Expansion of the Hospitality Industry- The Japanese Economy

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Since 1868 in the Meiji era, economic growth for Japan has been on a steady upward trend. When the pre-war era Japan adopted the free market economy, it seems that there is no stopping the growth. The 60′s and the 80′s saw Japan going into what has been dubbed as an “economic miracle.” This growth after World War II is due to American investments and mainly to government economic interventionism. It was called a miracle because of the massive unemployment, inflation, and shortages in all areas of the country. The war essentially killed Japan economy. But they were able to climb up.

Today, Japan is obviously still an economic super power. Japan has the second largest stock exchange in Tokyo. Japan also has 3.6 million millionaires and is projected to go up by 10.7 million going into 2017. Imagine that. The question is; has the current economic depression affected Japan?

Yes it has.

Regardless of how many millionaires are in Japan, there is still a lot of belt tightening going on all over the country. In fact, Japan’s outbound travel is going down, and pundits are prognosticating that the worst is yet to come. The Japan Tourist Organization (JNTO) showed statistics that only 1,247,000 Japanese people went out of the country last January, dipping way down from the 1,451,116 recorded in 2007 of November. The Japan Economy Blog reported that overseas visitors to Japan have also been going down 18.4% in January, for sixth straight months of decline. The reason? The high cost of fuel surcharges that the airlines are putting on the customers.

The editorial in the Japan Times said that corporations have given up their sports clubs and sponsorship of events such as Formula 1 racing. Big companies, some very profitable, are scaling down their advertising budgets. People, even the most oblivious, are starting to notice the pinch. The economic downturn has been very stressful for the Japanese people that they rely heavily on alcohol and sleeping pills to sleep at night. Young women can no longer afford branded clothes, instead they just rent them.

Suicide is an all time high in Japan. According to reports in the editorial, 700,000 calls have been registered on the Japanese national suicide hotline.

The Japan economy blog reports that there are 1.4% fewer jobs in 2009 for graduate students. This is the first decline in job rate that Japan has to face in five years. 1.4% fewer jobs are laughable in the face of other country’s job rates, but you can’t laugh in solidarity with every country affected by the economic downturn.

The worry about job security and with the profitable companies cutting back on everything has infected the psyche of the Japanese people. Obviously, the economic downturn has not affected Japan that much compared to other countries, but still, the national consciousness of the people is dipping. Morale is very low. However the Japanese government is slowly realizing the perception problem.

Perhaps Prime Minister Taro Aso visiting the White House can learn inspirational leadership from President Barack Obama.

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