December 5, 2018
Bank of Japan
Japan's Economy and Monetary Policy
Speech at a Meeting with Business Leaders in Niigata
Masazumi Wakatabe
Deputy Governor of the Bank of Japan
Introduction
It is my pleasure to have the opportunity today to exchange views with administrative,
financial, and business leaders in Niigata Prefecture. I also would like to take this
opportunity to express my sincere gratitude for your cooperation with the activities of the
Bank of Japan's Niigata Branch.
This is my first time to attend a meeting of this kind since I was appointed Deputy Governor
of the Bank of Japan in March this year. It is said that people here in the Echigo and Sado
regions historically have overcome severe natural environment -- such as dealing with
heavy snow, crossing over mountain ridges, and managing floods -- with diligence, patience,
and great ingenuity.1 I would like to hear your views on the current status of the local
economy, as well as your candid opinions about the Bank's policies and activities. First, I
will briefly explain developments in Japan's economic activity and prices, and then talk
about the Bank's conduct of monetary policy.
I. Current Developments in Economic Activity and Prices
Let me start by talking about the current developments in economic activity. Japan's
economy is expanding moderately. The real economic growth rate excluding the effects of
price movements, after registering relatively high growth of 3.0 percent on an annualized
basis in the April-June quarter of this year, marked negative growth of minus 1.2 percent in
the July-September quarter. This likely is mainly due to temporary factors accompanying
natural disasters that occurred successively this summer. Such a view is underpinned by the
fact that exports and production, which had declined due to the effects of natural disasters,
have turned to an increase since October.
The current economic recovery phase likely has lasted for six years already, which mostly
overlaps with the period of quantitative and qualitative monetary easing (QQE) that the
Bank introduced in April 2013, and this month its duration is expected to be the same as the
longest post-war recovery phase in the mid-2000s (Chart 1).2 I would like to point out two
characteristics of the current prolonged economic recovery, as follows.
A. First Characteristic of the Current Recovery: Economic Recovery Being
Widespread
The first characteristic is that the economic recovery has been widespread, bringing about
benefits to a wide range of economic entities.
First, in the corporate sector, there has been notable improvement not only in large firms but
also small and medium-sized firms (Chart 2). For example, according to our Tankan
(Short-Term Economic Survey of Enterprises in Japan), the proportion of small enterprises
responding that their business conditions have been "favorable" clearly has exceeded the
proportion of those responding that they have been "unfavorable" for the first time since
1991. Corporate profits also have improved widely, with domestic demand increasing under
large-scale monetary easing. In particular, profits of small and medium-sized firms that
support regional economies clearly have increased. This is a characteristic that was not
observed in the economic recovery phase in the mid-2000s, when improvement in corporate
profits was uneven, seen mainly in large manufacturing firms that benefited from high
growth in overseas economies.
Such improvement in the corporate sector -- including small and medium-sized firms in
local areas -- has led to firms' more active spending, such as business fixed investment, and
its effects also have spread to the household sector through increases in employment and
2
The following studies assess that the Bank's QQE from 2013 has pushed up production and the
inflation rate, and also has led to increased employment: (1) Miyao Ryuzo, Hi dentōteki kin'yū
seisaku: seisaku tōjisha to shite no shiten [Unconventional Monetary Policies: Perspective of a
Policymaker] (Tokyo: Yuhikaku Publishing Co., Ltd., 2016), (2) Ryuzo Miyao and Tatsuyoshi
Okimoto, "The Macroeconomic Effects of Japan's Unconventional Monetary Policies," RIETI
Discussion Paper Series, no. 17-E-065 (2017), (3) Adachi Seiji and Iida Yasuyuki, eds., Defure to
tatakau: kin'yū seisaku no yūkōsei: rejīmu tenkan no jisshō bunseki [Fighting Deflation: The
Efficacy of Monetary Policy: Empirical Analysis of Regime Change] (Tokyo: Nikkei Publishing Inc.,
2018), and (4) Giovanni Dell'Ariccia, Pau Rabanal, and Damiano Sandri, "Unconventional Monetary
Policies in the Euro Area, Japan, and the United Kingdom," Journal of Economic Perspectives, vol.
32, no. 4 (2018): 147-72.
wages. The number of job openings has increased significantly, with the active job
openings-to-applicants ratio currently standing in the range of 1.6-1.7, a level that exceeds
the peak of the bubble period in the late 1980s (Chart 3). Labor market conditions have
been tightening across Japan, and the active job openings-to-applicants ratios recently have
exceeded 1 in all prefectures, which was not observed even in the bubble period. At the
same time, the unemployment rate has declined in a wide range of regions.
An improvement in the labor market has been widespread across generations as well. For
example, the unemployment rate of the younger generation aged 15-24 rose substantially
amid the Japanese financial crisis of the late 1990s, and declined only moderately for a long
time after that (Chart 4). However, the situation has changed dramatically in the past few
years. The youth unemployment rate has declined to a level below that of the bubble period,
and labor market conditions for new graduates have created more of a seller's market than
ever before. With the perception of labor shortage heightening further, the number of
long-term unemployed workers -- those unemployed for over a year -- has been declining
steadily, although it used to be considered quite difficult for them to find a job. In addition,
improvement in the employment situation has contributed to providing new job
opportunities for those who had not participated in the labor market before. The population
aged 15-64 that has played a major role in the labor market, or the so-called working-age
population, has been declining from the peak in around 2000. On the other hand, the
number of employed persons recently has been increasing substantially (Chart 5). This is a
result of labor participation by women and seniors promoted through improvement in
employment together with the development of various labor-related measures by the
government. In addition, the poverty rate, which has risen moderately since the 1990s,
recently seems to have flattened or declined somewhat.
The declines in the youth unemployment rate and long-term unemployment rate, as well as
the increase in labor participation by women and seniors, are significant not only in terms of
increasing the current employment and production but also strengthening the growth
potential of the economy in the future. People acquire skills through actually working each
day and thereby raise their productivity. In particular, whether or not people have job
opportunities to enhance skills in their youth is likely to significantly affect their future
careers as well as the productivity of an economy as a whole. Given this, it is very
important to provide diverse and stable job opportunities for the younger generation. The
decline in the long-term unemployment rate also leads to raising the economy's productivity,
since skills could be lost gradually as the duration of unemployment becomes prolonged.
Widespread improvement in the labor market is likely to raise the growth potential of
Japan's economy.
B. Second Characteristic of the Current Recovery: Inflation Rate Turning Positive
The second characteristic of the current economic recovery is that wages and prices have
turned to an increase under large-scale monetary easing, which is different from the case in
the mid-2000s, when prices continued on a declining trend. The year-on-year rate of change
in the consumer price index (CPI) has been on an uptrend for more than five years since
autumn 2013, and Japan's economy is no longer in deflation, in the sense of a sustained
decline in prices (Chart 6). Price developments clearly have improved compared to the
period prior to the introduction of QQE, when the economy experienced prolonged
deflation. However, while the Bank's price stability target is to achieve the inflation rate of 2
percent, the current rate is at around 1 percent. I will later talk about this point in detail,
together with the Bank's monetary policy.
II. Outlook for Economic Activity and Prices
Now I would like to explain the outlook for economic activity and prices.
A. Outlook for Economic Activity
I will first touch upon the outlook for economic activity. Japan's economy is expected to
continue on an expanding trend from fiscal 2019 through fiscal 2020. Corporate profits at
high levels and improvement in the employment situation are expected to bring about
increases in business fixed investment and private consumption, with overseas economies
continuing to grow firmly on the whole.
However, there are various risk factors to this baseline scenario, including developments in
overseas economies. In particular, the consequences of the trade friction between the United
States and China still warrant some attention. In addition to this friction, various problems
exist between the two countries, including those regarding intellectual property rights,
technology transfer, and national security. Thus, the situation may remain highly uncertain
ahead of resolution of these problems. At this point, the impact of these problems on
economic activity at home and abroad is likely to be limited. However, if the problems
become more complex and prolonged, downward pressure on the global economy could
heighten not only through the gradual spread of the negative effects on trade activity, but
also deterioration in firms' fixed investment stance and cautiousness in financial market
sentiment. Looking back, the Great Depression of the 1930s is well known as a period when
protectionist policies prevailed around the world. Subsequent research suggests that what
mainly brought about the significant global economic downturn was severe deflation under
fiscal and monetary policies not responding appropriately, rather than protectionist policies.3
Therefore, policy authorities worldwide should bear in mind the importance of fiscal and
monetary policy management. Furthermore, attention should be paid to the fact that it is
difficult to analyze the effects of protectionist moves on the economy.4 This is partly
because trade structure characterized by the network of global supply chains is far more
complex compared to that in the 1930s, the share of trade volume in the global economy has
increased, and the amount of global capital flows has become massive. The Bank will
thoroughly examine the consequences of recent developments in the trade friction and their
potential effects on Japan's economy.
B. Outlook for Prices
As for the outlook for prices, the year-on-year rate of change in the CPI in Japan is likely to
increase gradually with the economy continuing on an expanding trend. The outlook for
prices is considered to be determined basically by two factors: the supply-demand balance
of the economy as a whole and people's expectations for future price developments.
Regarding the supply-demand balance, the tendency of demand exceeding supply is likely
3
For example, see Douglas A. Irwin, Clashing over Commerce: A History of US Trade Policy
(Chicago: University of Chicago Press, 2017), 397-400.
4
While traded goods were mainly primary products at the time of the Great Depression, the share of
manufactured goods in trade is large at present. As the proportion of manufactured goods increases
among traded goods, trade volume tends to fluctuate to a larger degree in response to changes in
income. For details, see Douglas A. Irwin, Trade Policy Disaster: Lessons from the 1930s
(Cambridge: MIT Press, 2012), 167n25.
to continue with the economy following an expanding trend. As actual wages and prices
increase along with this development, people's inflation expectations are expected to rise
gradually, and thus moderate inflation is more likely to be achieved.
There are various risk factors to the outlook for prices as well. For example, we cannot deny
the possibility that actual wages and prices will not rise easily despite excess demand
continuing going forward. Even when wages and prices rise, there is a possibility that such
movements will be perceived as a temporary phenomenon and people's inflation
expectations will not rise. Moreover, the scheduled consumption tax hike in October 2019
poses another risk for economic activity and prices.5
Households in Japan tend to respond sensitively to price rises, partly because they have not
experienced inflation for a long time. Reflecting such behavior of households, firms have
been cautious about raising prices of products. As the economy continues to improve, this
cautious stance of firms and households is likely to dissipate gradually, although there is
uncertainty as to when this change will occur. Such a situation may be due in part to a lack
of public understanding regarding the reasons why economic expansion accompanying
moderate inflation is desirable and of public confidence in the Bank's determination to
achieve it. If this is the case, the Bank should never be complacent and continue making
efforts to communicate better to the public. I would like to talk about this point hereafter,
together with the discussion on monetary policy.
III. Monetary Policy
Let me now move on to monetary policy. The Bank has continued large-scale monetary
easing by, for example, maintaining 10-year Japanese government bond (JGB) yields at
extremely low levels of around zero percent through purchasing large amounts of JGBs in
5
As shown in the Bank's Comprehensive Assessment released in September 2016, there are three
reasons why the inflation rate did not reach the price stability target of 2 percent within two years as
initially expected: the decline in crude oil prices, the slowdown in emerging economies, and the
consumption tax hike. The Bank estimates that the net burden on households due to the scheduled
consumption tax hike in October 2019 will be smaller than that at the time of the tax hike in April
2014. However, it is necessary to carefully examine the effects of the scheduled consumption tax
hike on people's consumption behavior and inflation expectations.
the market. It also has committed to continuing with such monetary easing going forward.
In what follows, I would like to talk about the Bank's basic thinking as to why it is
continuing with monetary easing and what it aims to achieve.
A. Negative Effects of Deflation
Why is the Bank aiming at price stability? Needless to say, households and private firms are
the main players in a market economy, but a market economy sometimes may not function
well. Therefore, the government and public institutions would need to complement it
properly. Price stability is one of the areas in which public institutions should be involved.6
The principle of the Bank's monetary policy is stipulated by the Bank of Japan Act. Article
2 prescribes that "[c]urrency and monetary control by the Bank of Japan shall be aimed at
achieving price stability, thereby contributing to the sound development of the national
economy." The ultimate objective is not price stability itself but the resultant sound
development of the national economy, generally accompanied by improvements in
employment and household income. Historically, the economy was negatively affected not
only by rapid inflation, such as experienced after World War II and in the 1970s, but also
serious deflation around the time of the Showa Depression in the prewar period and
deflation that lasted for about 15 years since the late 1990s.
Although people tend to think price declines are favorable because goods can be purchased
at a cheaper price, they actually give rise to significant negative effects in three respects.
First, declines in prices refer not only to those of goods and services that you purchase, but
also those of goods and services that your firm sells. If sales of your firm decrease, this
reduces your salary and consequently the budget available for spending, or can lead to
cutbacks in employment. As a result, economic activity as a whole will contract.
Second, price declines bring about difficulties in conducting economic policies. In an
economy where prices decline, tax revenue does not increase easily. Price declines also may
be an obstacle to the conduct of monetary policy. When an economy is under downward
pressure, it usually becomes necessary to reduce interest rates to support the economy.
Theoretically and empirically, however, interest rate levels tend to decrease to around 0
percent when prices decline (Chart 7). Thus, room for monetary policy response becomes
smaller if we rely only on the conventional policy of lowering interest rates, which would
make economic depression more severe.
Third, when economic depression lasts for a long time amid price declines, there is a risk
that the growth potential of the economy would be lowered and the behavior and mindset
based on the assumption that prices do not rise will become entrenched in the society, as I
mentioned earlier. In other economies, nominal GDP and nominal income increase steadily
amid moderate inflation. From a global perspective, I have to say that the past situation for
Japan's economy was quite exceptional, in that nominal GDP and nominal income peaked
out and subsequently leveled off for a long time under prolonged deflation (Chart 8). Price
declines may bring about significant negative effects on the economy, even if their pace is
moderate or does not accelerate.
B. Price Stability Target of 2 Percent
On this basis, price stability needed for the sound development of the national economy
involves avoiding not only rapid inflation but also deflation. Metaphorically speaking, this
is like maintaining a comfortable room temperature. A room's temperature should not be too
hot or cold. So, as for prices, should we aim at literally 0 percent inflation? In a situation
where the inflation rate is around 0 percent, room for monetary policy response through
interest rate control would be limited, as I mentioned earlier. Under such circumstances,
there is a risk of economic stagnation and deflation becoming prolonged once downward
pressure is exerted on the economy. Thus, one can draw the conclusion that the "appropriate
level of temperature for the economy" -- in other words, the inflation rate at which central
banks should aim -- is not literally 0 percent but a sufficiently positive figure, which secures
room for monetary policy response to avoid deflation.7
In relation to the "appropriate level of temperature for the economy," an increasing number
of central banks worldwide have adopted inflation targeting as a framework for monetary
policy, and setting the target level at around 2 percent has become a global standard among
advanced economies and regions (Chart 9).8 As financial markets and economies are
closely linked internationally, aiming at 2 percent inflation when other economies do so has
an important implication. For example, while it should be noted that the Bank's monetary
policy does not target foreign exchange rates, the fact that Japan aims at achieving the same
inflation rate as many other economies, including the United States and Europe, is likely to
stabilize foreign exchange rates from a long-term perspective, and thereby contribute to
establishing a business environment that enables firms to make decisions easily and
continue with their activities without unnecessary anxiety.
Based on these considerations, the Bank has set 2 percent inflation as the price stability
target and committed to achieving it. This is the Bank's commitment and a declaration to the
general public. As long as this is ensured, the experience of the deflationary era will not be
repeated. At present, although the inflation rate in Japan is improving steadily, it has
remained at around 1 percent, and thus we are only halfway to achieving 2 percent inflation.
In a case where downward pressure is exerted on the economy again, it may revert to
deflation. The Bank will encourage a rise in the inflation rate to the level that is appropriate
for the economy by continuing large-scale monetary easing with the aim of achieving 2
7
Those who proposed inflation targeting at an early stage considered that the most convincing
reason for aiming at a positive inflation rate was avoiding a risk of falling into deflation. For details,
see Ben S. Bernanke et al., Inflation Targeting: Lessons from the International Experience
(Princeton: Princeton University Press, 1999), 29-30.
8
Although it depends on the definition, approximately 40 central banks now adopt inflation
targeting. For details, see José De Gregorio et al., "IMF Reform: The Unfinished Agenda," CEPR
(2018): 12.
percent inflation and thereby maintaining economic improvement for a sufficiently long
period.9
In continuing with monetary easing, it is necessary to continuously examine not only the
effectiveness on inflation but also the impact on the financial markets and system. This is
expected to enhance the sustainability of the policy and consequently raise the certainty of
achieving 2 percent inflation.10
C. Communication to the General Public
In order to enhance policy effects, I think that it is important for the Bank to engage in
information dissemination and communication so that as many people as possible would
understand the state of the economy that the Bank aims to achieve, as well as its underlying
thinking. The conventional monetary policy that we learned at school mainly focuses on
raising or lowering interest rates, which was relatively easy to understand. However, in
Japan since the late 1990s and in the United States and Europe since the Global Financial
Crisis in the late 2000s, short-term interest rates have been close to 0 percent, which is an
environment that cannot be dealt with only through conventional monetary policy. Under
these circumstances, central banks actively adopted the so-called unconventional monetary
policy. This produced extremely powerful effects during the course of the global economy
moving out of the Global Financial Crisis. At the same time, however, monetary policy
became highly complex and difficult to understand for some non-experts. Outside Japan,
9
There are various debates over why the target level of inflation should be 2 percent, or what would
be the most desirable inflation rate. Recent studies increasingly suggest that the desirable inflation
rate be positive in view of preventing a risk of falling into deflation, based on the experience of the
Global Financial Crisis from 2008. However, the proposed specific figure ranges widely from a
positive rate close to 0 percent to around 6 percent. Meanwhile, Seiji Adachi argues that, using the
data for Japan's economy from 1983 through the second quarter of 2017, the inflation rate that would
be achieved under certain conditions in a time of an inflationary regime is 1.94 percent in terms of
the CPI inflation rate excluding fresh food and energy. For details, see Adachi Seiji, "2 pāsento no
infure mokuhyō wa datō ka," Keiki to Saikuru, no. 64 (2017): 3-16.
10
The Bank has been making a wide variety of efforts including conducting on-site examinations
and off-site monitoring of individual financial institutions, providing a wide range of information
such as through the Financial System Report, and cooperating with relevant regulatory authorities in
the development of financial regulations.
some appear to have joked that central banks' public statements can only be understood by
those with a Ph.D. in economics.
It is true that the Bank's current policy is somewhat technical, and we are expected to
communicate in detail to gain understanding from experts including market participants and
overseas authorities. Nevertheless, it is important for central banks to reach out not only to
experts but also households and firms, which play the main roles of and are driving forces
for Japan's economy.11 Regarding households and firms, I am aware that it is important to
reiterate the essence of the policy -- that is, what the Bank aims at and how it seeks to
achieve this -- rather than the details that tend to be highly technical.
For example, according to a survey conducted by the Bank, many households think that
their circumstances become worse off when prices rise (Chart 10). No one welcomes price
rises when their own income does not increase. Thus, it may seem natural that households'
tolerance of price rises would not increase easily, but wages generally grew at a higher pace
than inflation and households' purchasing power rose in the past phase of moderate inflation
(Chart 11). In order to change the cautious stance of households that tend to be reluctant to
accept price rises, it also is important to explain this basic mechanism of the economy in a
way that is easy to understand. In addition, the effects of monetary policy depend on
economic conditions. The expected growth rate of Japan's economy is likely to rise as
private firms actively undertake investment in capital and human resources as well as
innovation, or as the government establishes a business environment that encourages such
investment for the future or makes beneficial public spending, including that for education
as well as for the promotion of science and technology, while securing confidence in fiscal
sustainability. As the expected growth rate rises, monetary easing will more significantly
boost the willingness of firms to invest and households to consume, thereby further
ensuring the path toward achieving the price stability target of 2 percent. Thus, there are
synergy effects between efforts by various economic entities and the Bank's monetary
policy. With a view to sharing among various entities the significance of these effects, the
Bank needs to communicate effectively to a wide range of people.
I suppose that those attending this meeting also experience situations where it is necessary
to convey a message to residents and clients in plain language while engaging in complex
day-to-day operations. The same applies to monetary policy. Taking account of this, I have
explained today the essence of the Bank's thinking behind monetary policy.
Conclusion
Lastly, I would like to talk about the economy of Niigata Prefecture. The economy has
continued to recover steadily. Exports and production have maintained their relatively high
levels, mainly on the back of favorable external demand. Amid high levels of corporate
profits, business fixed investment intended for enhancing capacity and saving labor has
increased. With labor market conditions tightening, employee income has increased
moderately and private consumption also has recovered moderately.
On the other hand, Niigata Prefecture is facing challenges such as population decline, labor
shortage, and sluggish final demand. However, the prefecture's economy has some
advantages in overcoming these challenges and thereby achieving economic growth.
For instance, there is an agglomeration of industries with high technological prowess in a
wide range of fields such as metals, machinery, food, materials, and construction. In
addition, the information and communications industry has started to make advancements,
as partly evidenced by launches of new IT firms. As traditionally strong industries adjust to
globalization and technological progress, and new industries such as the information and
communications industry start up, the growth potential of the prefecture's economy is
expected to heighten further.
Moreover, Niigata Prefecture is blessed with a varied culture and history, as well as
abundant nature and food. This summer, I enjoyed an exhibition at the Tokyo National
Museum entitled "JOMON: 10,000 Years of Prehistoric Art in Japan." I was overwhelmed
by the sublime beauty of the national treasure from Niigata Prefecture -- a vessel with
Sasayama site in Tōkamachi city. The prefecture is also
flame-like ornamentation from the
famous for its sake (rice wine), and this owes to the entrepreneurial spirit that sought to
diversify product lines and enhance their quality against the background of declining prices
of rice in the Edo era that resulted from excess supply.12 Furthermore, while Koshihikari is
now a byword for delicious rice, efforts were needed to overcome many difficulties to get to
that point.13
Another significant advantage is that the prefecture is close to the growing economies of
northeast Asia. It has close historical relations with regions on the opposite shores, such as
the Russian Far East, China, and the Korean Peninsula. With the traditions of trade via
Kitamaebune, or northern-bound ships, Niigata Prefecture now has the potential as the
largest foothold for international interaction along the Sea of Japan to capture demand from
fast-growing Asian economies, both in terms of trade and tourism.
January 2019 marks the 150th anniversary since the Niigata port was opened to the world as
a trade port ahead of many other ones. As I mentioned at the outset, people here in the
Echigo and Sado regions historically have overcome challenges with their diligence,
patience, and ingenuity. I would like to close by expressing my hope that you will be
frontrunners in terms of overcoming deflation and vitalizing local economies while making
the most of the prefecture's advantages.
Thank you very much for your attention.
12
According to a history book, sake breweries in Niigata Prefecture in the Edo era tried to grasp the
taste of consumers by inviting specialists based long distances away. Specifically, Buzaemon from
the Uonuma Shiozawa region, who started a sake brewery in the late 1600s, and Kaemon from the
same region invited tōji -- sake brewers -- from Kyoto and Tokyo, respectively. For details, see
Tanaka Keiichi et al., Niigata-ken no rekishi, 2nd ed. (Tokyo: Yamakawa Shuppansha Ltd., 2009),
166-67.
13
Koshihikari originally was developed at an agricultural experiment station in Niigata Prefecture
during wartime in 1944, when quantity generally was prioritized over taste, and its breeding business
subsequently was suspended. After the launch of the Koshihikari brand, the Agricultural Cooperative
Association of Niigata Prefecture spared no marketing efforts to enhance its brand value ahead of the
competitors. For details, see Sakai Yoshiaki, Koshihikari monogatari: nippon-ichi umai kome no
tanjō (Tokyo: Chuokoron-Shinsha, Inc., 1997).
Japan's Economy and Monetary Policy
Speech at a Meeting with Business Leaders in Niigata
December 5, 2018
Masazumi Wakatabe
Deputy Governor of the Bank of Japan
Chart 1
Japan's Economy
Index of Business Conditions Length of Economic Recovery Period
CY 2010=100
130 Rank Period Length
February
120 1 73 months
2002February 2008
110
months
2 December 201270
(as of September 2018)
100
November
3 1965July 1970 57 months
(Izanagi Boom )
90
December
4 1986February 1991 51 months
80
(Bubble Boom )
November
5 43 months
70
1993May 1997
Chart 2
Widespread Economic Recovery I:
Corporate Sector - Improvement of Small Enterprises -
Business Conditions Scale of Improvement in
by Enterprise Size (Tankan) Corporate Profits
DI ("favorable" - "unfavorable"), % points tril. yen
60 40
Large enterprises
"Favorable"
35
Small enterprises
40
30
Small
"Unfavorable"
enterprises,
20
etc.
25
0 20
Large
enterprises
15
(nonmanufacturing)
-20
10
-40 Large
enterprises
5
(manufacturing)
0
-60
FY 2001→2007 FY 2012→2017
CY 85 90 95 00 05 10 15
Notes: 1. Figures in the left chart are based on Tankan. There is a discontinuity in the data in December 2003 due to a change in the survey framework.
Notes: 2. Figures in the right chart are based on current profits of the "Large enterprises" are enterprises with capital
Financial Statements Statistics of Corporations by Industry, Quarterly.
of 1 billion yen or more and "small enterprises, etc." are the rest. Excluding "finance and insurance."
Sources: Ministry of Finance; Bank of Japan.
Chart 3
Widespread Economic Recovery II: Labor Market (1)
Active Job Openings-to-Applicants Ratio Unemployment Rate
(by Prefecture) (by Prefecture)
s.a., ratio
s.a., %
3.0
10
Range of unemployment r