TDB Trends Research (Nationwide, Research & Summary January 2023)

Domestic economy deteriorates for second straight monthwhile cost burden increases～ Reflects rising living costs, lackluster production and shipments,and economic uncertainty overseas ～e-mail：keiki@mail.tdb.co.jp(Companies researched: 27,362; Valid responses: 11,719; Response rate: 42.8%; Survey
start date: May 2002)

By industry: Downturn in 7 industries, 37 business categories. The costof raw materials and the jump in electric bills are a heavy burden on
corporate activity< Trends in January 2023: Deterioration continues >The economic diffusion index (DI) in January 2023 was 42.1, down 0.9 pointfrom the previous month, for a second straight month of deterioration. Inaddition to rising living costs, lackluster production and shipments owing to areduction in the operation rate of facilities have caused the domestic economy
to decline for a second straight month.

By size: Large corporations are leveling off, but small- and medium-sizedcompanies had a second straight month of decline
By region: Worsened in all 10 regions for the first time in 11 months.
Regional disparities are tending to expand< Future outlook: Continued tendency to level off >Although uncertainty about economic conditions overseas willheighten, the economy is expected to generally level off.

55
5045

41.2

41.2 41.4 41.3 41.4 41.9
39.9 40.4 40.8

42.6 43.1 43.0 42.1

42.041.9 41.8 41.7 41.641.5 41.7 41.741.641.942.0 42.1

4035After 3 months
After 1 month

After 6 months

After 1 year

（Prediction→）
0 Jan Feb Mar Apr May Jun July Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun July Aug Sep Oct Nov Dec Jan30202220232024
Projected future DI 41.2 39.9 40.4 40.8 41.2 41.4 41.3 41.4 41.9 42.6 43.1 43.0 42.1 42.0 41.9 41.8 41.7 41.6 41.5 41.7 41.7 41.6 41.9 42.0 42.1
Change from Jan.2023-0.1 -0.2 -0.3 -0.4 -0.5 -0.6 -0.4 -0.4 -0.5 -0.2 -0.1 0.0
44.4
44.5
44.7 44.7equation
45.0 45.1
45.1 45.5 45.6 45.8*:Upper
The economic forecast DI is calculated using the Forecast Combination method of the results of the44.1
ARIMA
model
and44.6
the structuralmodel.
Lower
39.9 39.5 39.1 38.8 38.5 38.3 38.4 38.3 38.1 38.3 38.3 38.3

©TEIKOKUDATABANK,LTD

TDB Trends Research Jan 2023

1

Economic Diffusion Index (Economic DI)1/2
Ratio to theJan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22 Jul-22 Aug-22 Sep-22 Oct-22 Nov-22 Dec-22 Jan-23

PreviousMonthTotal

41.2 39.9 40.4 40.8 41.2 41.4 41.3 41.4 41.9 42.6 43.1 43.0 42.1

Large Firms

44.0 42.9 43.4 43.1 43.5 43.5 43.4 43.8 43.6 44.2 45.0 44.8 44.8

0.0

Small to Medium-sized Firms

40.6 39.3 39.8 40.3 40.7 41.0 40.8 41.0 41.6 42.3 42.7 42.6 41.6

▲ 1.0

Micro Firms

39.1 37.9 38.4 38.9 39.5 40.0 39.7 39.8 40.7 41.1 41.4 41.3 40.4

▲ 0.9

Jan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22 Jul-22 Aug-22 Sep-22 Oct-22 Nov-22 Dec-22 Jan-23

Ratio to thePrevious

▲ 0.9

Month

Agriculture,Forestry,Fisheries

38.7 36.4 34.8 35.0 37.6 34.7 36.3 35.9 35.8 36.4 37.7 37.9 37.4

Finance41.9 41.6 42.5 41.1 42.7 42.3 41.9 41.7 43.6 43.2 44.5 44.3 44.8

0.5

Construction

43.3 42.5 42.8 41.8 42.2 42.5 43.1 43.3 44.0 44.2 44.9 44.6 44.1

▲ 0.5

Real Estate

42.9 42.6 42.8 43.2 44.7 45.9 44.7 44.8 45.3 44.0 45.6 44.8 46.1

1.3

Food,BEWerages,Livestock Feed35.4 33.4 34.2 36.4 37.6 37.8 36.7 36.1 35.5 38.2 38.8 38.3 38.1

▲ 0.2

Textile,Textile Products,Clothing

31.6 31.7 33.0 34.6 33.8 34.4 36.1 32.6 36.2 35.7 36.5 37.9 37.7

▲ 0.2Construction Materials,Furniture,Ceramics,Stone and Clay Products

44.1 42.7 41.1 41.7 41.1 40.4 40.8 39.8 40.2 40.9 41.9 41.0 38.0

▲ 3.0Pulp, Paper and Paper Products

40.2 36.4 37.2 40.3 38.3 37.4 37.5 36.6 38.0 40.4 40.2 39.2 39.8

0.6

Publishing,Printing

28.6 29.5 29.6 30.7 30.3 29.7 29.1 29.6 30.0 31.8 32.9 32.4 31.7

▲ 0.7

Manufacturing Chemical

44.5 42.3 42.7 42.3 41.7 41.1 41.8 42.6 42.3 40.8 40.8 41.5 40.3

▲ 1.2

Steel,Nonferrous Metals,Mining44.6 43.8 42.6 42.1 40.9 41.2 42.9 42.7 43.0 43.9 43.6 43.1 41.7

▲ 1.4

General Machinery

47.7 46.7 46.7 45.9 46.9 46.3 46.3 46.2 45.4 45.8 45.9 44.9 43.3

▲ 1.6

Electrical Machinery

46.6 46.1 44.3 44.8 44.3 44.8 44.7 44.2 45.2 44.8 45.4 44.5 43.3

▲ 1.2

Transportation Machinery,Equipment

41.6 39.9 40.0 38.1 37.6 36.8 40.3 41.2 40.2 42.2 42.1 41.0 38.7

▲ 2.3

Precision Machinery,
Medical Instruments and Equipment

52.0 49.5 47.1 46.8 48.2 48.8 48.5 46.5 46.2 46.1 46.1 46.3 46.5

0.2

Other

35.9 36.1 35.4 37.3 39.2 38.1 37.8 38.2 37.5 35.4 35.9 37.0 39.1

2.142.5 41.2 40.9 41.2 41.0 40.8 41.3 41.0 41.1 41.6 41.9 41.5 40.4

▲ 1.1

Food,BEWerages

32.7 30.1 32.6 36.2 37.3 37.1 37.0 35.6 35.8 37.4 38.8 38.2 37.5

▲ 0.7

Textile,Textile Products,Clothing

27.6 24.9 25.4 28.7 31.4 31.3 29.9 29.9 29.9 32.4 33.1 34.0 34.7

0.7

Construction Materials,Furniture,Ceramics,
Stone and Clay Products

40.0 39.7 40.5 38.6 38.1 38.3 38.6 38.5 37.5 39.8 39.5 40.2 38.3

▲ 1.9

Paper Products,Stationery,Books

32.7 31.9 34.6 33.8 34.2 32.8 33.0 33.5 34.5 37.1 37.0 33.8 34.8

1.0

Chemical

43.2 41.9 43.5 42.3 42.3 41.6 43.5 43.0 43.4 42.6 43.8 43.5 42.8

▲ 0.7

Recycled Resources

45.8 50.5 53.2 54.0 47.5 41.4 40.9 39.6 47.0 46.3 43.5 46.2 43.3

▲ 2.9Steel,Nonferrous Metals,
Mining Products

42.3 40.5 41.1 40.3 40.0 39.7 39.3 39.3 39.8 39.7 40.2 39.9 38.5▲ 1.4

Total

Wholesale.

▲ 0.5

Machinery,Equipment

42.8 42.4 41.9 42.5 42.0 42.9 43.1 42.6 43.3 44.1 44.1 43.8 43.0

▲ 0.8

Other36.3 33.7 35.5 37.3 37.8 38.1 37.7 37.7 38.2 39.0 39.6 40.9 40.0

▲ 0.9

39.0 37.7 38.6 39.2 39.4 39.4 39.5 39.2 39.6 40.6 41.0 41.0 40.1

▲ 0.9

Total

©TEIKOKUDATABANK,LTDTDB Trends Research Jan 2023

2

Economic Diffusion Index (Economic DI)2/2
Ratio to theJan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22 Jul-22 Aug-22 Sep-22 Oct-22 Nov-22 Dec-22 Jan-23

RetailPreviousMonthFood,BEWerages

36.5 36.3 38.6 37.7 41.8 42.7 40.3 39.9 40.2 39.6 43.2 42.2 42.3

0.1

Textile,Textile Products,Clothing

31.8 23.8 30.6 33.6 33.9 33.6 37.7 33.6 34.9 38.7 38.1 35.4 34.2

▲ 1.2

Drugs,Sundries

36.0 32.1 36.8 32.1 38.9 40.1 37.1 41.9 39.5 38.9 40.6 39.0 37.2

▲ 1.8

Furniture

35.6 29.8 30.6 39.2 34.3 39.8 35.2 36.1 40.0 37.8 36.2 31.0 34.2

3.2

Electrical Household Appliances,
Information Machinery andEquipment

32.3 30.2 33.0 33.7 34.7 34.0 36.7 32.7 37.1 35.1 35.3 37.2 36.3

▲ 0.9

Motor Vehicles,Motor Vehicle Parts

35.0 33.5 34.7 35.1 37.1 36.4 32.4 35.9 38.8 37.6 37.2 35.3 38.2

2.9

Special Merchandise

33.3 30.9 29.9 31.3 33.1 34.3 33.2 34.7 34.0 33.5 35.4 34.8 34.4

▲ 0.4

Various Merchandise

36.2 32.6 34.0 36.4 39.9 37.8 40.2 38.0 36.1 41.3 41.4 42.6 42.5

▲ 0.1

Other40.0 40.0 43.9 34.7 41.0 39.7 36.9 42.3 32.1 36.5 44.9 41.1 42.3

1.2Total

34.4 31.9 33.3 34.0 36.4 36.7 35.7 36.3 36.7 36.8 38.2 37.4 37.5

0.1

Transportation,Warehousing

37.7 35.5 35.4 36.6 37.2 37.1 37.8 37.3 38.2 40.7 41.6 41.6 38.9

▲ 2.7

Restaurants

24.2 16.9 23.8 32.8 34.3 38.0 34.0 28.1 31.8 39.0 39.1 41.5 38.5

▲ 3.0

Postal,Telecommunications

46.7 50.0 48.5 50.0 53.0 56.0 47.0 47.9 51.9 52.4 50.0 48.3 47.6

▲ 0.7

Electricity,Gas,Water,Heat

40.0 37.5 33.3 35.7 40.6 34.3 37.7 35.9 36.1 31.1 32.3 36.7 32.4

▲ 4.3

Leasing,Rentals

42.0 41.0 40.2 42.0 43.3 44.9 40.8 44.7 45.6 47.5 48.4 47.4 46.8

▲ 0.6

Lodging, Hotels

12.9 12.8 18.1 28.3 33.0 33.3 30.3 38.0 37.4 53.3 54.8 52.2 48.3

▲ 3.9

Recreation

33.3 31.2 35.1 35.6 38.9 41.6 40.7 40.1 42.2 45.0 43.8 43.2 42.1

▲ 1.1

Broadcasting

45.8 47.6 44.4 43.9 43.3 41.7 43.0 38.3 46.1 43.1 41.7 39.5 40.7

1.2

Maintenance,Guarding,Testing

42.3 40.2 42.3 43.1 42.5 44.2 42.2 43.4 42.8 42.8 43.6 45.6 42.9

▲ 2.7

Advertising32.7 31.5 36.4 36.9 34.8 37.3 34.3 36.7 39.3 40.9 40.3 39.7 40.2

0.5

Information

50.1 50.2 51.1 50.8 50.8 52.0 51.5 52.7 53.0 52.3 53.0 53.6 53.2

▲ 0.4

Labor Dispatching

45.1 41.5 44.4 45.7 47.6 45.7 46.5 49.8 47.4 48.8 46.5 50.0 48.5

▲ 1.5

Special Services

47.2 46.2 46.9 48.1 48.1 49.6 48.7 48.3 49.4 49.0 48.8 48.7 48.5

▲ 0.2

Medical,Welfare,Public Health42.4 41.0 42.5 44.5 44.4 43.5 42.5 41.2 41.7 43.2 43.6 42.8 42.9

0.1

Education

39.7 40.2 37.8 39.6 35.6 40.1 38.8 39.7 43.7 42.1 42.8 41.2 38.4

▲ 2.839.3 36.9 39.3 42.1 42.7 42.8 42.4 41.2 42.8 43.3 43.5 44.0 42.2

▲ 1.842.8 41.4 43.1 44.5 44.8 45.9 44.4 45.4 46.3 47.1 47.3 47.7 46.6

▲ 1.1

36.3 37.3 38.7 36.8 38.1 35.6 36.6 38.3 37.2 37.9 38.2 36.7 36.5

▲ 0.2

Jan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22 Jul-22 Aug-22 Sep-22 Oct-22 Nov-22 Dec-22 Jan-23

Ratio to thePreviousService

OtherTotal

OtherMonthHokkaido

38.6 37.0 36.5 37.9 38.9 40.1 41.0 40.2 40.7 41.2 40.9 40.8 40.1

▲ 0.7

Tohoku38.1 37.0 37.0 37.6 39.1 39.0 38.8 38.1 39.3 39.9 40.3 39.4 38.0

▲ 1.4

kitakanto

42.3 40.7 40.7 42.0 42.1 42.6 42.9 43.8 42.5 43.7 43.7 43.1 40.9

▲ 2.2

minamikanto

42.6 41.5 42.1 42.4 42.7 43.2 42.6 43.3 43.6 43.8 44.4 44.7 44.1

▲ 0.6

Hokuriku

40.9 39.2 39.2 39.9 40.6 40.5 41.5 40.8 41.7 42.3 42.2 42.2 40.9

▲ 1.3

Tokai

41.1 39.7 40.2 40.2 40.1 39.5 39.5 39.7 40.4 41.1 41.4 41.7 41.0

▲ 0.7

Kinki

40.8 39.8 40.5 40.8 40.9 40.9 40.9 41.1 41.5 42.3 43.0 42.7 42.0

▲ 0.7

Chugoku40.7 40.0 40.7 39.8 40.6 41.1 41.3 40.9 41.8 42.8 43.8 43.4 41.9

▲ 1.5

Shikoku39.3 37.1 38.9 38.1 38.7 38.4 38.3 37.7 38.7 40.3 40.0 39.3 39.0

▲ 0.3

Kyushu41.3 39.5 40.9 41.5 41.6 42.2 41.5 41.3 43.0 44.0 45.1 44.8 44.0

▲ 0.8

©TEIKOKUDATABANK,LTD

TDB Trends Research Jan 2023

3

Appendix

1.Research Subjects(Companies researched: 27,362; Validresponses: 11,719; Response rate: 42.8%)
1.Region

564

Hokkaido

Tokai

800

TohokuKinki

889

kitaKanto

Chugoku

3,389
599

minamikanto
Hokuriku

1,273
1,988
819

Kyushu

373
1,025

Total

11,719

Shikoku

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

120

Food,Beverages

Finance163

Textile,Textile Products,Clothing

60

Drugs,Sundries

64

Furniture19Construction

1,834

Real Estate

463
Food,Beverages,Livestock Feed

341

Textile,Textile Products,Clothing

118

Motor Vehicles,Motor Vehicle Parts

100

Construction Materials,Furniture,Ceramics,Stone and Clay Products

221

Special Merchandise

233

87

Various Merchandise

60

Pulp, Paper and Paper Products

168

Publishing,Printing

388

Manufacturing Chemical（2,900）

Wholesale（2,729）

Retail（714）126Electrical Household Appliances,Information Machinery and Equipment

39

13

Others532

Transportation,Warehousing

Steel,Nonferrous Metals,Mining

538

Restaurants

General Machinery

468

Telecommunications

93

Electrical Machinery

309

Electricity,Gas,Water,Heat

Transportation Machinery,Equipment

717100

Leasing,Rentals

108

Precision Machinery,Medical Instruments and Equipment

76

Lodging, Hotels

111

Others86

Recreation

108

Food,Beverages

361

Textile,Textile Products,Clothing

172

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

Service（2,222）

18

Broadcasting
Maintenance,Guarding,Testing

206

311

Advertising

121

92

Information

601

272

Labor Dispatching

88

30

Special Services

315
147

Steel,Nonferrous Metals,Mining Products

283

Medical,Welfare,Public Health

Machinery,Equipment863

EducationOthers

345

Others3624642Others
Total

3.SizeLarge Firms

1,791

15.3%

Small to Medium-sized Firms

9,928

84.7%

micro Firms

3,806

32.5%

Total

11,719 100.0%©TEIKOKUDATABANK,LTD

11,719

TDB Trends Research Jan 2023

42.Research Items

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.”*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 January 18 – 31 2023

Industry

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 26,000 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 inthe survey.

Manufacturing andOther Industries*
W holesale Trade
Retail Trade
Service**

Large Firm s

Sm all to Medium -Sized Firm s(Micro Firm s included)

Capital: More than 300 m illion yen
andNo. of Em ployee: Over 300
Capital: More than 100 m illion yen
andNo. of Em ployee: Over 100
Capital: More than 50 m illion yen
andNo. of Em ployee: Over 50
Capital: More than 50 m illion yen
andNo. of Em ployee: Over 100

Capital: Below 300 m illion yenor
No. of Em ployee: Below 300
Capital: Below 100 m illion yenor
No. of Em ployee: Below 100
Capital: Below 50 m illion yenor
No. of Em ployee: Below 50
Capital: Below 50 m illion yenor
No. of Em ployee: Below 100

Micro Firm s

No. of Em ployee: Below 20
No. of Em ployee: Below 5
No. of Em ployee: Below 5
No. of Em ployee: Below 5

Note1: Large Firm s refer to com panies that rank in the top 3% in term s of sales volum e according to the type of business, am ong sm all to m idium -sizedcorporations excluding m icro firm s, which are defined in Sm all and Medium Enterprises Basic Act.
Note2: Sm all to Medium -Sized Firm s refer to com panies that rank in the bottom 50% in term s of sales volum e according to the type of business, am ong
those not categorized as sm all to m idium -sized corporations in Sm all 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 goodgoodfairly goodneither good nor bad

fairly badbad

very badpoints

65

4

32

10

number of responses
for each category

N6N5N4N3N2N1N0

Economic DI＝Total of (Points for each category × Number of responses for each category)∑≡

Number of valid responses N
6i≡0i × Ni

N×16×16× 100× 100©TEIKOKUDATABANK,LTDTDB Trends Research Jan 20235