1

Information Machinery and Equipment

38.9 45.0 34.3 32.3 38.1 38.2 36.0 28.4 19.3 21.9 33.8 29.8 30.5

0.7

Motor Vehicles,Motor Vehicle Parts

41.1 41.4 34.5 31.4 31.9 36.7 32.9 27.9 17.0 15.8 25.4 29.3 29.3

0.0

Special Merchandise

40.7 43.5 38.2 39.1 36.0 35.2 34.7 27.4 20.2 19.9 27.7 30.2 30.0

▲ 0.2

Various Merchandise

38.9 43.1 36.5 36.5 36.2 37.4 34.4 29.3 32.3 29.9 34.5 40.9 36.9

▲ 4.0

Other

41.7 40.5 48.1 40.7 47.9 48.1 43.9 31.8 26.9 30.6 31.8 26.7 25.9

▲ 0.8

40.2 42.6 37.0 36.1 35.8 36.3 34.1 26.7 21.2 21.1 29.1 31.0 30.3

▲ 0.7

Electrical Household Appliances,

Total

Transportation,Warehousing

Service8.8

45.5 46.0 44.9 45.1 42.6 39.5 34.0 27.7 22.4 22.7 21.5 24.2 25.4

1.2

Restaurants

38.1 43.6 37.3 39.4 40.7 41.0 32.3 14.2

13.8 13.7 12.7

▲ 1.0

Postal,Telecommunications

60.6 56.9 56.1 59.5 52.8 64.6 57.1 50.0 30.3 33.3 43.3 41.7 42.6

0.9

Electricity,Gas,Water,Heat

52.6 51.3 51.2 52.2 47.4 52.4 46.7 40.5 28.4 32.4 34.4 34.9 42.5

7.6

Leasing,Rentals

51.7 53.5 54.5 53.1 50.4 50.8 46.9 34.0 27.8 29.1 30.2 31.4 32.7

1.3

Lodging, Hotels

39.9 47.2 41.3 42.0 39.1 38.5 23.2

7.0

1.5

2.9

4.8

6.0

0.9

Recreation

40.9 38.7 38.2 40.7 37.5 39.4 35.7 17.0

5.6

9.3

11.5 17.5 22.9

5.4

Broadcasting

45.2 43.1 42.9 41.7 38.2 38.1 38.9 29.8 22.9 22.5 26.7 25.6 34.5

8.9

Maintenance,Guarding,Testing

49.8 48.6 49.1 47.3 46.6 46.4 42.6 36.0 27.5 26.6 29.9 33.2 34.1

0.9

Advertising

38.9 40.3 40.4 39.6 37.8 40.0 34.1 21.3 11.3 10.7 14.3 19.0 18.0

▲ 1.0

Information

58.7 57.7 57.4 57.8 56.2 56.5 54.2 43.9 33.7 34.0 35.8 37.2 37.9

0.7

Labor Dispatching

51.0 53.2 53.3 50.9 46.2 49.2 42.5 34.1 21.0 20.0 25.3 24.6 25.4

0.8

Special Services

51.1 51.8 51.5 50.8 49.9 50.3 45.8 40.4 31.4 32.2 35.0 36.7 36.1

▲ 0.6

Medical,Welfare,Public Health46.5 47.3 46.5 48.5 47.7 47.8 43.2 35.9 26.4 26.1 30.5 29.9 31.0

1.1

Education

39.5 40.0 42.4 37.8 43.1 41.4 40.0 29.7 13.9 18.8 28.0 29.5 31.7

2.2

Other

48.3 48.4 47.9 47.9 45.6 46.2 39.8 29.2 21.2 21.8 26.6 28.7 28.4

▲ 0.3

Total

Other

4.3

5.5

5.1

50.7 51.0 50.6 50.4 48.8 49.5 45.1 35.3 25.8 26.1 29.4 31.2 31.8

0.6

43.2 42.1 43.1 40.4 41.7 42.7 39.2 29.8 24.4 26.2 27.1 29.3 28.8

▲ 0.5

Ratio to tHP
Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20

PrFDiousMonthHokkaido46.4 46.6 45.7 45.0 43.8 42.4 39.0 31.0 28.4 27.5 30.6 32.3 33.4

1.1

Tohoku41.7 43.2 41.9 42.2 40.9 38.8 36.7 30.7 26.0 25.3 28.5 29.7 30.4

0.7

kitakanto

42.6 42.2 40.9 40.0 40.0 39.4 36.9 31.8 25.8 24.5 26.2 27.1 28.0

0.9

minamikanto

45.7 46.1 45.5 45.5 44.3 44.5 41.1 34.1 26.3 25.5 28.4 29.7 30.4

0.7

Hokuriku

44.1 43.5 42.1 40.4 39.5 37.6 35.6 29.7 24.9 25.1 26.5 27.5 28.5

1.0

Tokai

45.0 45.2 43.6 42.7 41.8 40.6 37.3 31.4 23.7 23.4 25.3 27.0 27.7

0.7

Kinki

43.8 43.9 42.2 41.9 40.5 39.8 36.3 30.4 23.9 23.8 25.9 27.8 28.1

0.3

Chugoku44.8 45.0 44.0 43.6 42.6 41.2 39.0 33.8 27.0 25.7 27.2 29.4 29.7

0.3

Shikoku43.8 43.9 44.4 44.0 43.8 42.7 39.5 36.4 30.8 28.5 30.3 30.5 31.5

1.0

Kyushu46.3 47.1 46.5 46.8 45.1 45.2 41.5 35.3 27.5 27.4 29.7 32.5 31.8

▲ 0.7

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TDB Trends Research August 20203

Appendix

1.Research Subjects(Companies researched: 23,689; Valid
responses: 12,000; Response rate: 50.7%)
Appendix

1.Region
Hokkaido
TohokukitaKantominamikanto
Hokuriku

581
824
907
3,706
664

Kyushu

1,372
1,990
690
357
909

Total

12,000

Tokai

Kinki
Chugoku
Shikoku

2.Industry (10 Industries 51 Lines of business)
Agriculture,Forestry,Fisheries

64

Finance134

Construction

1,950

Real Estate

378

Manufacturing（3,322）Wholesale（3,159）Retail（487）

Food,Beverages

74

Textile,Textile Products,Clothing

32

Drugs,Sundries

24

Furniture

15

Electrical Household Appliances,Information Machinery and Equipment

41

Food,Beverages,Livestock Feed

391

Textile,Textile Products,Clothing

125

Motor Vehicles,Motor Vehicle Parts

Construction Materials,Furniture,Ceramics,Stone and Clay Products

259

Special Merchandise

153

Pulp, Paper and Paper Products

112

Various Merchandise

47

Publishing,Printing

199

OthersChemical

463

Transportation,Warehousing

533

Steel,Nonferrous Metals,Mining

567

Restaurants

63

General Machinery

539

Telecommunications

Electrical Machinery

370

Electricity,Gas,Water,Heat

Transportation Machinery,Equipment

9

9
20

120

Leasing,Rentals

129

Precision Machinery,Medical Instruments and Equipment

84

Lodging, Hotels

36

Others93

Recreation

64

Food,Beverages

418

Textile,Textile Products,Clothing

208

Construction Materials,Furniture,Ceramics,Stone and Clay Products
Paper Products,Stationery,Books
ChemicalRecycled Resources

Service（1,922）

197

369

Advertising

113

99

Information

524

301

Labor Dispatching

67

39

Special Services

309

Medical,Welfare,Public Health

136

1,005

Machinery,Equipment30

Education

388

Others14

Broadcasting
Maintenance,Guarding,Testing

332

Steel,Nonferrous Metals,Mining Products

211

Others51

OthersTotal

3.Size92

Large Firms

2,165

18.0%

Small to Medium-sized Firms

9,835

82.0%

micro Firms

3,532

29.4%

Total

12,000100.0%©TEIKOKUDATABANK,LTD

12,000

TDB Trends Research August 20204

An economic DI of 50 is the point separating good and bad, so a DI over
50 means “good,” and below 50 means “bad.” (The numbers are rounded
off to one decimal place.) No weight is given according to a company's size,and calculations are made on the basis of “one company, one vote.”

2.Research Items*Business Confidence (current, in 3 months, in 6 months, in 1 year)*Business Conditions (sales, purchasing and selling unit price, inventory, capacity
utilization ratio, number of employees, overtime work hours).Size Classification

3.Research Period and Methodology

Internet-based survey conducted August 18 – 31 2020

Industry
Manufacturing andOther Industries*

The explanation of the Economic Diffusion Index
Research Purpose/Researched Terms
TDB Economic Trend Research (started from May 2002) is a monthly
statistical survey conducted for over 20,000 nationwide corporations on theirgeneral business activities including the current condition and future outlookof the industry business performance and operating climate. The primary
purpose of such a survey is to assess the current state of Japan’s economy.
Selection of the Subject Corporations
Companies of all sizes in all domestic industries are eligible to participate in
the survey.

Wholesale Trade
Retail Trade
Service**

Large Firms

Small to Medium-Sized Firms(Micro Firms included)

Capital: More than 300 million yen
andNo. of Employee: Over 300
Capital: More than 100 million yen
andNo. of Employee: Over 100
Capital: More than 50 million yen
andNo. of Employee: Over 50
Capital: More than 50 million yen
andNo. of Employee: Over 100

Capital: Below 300 million yenor
No. of Employee: Below 300
Capital: Below 100 million yenor
No. of Employee: Below 100
Capital: Below 50 million yenor
No. of Employee: Below 50
Capital: Below 50 million yenor
No. of Employee: Below 100

Micro Firms
No. of Employee: Below 20
No. of Employee: Below 5
No. of Employee: Below 5
No. of Employee: Below 5

Note1: Large Firms refer to companies that rank in the top 3% in terms of sales volume according to the type of business, among small to midium-sizedcorporations excluding micro firms, which are defined in Small and Medium Enterprises Basic Act.
Note2: Small to Medium-Sized Firms refer to companies that rank in the bottom 50% in terms of sales volume according to the type of business, among
those not categorized as small to midium-sized corporations in Small to Medium-Sized Enterprises Basic Act.

DI Calculation
The DI（Diffusion Index）is calculated by multiplying the number of responses
for each assessment category by the number given in parentheses in thetable below, to a seven-level assessment rated by companies.
Selection category Extremely good

good

fairly goodneither good nor bad

fairly badbadvery badpoints

6

5

4

3

2

1

0

number of responses
for each category

N6

N5

N4

N3

N2

N1

N0

Economic DI＝

Total of (Points for each category× Number of responses for each category) 1
× × 100
Number of valid responsesN
6

∑
≡

6
i ≡0

i × Ni

N

×

1
× 100
6

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TDB Trends Research August 20205