Japan Economic Temperature

Employment 30%

July unemployment fell to 2.4 percent and the active job-openings ratio stood at 1.18, but flat employment and fewer new openings kept the labor market tight without making it clearly overheated.

Real income & cost 25%

Nominal wages rose 3.4 percent in June and lifted real wages into positive territory, while inflation was about 1.9 percent in July, allowing household purchasing power to improve modestly after earlier cost pressure.

Consumption & confidence 20%

Real spending by households of two or more people fell 3.3 percent year over year in June, and despite consumer confidence improving to 35.5 in August, household consumption remained cool and cautious.

Housing 15%

Housing starts rose 8.2 percent year over year in July while average new-condominium prices in the Tokyo area reached a record, leaving the market hot but affordability strained by prices and financing costs.

Business environment 10%

The Tankan index for large manufacturers rose to 22 in June, but business failures exceeded 1,000 for a second consecutive month in July, revealing a sharp divide between improving large firms and pressured smaller businesses.

Semiconductors and electronicsHighestMost watched

Hot · AI demand prompted a large upgrade to the annual semiconductor-equipment sales forecast while large-manufacturer sentiment improved, making semiconductors and electronics the hottest listed industry.

Real estateMost watched

Warm · Tokyo-area new-condominium prices reached a record in July, with especially sharp gains in Tokyo's 23 wards, leaving real estate hot and intensifying household affordability pressure.

Inbound tourismMost watched

Comfortable · July inbound arrivals reached 3.4421 million, a record for the month, but softer new hiring in related industries kept inbound tourism active without pushing it into an overheated range.

ConstructionLowest

Cool · Housing starts rebounded year over year, but labor shortages, material costs, and business-failure pressure continued to squeeze margins, making construction the coldest listed industry.

Young people

Comfortable · Low unemployment and continued growth in regular jobs support young people's entry into work, but metropolitan housing and living costs still materially squeeze their disposable income.

White-collar workers

Comfortable · Expanding regular employment and growth in both nominal and real wages improve stability and pay conditions for white-collar workers, although softer job openings limit further warming.

Small business owners

Cool · Business failures exceeded 1,000 for two consecutive months, while input costs and labor shortages kept operating conditions cool for small-business owners.

First-time homebuyers

Cool · Record new-condominium prices in the Tokyo area and rising mortgage costs leave first-time buyers facing a severe entry barrier as home-price gains far outpace wage improvements.

ChatGPT

Unemployment is just 2.4 percent and real wages have turned positive, but softer job openings, falling real household spending, and higher mortgage payments keep residents' economic experience at the lower edge of the comfortable range.

Claude

A tight labor market, positive real wages, and multiyear-high large-company sentiment coexist with weak household consumption, rising small-business failures, and expensive housing.

Gemini

Strong employment and positive real-wage growth are supporting a warm recovery, while locally overheated metropolitan home prices and rising interest rates are also pressuring ordinary households.

DeepSeek

A tight labor market, strong large-company sentiment, and semiconductor investment are offset by only modest real-wage gains, cautious household spending, and record Tokyo home prices, keeping conditions comfortable overall.

Qwen

Unemployment has fallen to 2.4 percent and real wages continue to grow, but repeated declines in real household spending, record metropolitan new-home prices, and elevated business failures limit the improvement in lived conditions.