Globally, Economy Watchers Surveys are used to look at trends that set the economic pace for future growth, gauging business sentiment among people with jobs sensitive to economic trends – usually those that directly service consumers.
The index is used to gauge the direction of economic trends as they begin and are released as an index of economic indicators.
The Japanese Cabinet’s recently released Economy Watchers Current Index indicates several positive trends in businesses such as barbers, taxi drivers, and waiters.
Compiled from a survey of about 2,000 workers, the data reveals that the June Diffusion Index for confidence had jumped to 38.8, up 23.3 points from May’s reading of 15.5.
According to the Cabinet Office, this is the sharpest increase since data became available in January 2002. It reflects a rise for the second consecutive month, almost catching up to the 41.9 recorded in January 2020. In April, it had set a record low of 7.9.
Workers’ outlooks are also turning positive. The Diffusion Index gauging sentiment for the coming months climbed 7.5 points from May to 44.0, following a record jump of 19.9 points from April.
While the country’s taxi industry welcomed the optimistic news, another taxi-related development emerged.
Uber Taxis Enter Tokyo Market
Uber recently announced that users in Tokyo can now access their rideshare technology. Partnering with three Japanese taxi operators - Hinomaru Limousine Co., Tokyo MK Corp., and Ecosystem - the San Francisco-based company aims to make 600 cars available in the city’s popular central business district.
The ultimate goal is to bring Uber accessibility to all of Tokyo's central districts by the end of this year. More taxi operators could be added to the list as the company’s services expand. Currently, Uber offers rides in Kyoto, Osaka, and Hiroshima - also via taxi company partnerships.
Japan’s Tourism Industry Takes a Hit
The tourism industry in Japan still finds itself in a state of conflict. The number of international travelers to the country plummeted by to just 1,700 in May - a 99.9% drop from the same time last year.
To combat the slump, several tourism-based initiatives are set to take place. The country’s National Tourism Organization announced it will promote rural travel to attract international visitors while still maintaining safety precautions.
Furthermore, the Japanese government launched a "Go To Travel" promotion that offers discounts for domestic travel.
Representatives from seven groups of hotel and inn operators, travel agencies, and other sectors of the tourism industry presented their proposals to Transport and Tourism Minister Akaba Kazuyoshi. These proposals cover measures that each sector will take to combat infection. According to Akaba, leisure groups need to completely overhaul their practices.
For example, buffet-style meals in restaurants will be served by staff. If guests serve themselves, they will be required to use a separate set of chopsticks to take food. These kinds of measures are meant to counteract the closure of domestic restaurants.
Restaurants Face Current Challenges and a Hopeful Future
In Japan, the effects of the economic downturn were reflected in the restaurant-related Diffusion Index, as many food outlets in Japan reopen. The food and beverage industry was among the hardest-hit industries in April, with a Diffusion Index of -3.1. However, June reported a Diffusion Index of 39.6, signaling a return to normal.
Among the first eateries to reopen was McDonald's Holdings Co. (Japan), which gradually reopened eating spaces at 1,440 outlets in 39 prefectures.
While conditions are forecasted to improve, an International Monetary Fund report indicates that projections are facing a “higher-than-usual degree of uncertainty.” Many spheres, including the restaurant industry, have been presented with major challenges that have left unshakable scars.
Economy Watchers Surveys have indicated positive tends towards economic recovery in Japan.
This positivity is especially reflected in the taxi industry, where Uber recently entered the market. With prospects for tourism still looking bleak, some campaigns have been launched to stimulate growth in the sector. Still, as restaurants begin their slow reopening practices, uncertain yet cautiously optimistic forecasts predict that the food industry will see better days ahead.