2020 ECONOMIC OVERVIEW OF TOHOKU REGION
Tohoku Bureau of Economy, Trade and Industry Table of Contents
1. Overview of the Tohoku Region (1) Overview of the Tohoku Region…………………………………………………………………………… 2 (2) Positioning of Tohoku Shown in Major Economic Indicators……………………………………………… 3
2. Economic Structure and Trends in the Tohoku Region (1) Gross Product……………………………………………………………………………………………… 4 (2) Real Economic Growth Rate……………………………………………………………………………… 5 (3) Population………………………………………………………………………………………………… 6 (4) Demographics……………………………………………………………………………………………… 7 (5) Number of Business Establishments (Private)……………………………………………………………… 8 (6) Industrial Production……………………………………………………………………………………… 9 (7) Retail…………………………………………………………………………………………………… 11 (8) Private Sector Capital Spending………………………………………………………………………… 12 (9) Acquisition of Plant Locations…………………………………………………………………………… 13 (10) Labor Force Population………………………………………………………………………………… 14 (11) Employment…………………………………………………………………………………………… 15 (12) Business Entry and Exit Rates………………………………………………………………………… 16 (13) Internationalization (i) Trade……………………………………………………………………………………………… 17 (ii) Internationalization of Corporate Activities……………………………………………………… 19 (iii) International Arrivals/Departures and Foreign Residents……………………………………… 20 (14) Tourism (i) Domestic Tourism………………………………………………………………………………… 21 (ii) International Inbound Tourism…………………………………………………………………… 22 (15) Reconstruction Related Trends………………………………………………………………………… 23
3. Industrial Structure of the Tohoku Region (1) Manufacturing (i) Overview………………………………………………………………………………………… 25 (ii) National Share by Industry Sector……………………………………………………………… 26 (iii) Shares of Industry Sectors by Year and Prefecture……………………………………………… 27 (iv) Value of Manufactured Goods Shipped from Major Industry Sectors and Value-added Productivity by Region………………………………………………………………… 28 (v) Manufacturing Companies Headquartered in the Tohoku Region……………………………… 29 (vi) Industrial Property Rights……………………………………………………………………… 31 (2) Commerce (i) Overview………………………………………………………………………………………… 32 (3) Service Industry………………………………………………………………………………………… 33 (4) Agriculture, Forestry, and Fisheries……………………………………………………………………… 34
* Years in text and graphs throughout this document are displayed according to the Western calendar. In addition, when the name of the source material follows the Japanese calendar, the Western calendar is written in parentheses with the exception of some parts. * Due to rounding up/off, not all totals equal the sum of separate figures in tables and graphs throughout this document.
1 Overview of the Tohoku Region 1
(1) Overview of the Tohoku Region
Gross Regional Domestic Product (GRDP) Share of national total: 6.3% Note : Overview Aomori Fukushima 12 9% 23.4% Iwate 34,452 0 13.5% billion yen Yamagata (FY 2017) 12.4% Miyagi Aomori Akita 27 5% 10 3%
Value of Manufactured Goods Shipped Share of national total: 5 6%
Aomori 9 6% Fukushima Iwate 28.2% 14.6% 18,619.6 Land Area Akita Iwate billion yen (2018) Share of national total: 17.7% Yamagata Miyagi 15.4% 25.1% Fukushima Aomori Akita 20.6% 14.4% 7.2%
66,948 km2 Iwate Wholesale Annual Sales Yamagata (2020) 22 8% Share of national total: 4.3% 13 9% Fukushima Aomori Akita Miyagi 14.4% 10.5% 17.4% 10 9% Yamagata Iwate 7.6% 11 2% 17,570 5 Akita 6.4% billion yen Population (2015) Share of national total: 6.9% Yamagata Miyagi
Miyagi Aomori Fukushima 50 0% 21.3% 14.4%
Iwate 8,669 14 2% Retail Annual Sales Yamagata people Share of national total: 7.2% 12.4% (2019) Akita Miyagi Fukushima Fukushima Aomori 11.1% 26 6% 21 2% 14.4% Iwate 9,966 6 13.7% Yamagata billion yen 11.6% (2015) Akita Miyagi 11 3% 27 8%
Economic Indicators for the Tohoku Region
Item Item Major Tohoku Data and source Major Tohoku Data and source economic indicators economic indicators Land area (km2) 2020 National Land Area Survey of Income per capita 2017 Annual Report on Prefectural (As of January 1, 2020) 66,948 Prefectures and Municipalities, Geospa-
(2) Positioning of Tohoku Shown in Major Economic Indicators Major economic indicators
Although Tohoku’s population accounts for 6.9% of Japan’s population, Tohoku is below the national level from the perspective of “gross regional domestic product (GRDP)” and “value of manufactured goods shipped.” In the manufacturing industry, Tohoku’s position is higher for “electronic parts, devices and electronic circuits.”
0.0 5.0 10.0 15.0 20.0 (%)
Land area [2020] 17.7
Population [2019] 6.9
No. of employed persons [2019] 6.8
(Primary industry) 14.9
(Secondary industry) 7.2
(Tertiary industry) 6.3
GRDP [2017] 6.4
(Primary industry) 14.1
(Secondary industry) 6.8
(Tertiary industry) 6.0
No. of business establishments [2016] 7.4
No. of employees [2016] 6.6
Value of manufactured goods shipped [2018] 5.6
(Electronic parts, devices and electronic circuits) 14.6
(Food) 7.3
(Transportation equipment) 2.9
(Produc ion machinery) 6.3
Wholesale sales value [2015] 4.3
Retail sales value [2015] 7.2
Department store/supermarket sales value [2019] 6.3
(Department stores) 3.0
(Supermarkets) 7.8
Convenience store sales value [2019] 6.8
New passenger car registrations [FY 2019] 7.6
No. of Housing starts [FY 2019] 5.8
Value of public works contracted [FY 2019] 14.0
No. of acquisitions for plant locations [2019] 8.8
Ratio of Tohoku’s population to Japan’s total: 6.9%
3 Economic Structure and Trends in the Tohoku Region 2
(1) Gross Product
The Gross Regional Domestic Product (GRDP) is 34.5 trillion yen, or 6.29% of the national total.
●In fiscal year 2017, the Tohoku region’s nominal GRDP was 34,452.0 billion yen, up 1.2% year-on-year, and 6.29% of the national total. In terms of Gross Product by prefecture, Iwate, Miyagi, Akita, and Yamagata prefectures have increased from the previous year.
Changes in Nominal GRDP for Tohoku and its Prefectures and Tohoku’s Share for Japan
(Trillion of yen) (%) 50 6.50 6.34 6.35 6.31 6.34 6.27 6 29 Share of the national total (right axis) 6.08
40 6.01 6.10 Gross Product
33.9 34.1 34.5 32 0 32 8 31 0 30.4 29.7 4.5 4 5 4.4 30 4.3 4.4 5.70 Aomori 4.3 4.4 4 3 4 6 4 6 4.7 4.4 4.5 4.2 Iwate 4.0 4 0 9.4 9.5 20 9.1 9.4 5.30 8.4 8.7 Miyagi 7.9 7.7 3.4 3.6 3.3 3.3 3.4 Akita 3.3 3 3 3.3 4.3 10 Yamagata 3.8 3.8 3.9 4 0 4.90 3.8 3.7 3.7 Fukushima 7.0 7.5 7.8 8.1 8.1 8.1 7.2 6 6 0 4.50 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 Note 1: With the System of Prefectural Accounts, the figures of previous fiscal years are amended retrospectively according to the estimates for the latest fiscal year. Note 2: To calculate the ratio of the gross domestic product for Tohoku to the total gross domestic product for Japan, the figures for Japan are taken from the System of National Accounts (SNA) of Japan for FY 2018. Source: Annual Report on Prefectural Accounts and Annual Report on National Accounts, Cabinet Office
●According to the breakdown of shares in fiscal year 2017 by industry classification, primary industries accounted for 2.7%, secondary industries for 28.6%, and tertiary industries for 68.7%. Share of the construction industry rose to 9.0%, up 3.2 percentage points compared to that of fiscal year 2010 before the Great East Japan Earthquake, which was due to recovery-related projects after the disaster.
Changes in the Share in Nominal GRDP between Industry Sectors
0 10 20 30 40 50 60 70 80 90 100 (%) 0.1
FY 2010 2 6 18.7 5 8 4.5 11.2 3.9 12.2 4.6 3.1 2 5 5.9 6 9 4.8 8.6 4.6 30,376.5 billion yen
0.1 Tohoku 34,452.0 FY 2017 2.7 19.5 9.0 3.7 11.1 3.3 10 9 4.8 2.7 2 5 6.1 6.8 4.3 8.4 4.0 billion yen
1 2 0.1 544,934.7 2017 20.9 5.7 2.6 14 0 4.2 11.4 5.1 4.9 2.6 7.4 4.9 3.6 7.0 4.3 billion yen Japan and fisheries forestry, Agriculture, Mining Manufacturing Construction management service water supply, and waste Electricity, gas, retail trade Wholesale and Finance and insurance Real estate postal services Transport and food service activities Accommodation and service activities and business support and technical activities, Professional, scientific Public administration Education social work activities Human health and Other services communications Information and
Primary industry Secondary industry Tertiary industry Note 1: The figures for Japan were calculated based on the Gross Domestic Product by Economic Activities (calendar year) from the System of National Accounts (SNA) of Japan for FY 2018. Note 2: The shares are before the addition and deduction of duties, customs and so forth on imported goods. Source: Annual Report on Prefectural Accounts and Annual Report on National Accounts, Cabinet Office
4 2 Economic Structure and Trends in the Tohoku Region
(2) Real Economic Growth Rate
The real economic growth rate is 0.9%, showing positive growth for six consecutive years.
●The Tohoku region’s real economic growth rate in fiscal year 2017 was 0.9% (cf. 1.9% for Japan), continuing the trend of positive growth for six consecutive years, though it was below the rate for Japan.
Changes in the Real Economic Growth Rate in the Tohoku Region (chain-linking method)
(%) Peak: February 2008 Peak: March 2012 Peak: October 2018 (tentative) Trough: March 2009 Trough: November 2012 6.0 4 8 Japan Tohoku
4.0 3.4 3.4
Economic Growth Rate 3 3
1 9 2.0 1.6 1.2 2.6 0.9 0.5 0.7 1.3 0.3 1.3 0.9 0.0 0.0 -0.4 0 8 0 2 -0.4 -2.0 -0.8 Great East Japan Earthquake -2.0 -3.4 -2 2
-4.0
Lehman Shock -4 5 -5.0 -6.0 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021
Note 1: The above figures for Japan after 2007 are taken from the System of National Accounts of Japan for FY 2018 (benchmark year = 2011, 2008 SNA). Note 2: Japan’s figures for fiscal years 2019, 2020 and 2021 are taken from the Mid-Year Economic Projection for FY 2020 released by the Cabinet Office on July 30, 2020. Note 3: The figures for the Tohoku region are es imated based on the bench mark year of 2011 using the chain-linking method (chain-linking of price indices based on the calendar year of 2011). Note 4: The figures for he Tohoku region from FY 2018 onward are not indicated because the six Tohoku prefectures have not yet released their datasets publicly. Note 5: Business-cycle peaks and troughs are based on the Cabinet Office’s reference dates for the business cycle. Source: Annual Report on Prefectural Accounts and Annual Report on National Accounts, Cabinet Office ●With respect to the level of contribution between different economic activities (by industrial sector) to the real economic growth rate for fiscal year 2017, manufacturing made a positive contribution of 1.64%; real estate business and electricity, gas and water supply, and waste management service, with a positive contribution of 0.14%; while the construction industry had a negative contribution of 1.06%. ●Looking at the real economic growth rate by prefecture in the Tohoku region, Iwate, Miyagi, Akita and Yamagata experienced positive growth, while Aomori and Fukushima had negative growth. When compared to fiscal year 2016, the growth rate turned from negative to positive in Iwate and Miyagi.
Contribution to the Real Economic Growth Rate in FY 2017 by Economic Activity Changes in Real Economic Growth Rate by Prefecture
(%) (Chain-linking method) (%) (Chain-linking method) 2.0 10 0 1.64 8 0 1.5 6 0 Yamagata 5.5 1.0 4 0 Akita 3.6 0.5 2 0 Iwate 2.1 0.14 0.14 0.10 0.10 0.0 0.05 0.04 0.04 0.02 0.00 0 0 Miyagi 0.5 -0.01-0.00-0.01 -0.01 Fukushima -0.8 -0 24 -2 0 Aomori -2.4 -0.5 -4 0 -1.0 -1 06 -6 0 food service activities Accommodation and -1.5 Manufacturing Real estate management service supply, and waste Electricity, gas and water Wholesale and retail trade Finance and insurance postal services Transport and Other service activities communications Information and Mining Education social work activities Human health and ivities service ac ies, and business support ivi ac ic and technical Professional, scienti and fisheries Agriculture, forestry, Public administration Construction -8 0 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017
Source: Annual Report on Prefectural Accounts Source: Annual Report on Prefectural Accounts
5 Economic Structure and Trends in the Tohoku Region 2
(3) Population
The productive-age population in the Tohoku region is projected to shrink by 32.7% in 2040 compared to 2019.
●In 2019, the Tohoku region had a population of 8.67 million, accounting for 6.9% of the national population (126.17 million). Tohoku’s population started to decrease after peaking in 1995, and is projected to decrease 22.3% to 6.73 million in 2040 compared to 2019, accounting for 6.1% of the national population.
Changes in the Population of the Tohoku Region
(Ten thousands) (%) 1,200 12 0 Share of the national total (right axis) 10.4 973 983 982 963 1 23 1,000 million 10 0 933 911 923 934 898 867 Aomori 9.2 Population 1 25 800 million 772 8.0 8.2 8 0 Iwate 7.8 7.7 7.5 673 7 3 7.1 6.9 600 6.0 Miyagi 6.5 2 31 6.1 million
400 Akita 4.0 0 97 million Yamagata 1 08 200 million 2.0 1 85 Fukushima million
0 0.0 1955 1965 1975 1985 1995 2000 2005 2010 2015 2019 2030 2040 Note: The above estimates are based on medium assumptions of births and deaths. Source: 1955-2015: Population Census of Japan, the Sta istics Bureau of the Ministry of Internal Affairs and Communications 2019: Population Estimates, Ministry of Internal Affairs and Communications 2030 and beyond: Population Projections by Prefecture, the National Institute of Population and Social Security Research (Projection from March 2018)
●In terms of population changes in three age groups between 2019 and 2040, the productive-age population (aged 15- 64) and the child population (aged 0-14) are projected to decrease by 1.61 million and 340,000 respectively, while the aged population (aged 65 or older) is projected to increase by 20,000. The decrease in population along with the declining birth rate and aging population is advancing in the Tohoku region ahead of the national average.
Population Trends in Three Age Groups Changes in the Population and the Population Aging Rate
(Ten thousands) (1955 = 100, index) (%) 1,200 160.0 80 0 Japan 140.1 1,000 140.0 70 0 Child 148 population 133 120.0 60 0 166 120 Population 800 106 97 Tohoku 92 9 78 100.0 50 0 63 600 Productive 80.0 40 0 -age 634 606 571 523 492 Tohoku 32.0 population 408 648 331 60.0 30 0 400 Population aging rate (right axis) Japan 28.4 40.0 20 0 200 277 286 20.0 10 0 Aged 223 238 260 279 Japan 5 3 population 200 169 Tohoku 4 6 0 0.0 0.0 1995 2000 2005 2010 2015 2019 2030 2040 1955 1965 1975 1985 1995 2005 2015 2019 2025 Note: The people whose age is unknown are distributed proportionally in 2019 and beyond. Source: 1955-2015: Population Census of Japan, the Sta istics Bureau of the Ministry of Internal Affairs and Communications 2019: Population Estimates, Ministry of Internal Affairs and Communications 2025 and beyond: Population Projections by Prefecture, the National Institute of Population and Social Security Research (Projection from March 2018)
6 2 Economic Structure and Trends in the Tohoku Region
(4) Demographics
Tohoku’s population is shrinking more with natural population reduction of 66,200 and net migration loss of 29,800.
●In 2019, the number of live births in the Tohoku region was 51,700, down 4,400 year-on-year, while there were 118,000 deaths, up 2,600 year-on-year. As a result, the natural population reduction increased from 59,200 in 2018 to 66,200. ●In 2019, 75,600 people moved into the Tohoku region, down 1,000 people year-on-year, while 105,400 people moved out of the Tohoku region, down 700 people year-on-year. As a result, Tohoku’s net migration loss (in-migrants minus out-migrants) increased from 29,400 in 2018 to 29,800. ●Among the 153,300 people who moved out of any prefecture in the Tohoku region, 47,900 people moved into another prefecture within the Tohoku region, and 105,400 people moved out of the region, showing that about 70% of the people moving left the Tohoku region. The destination of most of the people moving within the Tohoku region was Demographics Miyagi Prefecture.
Changes in the Number of Live Births and Deaths Changes in In-migrants and Out-migrants
(Thousands) (Thousands) 140 140 124.1 118 0 122.0 120 114.2 115 3 120 110.7 109.3 104 8 108.5 107.5 107.0 106.1 105.4
96.6 Number of in-migrants Number of out-migrants 100 100 92 0 87.7 85.3 86.4 85.7 Number of live births Number of deaths 75.0 78.7 76.7 75.6 80 70.0 80 63 3 58.7 56.1 60 51.7 60
40 40
20 20
0 0 2000 2005 2010 2015 2017 2018 2019 2000 2005 2010 2015 2017 2018 2019 Note: The 2019 values are approximate. Note: The number of in-migrants/out-migrants does not include Source: Annual Report on Demographic Statistics, Ministry of people who moved within the Tohoku region. Health, Labor and Welfare Source: Annual Report on the Internal Migration in Japan Derived from the Basic Resident Registers, Ministry of Internal Affairs and Communications
Number of Migrants within and into/out of the Tohoku Region (2019)
(Migrants) Prefecture/region (migration destination) Out- Inside Outside Tohoku total migrants Aomori Iwate Miyagi Akita Yamagata Fukushima Tohoku Tokyo area total total only Aomori 1,801 3,118 827 351 570 6,667 16,207 9,760 22,874 Iwate 1,830 4,788 920 476 809 8,823 12,400 7,881 21,223 Miyagi 2,035 3,415 1,652 2,953 4,057 14,112 33,350 20,262 47,462 Prefecture/region Prefecture/region (migration origin) Akita 839 1,007 2,341 499 457 5,143 9,621 6,209 14,764 Yamagata 318 398 3,699 497 1,119 6,031 10,708 6,813 16,739 Fukushima 485 628 4,694 395 952 7,154 23,115 13,946 30,269 Inside Tohoku 5,507 7,249 18,640 4,291 5,231 7,012 47,930 105,401 64,871 153,331 total Outside 11,020 9,306 25,739 6,279 6,965 16,332 75,641 Tohoku total Tokyo area 5,976 4,844 13,578 3,697 3,802 8,541 40,438 only In-migrants total 16,527 16,555 44,379 10,570 12,196 23,344 123,571 Source: Annual Report on the Internal Migration in Japan Derived from the Basic Resident Registers, Ministry of Internal Affairs and Communications
7 Economic Structure and Trends in the Tohoku Region 2
(5) Number of Business Establishments (Private)
Private business establishments in the Tohoku region represent 7.4% of the national total, while the number of employees accounts for 6.6% of the national total.
●In 2016, the Tohoku region had 414,657 private business establishments or 7.4% of the national total of 5,578,975 business establishments (7.3% in 2014). The number of the establishments decreased 2.3% from the previous 2014 survey. Akita, Aomori and Yamagata, in particular, saw significant decreases of 3.4%, 3.0% and 3.0% respectively. ●In 2016, the total number of employees in the Tohoku region was 3,726,422, down 0.9% from the previous 2014 survey.
Numbers of Private Business Establishments and Employees by Prefecture
No. of private business establishments No. of employees No. of business establishments 2014 2016 Comparison to Comparison to 2014 2016 Comparison to Comparison to 2014 (%) national total (%) 2014 (%) national total (%) Aomori 60,866 59,069 -3.0 1.1 508,770 498,988 -1.9 0.9 Iwate 60,543 59,451 -1.8 1.1 536,313 525,264 -2.1 0.9 Miyagi 103,505 102,026 -1.4 1.8 1,010,795 1,006,886 -0.4 1.8 Akita 51,156 49,432 -3.4 0.9 418,534 413,719 -1.2 0.7 Yamagata 58,292 56,551 -3.0 1.0 480,627 475,435 -1.1 0.8 Fukushima 89,971 88,128 -2.0 1.6 803,372 806,130 0.3 1.4 Tohoku 424,333 414,657 -2.3 7.4 3,758,411 3,726,422 -0.9 6.6 Japan 5,779,072 5,578,975 -3.5 100.0 57,427,704 56,872,826 -1.0 100.0 Note: The number of private business establishments includes those whose business details are unclear. Source: 2014 Economic Census for Business Frame and 2016 Economic Census for Business Activity, MIC and METI
●Looking at the breakdown of private business establishments by industry (major group category), wholesale and retail trade had the largest share at 26.6%, followed by accommodations, eating and drinking services at 12.3% and construction at 10.8%. The tertiary industry occupied a significant share at 81.2%. In comparison to 2014, medical, healthcare and welfare increased its share by 0.3 percentage points, while manufacturing and wholesale and retail trade each decreased their shares by 0.2 percentage points.
Changes in the Breakdown of Private Business Establishments by Industry (Major Group Category)
0 10 20 30 40 50 60 70 80 90 100 (%) 1.0% 0.1% 0.1% 0.8% 1.7% 2.7% 0.9% 2014 Accommodations, Living-re ated and Medical, Construction Manufacturing Wholesale and retail trade personal services and healthcare Services, n. e. c. 414,900 2.3% 5.7% 3.5% eating and drinking services 10.9% 7.1% 26.8% amusement services and we fare 6.8% establishments 12.3% 10.3% 7.3%
2016 405,012 10.8% 6.9% 26.6% 12.3% 10.2% 7.6% 6.7% establishments
Agriculture, forestry and Mining and quarrying of stone Finance and insurance 1.7% Scientific research, Education, learning Compound fisheries 0.1% Real estate, and professional and services 1.0% Transport and postal services 2.4% support 2.7% Information and communications 0.7% goods rental and technical services 3.5% 0.8% Primary industry leasing 5.6% 4,100 establishments Electricity, gas, heat supply and water 0.1% (1.0%) Secondary industry 72,204 establishments (17.8%) Tertiary industry 328,708 establishments (81.2%)
Note: The number of business establishments by industry includes only those for which numerical data for necessary items were obtained. Source: 2014 Economic Census for Business Frame and 2016 Economic Census for Business Activity, MIC and METI
●In 2016, the number of employees in the Tohoku region was 3,726,422 or 6.6% of the national total (6.5% in the 2014 survey). The breakdown of employees in private business establishments by industry (major group category) was 1.3% for the primary industry, 26.2% for the secondary industry and 72.5% for the tertiary industry. In comparison to 2014, the employees in wholesale and retail trade decreased by 0.3 percentage points and those in living-related and personal services and amusement services by 0.1 percentage points.
Changes in the Breakdown of Employees by Industry (Major Group Category) 0 10 20 30 40 50 2.0% 60 70 80 90 100 (%) 1.2% 0.1% 0.4% 1 2% 2.4% 2.3% 2.5% 1.3% Accommodations L ving related an Transport service Medical, Services n. e. c. 2014 Construction Manufacturing Postal service Wholesale and retail trade eating and pe onal services nd drinking services amusement servic s healthcare and welfare 7.7% 3,758,411 9.7% 16.3% 5.3% 21.3% 13.1% employees 8.5% 4.5% 2016 3,726,422 employees 9.8% 16.3% 5.4% 21.0% 8.5% 4.4% 13 2% 7.7% Agriculture, forestry and fisheries Finance and 1.3% Mining and quarrying of stone Information and Scientific research, Education, learning Compound 0.1% communications 1.2% insurance 2.4% professional Technical support 2.6% Primary industry services Real estate, and goods services 2.4% 1.3% 48,098 employees Tertiary industry Electricity, gas, heat rental and leasing 2.0% (1.3%) 975,825 employees (26.2%) supply and water 0.5% Tertiary industry 2,702,499 employees (72.5%) Note: The number of employees by industry for 2014 is as of July 1, 2014, and that for 2016 is as of June 1, 2016. Source: 2014 Economic Census for Business Frame and 2016 Economic Census for Business Activity, MIC and METI
8 2 Economic Structure and Trends in the Tohoku Region
(6) Industrial Production
Weakening industrial production shows trends of decline.
●The Tohoku Region’s Index of Industrial Production (IIP) in 2019 shows a decrease of 3.9% year-on-year to 99.1 (2015 = 100). ●The quarterly IIP in 2019 (seasonally adjusted: 2015 = 100) in the 1st quarter declined 2.5% quarter-on-quarter to 100.2, owing to electronic components and devices, where fixed capacitors and inductors decreased. The IIP in the 2nd quarter decreased 1.0% to quarter-on-quarter 99.2 owing to the general-purpose and commercial machinery industry, where sales of cameras and interchangeable lenses for cameras decreased. The IIP in the 3th quarter declined 0.8% quarter-on-quarter to 98.4 owing to production machinery caused by a decrease in semiconductor manufacturing
Industrial Production equipment, etc. In the 4th quarter, the production machinery industry, etc. rose, while the transportation machinery industry, etc. declined, leveling off at 98.4 at 0.0%, showing a weakening overall in 2019. ●Looking at the production index for the first quarter of 2020, it increased by 1.8% from the previous quarter to 100.2 due to the production machinery industry, etc., where semiconductor manufacturing equipment increased. In the second quarter, IIP decreased by 12.3% to 87.9 due to the transportation machinery industry, which was affected by COVID-19 and decreased the number of automobiles and drive conduction / navigation equipment parts.
Changes in the IIP for Tohoku and Japan
(IIP) Annual IIP is original index; quarterly IIP is seasonally adjusted; 2015 = 100 110.0
Production in Tohoku 101.1 100.2 100.0 98.4 98.4 99.1 Production in Japan 99 2
90.0
87.9
Production in Tohoku Production in Japan 81.8 80.0 2014 2015 2016 2017 2018 2019 ⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠ Year 2014 2015 2016 2017 2018 2019 2020
Changes in the IIP by Industry Sector
Annual IIP is original index; quarterly IIP is seasonally adjusted; 2015 = 100 (IIP) 160.0 148 6 Production machinery
140.0
131.1 120.0 Transportation equipment
101.2 100.0
96.7 Electronic parts and devices 92.1 80.0
Production machinery Electronic parts and devices Transportation equipment 64.7 60.0 2014 2015 2016 2017 2018 2019 ⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠ Year 2014 2015 2016 2017 2018 2019 2020 Note 1: The IIP for Japan was prepared by the Ministry of Economy, Trade and Industry, while the IIP for Tohoku was prepared by the Tohoku Bureau of Economy, Trade and Industry. Note 2: The IIPs for both Japan and Tohoku were based, as reference, on 2015 standards. The annual revision was applied to the IIPs of both Tohoku and Japan for he period from January 2019. Source: Index of Industrial Production (IIP); METI and Tohoku Bureau of Economy, Trade and Industry 9 Economic Structure and Trends in the Tohoku Region 2
●Looking at the year-on-year growth rate of the production index in 2019 by industry, the industry that increased was the information and communication electronics products (up 20.5%). The industries that saw decline were the production machinery industry (down 12.7%) and the general-purpose and business oriented machinery (down 9.3%). ● When looking at the level of contribution by industrial sector to the year-on-year IIP growth rate of minus 3.9% for 2019, a negative contribution to the overall IIP was made by the production machinery industry (-1.25%) due to the decrease in semiconductor manufacturing, and by the electronic parts and device, where fixed capacitors and inductors decreased (-0.74%) contributed to overall industry decline. On the other hand, the information and communication electronics products (0.88), which increased the number of notebook PCs and desktop PCs, contributed to the rise.
Contribution (% point) by Industry Sector to 2019 2019 YoY Growth Rate (%) in IIP YoY Production Growth Rate (-3.9%)
Information and communication Information and communication electronics products 20.5 electronics products (580.4) 0.88 Industrial Production Chemical and petroleum products 0 9 Chemical and petroleum products (907.0) 0.08 Transportation equipment -1 6 Mining (19.9) -0.01 Food -1.7 Pulp, paper and paper products (361.9) -0.07 Pulp, paper and paper products -2 0 Textile products (254.7) -0.12 Miscellaneous manufacturing industries -3 2 Transportation equipment (788.7) -0.12 Electrical machinery -4.6 Food (1095.6) -0.18 Electronic parts and device -4.9 Electrical machinery (462.6) -0.21 Fabricated metal products -5.4 Plastic products (291.0) -0 25 Textile products -6.0 Fabricated metal products (490.9) -0.27 Mining -6.5 Miscellaneous manufacturing industries (964.7) -0.30 Ceramic, stone and clay products -7.6 Iron and steel, and non-ferrous metal (390.8) -0.31 Iron and steel, and non-ferrous metal -8.1 Ceramic, stone and clay products (602.7) -0.43 Plastic products General-purpose and business -8.1 oriented machinery (588.3) -0.57 General-purpose and business oriented machinery -9.3 Electronic parts and device (1526.2) -0.74 Production machinery -12.7 Production machinery (674.6) -1 25 The figures in parentheses indicate the weight for corresponding industry sectors. (Note) Share: Composition ratio of each industry to the whole (Industrial production = 10000) Contribution: Breakdown of increase / decrease rate of production by industry. It indicates the level of impact that is made on the entire industrial production through the increase or decrease of production in each industrial sector. Source: Tohoku Bureau of Economy, Trade and Industry, Indices of Industrial Production
●Looking at the production index for 2019 by goods, capital goods fell 6.8% year-on-year to 113.7. Semiconductor manufacturing equipment, other electronic application equipment, cameras, etc. contributed to the decline. Construction goods fell 2.9% year-on-year to 91.9. Ready-mixed concrete, other plastic products, cement, etc. contributed to the decline. The IIP of durable consumer goods increased 4.3% year-on-year to 89.8. Notebook PCs, desktop PCs, automobiles, etc. contributed to the rise. The IIP of non-durable consumer goods declined 2.0% year- on-year to 93.5. Plastic daily necessities / miscellaneous goods, gasoline, textile fiber products (outerwear), etc. contributed to the decline. Production goods fell 4.6% year-on-year to 99.5. Connectors, thermistors, light oil, etc. contributed to the increase, and fixed capacitors, cemented carbide chips, lithographic printing (offset printing), etc. contributed to the decrease.
IIP Trend by Goods
(I P) Original index, 2015 = 100 130.0
120.0
Capital goods 113.7 110.0
100.0 Producer goods 99.5 Non-durable consumer goods 93.5 90.0 Construction goods 91.9 Durable consumer goods 89.8 80.0 2014 2015 2016 2017 2018 2019 Source: Tohoku Bureau of Economy, Trade and Industry, Indices of Industrial Production
10 2 Economic Structure and Trends in the Tohoku Region
(7) Retail
Retail trade is at a standstill.
● In 2019, department stores and supermarkets in the Tohoku region recorded 1,215.3 billion yen of sales on an all- store basis, down 0.9% year-on-year, marking three consecutive years of sales decline. Meanwhile, sales at existing stores shrank 1.6% year-on-year, declining for seven consecutive years. ●In terms of year-on-year comparison of sales by store type (on an all-store basis) in 2019, department store sales decreased 3.3%, the seventh consecutive year of decrease, while supermarket sales decreased 0.5% for the first time in two years.
Department Store/Supermarket Sales Value and YoY Changes (All Store Basis)
(Hundred millions of yen) (%) 20,000 10.0 Supermarkets only
-0.5 Retail 16,000 -0.9 0.0 -3.3 Department stores only 12,403 12,306 12,265 12,153 12,000 -10.0
YoY change (right axis)
8,000 -20.0 10,290 Supermarkets 10,244
4,000
Department stores 1,975 1,909 0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 (Note) The sales amount is adjusted with some link coefficients (before June 2015). Source: Current Survey of Commerce, Ministry of Economy, Trade and Industry
11 Economic Structure and Trends in the Tohoku Region 2
(8) Private Sector Capital Spending
Capital spending plans see a decrease in both manufacturing and non-manufacturing industries.
●The private sector’s capital spending in the Tohoku region amounted to 322.5 billion yen in fiscal year 2020, down 6.0% year-on-year (according to the June 2020 survey). The manufacturing industry plans to decrease by 2.3% year- on-year. However, the non-manufacturing industry planned to decrease its capital spending by 11.2% year-on-year (a 10.0% year-on-year decrease when excluding electricity). Meanwhile, the actual capital spending in the Tohoku region for fiscal year 2019 decreased 5.2% year-on-year across all industries. Looking at the year-on-year comparison by industry sector in FY 2019, investment in transportation machinery increased in the manufacturing industry, and Private Sector Capital Spending some investment in electrical machinery, etc. was carried over to the next fiscal year, resulting in a slight increase of 2.1% year-on-year. The non-manufacturing industry decreased by 7.9% year-on-year due to the reactionary decrease in real estate due to the large-scale floor expansion of commercial facilities in the previous year (an 18.3% year-on- year decrease when excluding electricity).
YoY Changes in Capital Spending in the Tohoku Region
(%) 60.0
50.0
40.0
30.0
20.0
10.0 2.1 -2.3 0.0 -5.2 -6.0 -10.0 -7.9 -10.0 -20.0 -11.2 -18.3 -30.0 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 Actual Plan All industries Manufacturing Non-manufacturing Non-manufacturing (excl. electricity)
Note 1: The publicly released data (for the seven Tohoku prefectures including Niigata Prefecture) were recalculated for the six Tohoku prefectures. The same shall apply hereinafter. Note 2: Actual capital spending by industry sector in the seven Tohoku prefectures is not released publicly for 2010. Source: Survey on Planned Capital Spending in the Tohoku Region, Development Bank of Japan ●Looking at FY 2020 capital spending by industrial sector on a year-on-year basis, the manufacturing industry plans to increase its capital spending on electrical machinery, etc. due to increased investment for the enhancement of telecommunication equipment such as 5G. On the other hand, there are plans to reduce capital spending on transportation machinery and general machinery, etc. due to the completion of major investments over several years. In the non-manufacturing industry, although capital spending will increase in wholesale and retail, it is planned to decrease in many industries such as electric power and transportation due to the cautious attitude toward capital investment.
Capital Spending Trends (FY 2020 Plan)
500.0
Textile Ceramic, clay and stone products Other 500.0 4.3 Non-manufacturing ─── ── Iron and steel 0.03 3.4 64.9 8.1 100.0 ─── ── Petroleum 1.7 1.1 20.0 ─── Non-ferrous metals 0.9 42.7 ─── Electrical machinery 3.4 Gas 50.0 Chemicals 27.1 Wholesale and retail trade Services Food 12.7 ─── 17.8 13.5 ─── 9.6 17.8 ─── 14.3 ─── 4.8 ─── 1.3 ─── 3.2 5.7 3.1 0 Paper and pulp -3.3 Information ── Real Electricity and 7.0 estate Transport -16.7 Transportation ─── communications
YoY change in FY 2020 (%) change in FY YoY Precision equipment -16.3 -28.4 8.7 -10.5 -50.0 machinery Miscellaneous Construction ─── ─── ─── General -31.2 6.1 5.9 -24.6 ─── manufacturing -48.3 6.9 Leasing machinery ─── 15.6 ─── YoY change in FY 2020 3.4 industries 2.6 -86.7 -69.7 -6.6 ─── Breakdown in FY 2019 ─── ─── 0.4 2.6 2.7 -100.0 0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0 100.0
Breakdown of capital spending by industry sector in FY 2019 (%) Source: 2020 Survey on Planned Capital Spending in the Tohoku Region, Development Bank of Japan 12 2 Economic Structure and Trends in the Tohoku Region
(9) Acquisition of Plant Locations
Acquisition of plant locations has decreased for the first time in two years.
●In 2019, the number of acquisitions for plant locations (excluding electricity) in the Tohoku region was 85, a decrease of 17 acquisitions (or 16.7%) from the previous year and the first decrease in two years. The region’s share of the national total went down by 0.3 percentage points to 8.8%. ●By prefecture, Miyagi had the largest number of acquisitions at 24 (29 in 2018), followed by Fukushima at 19 (23 in 2018), Yamagata at 15 (22 in 2018), Aomori at 11 (6 in 2018), Iwate at 10 (14 in 2018), and Akita at 6 (8 in 2018).
Acquisition of Plant Locations Changes in Number of Acquisitions for Plant Locations
(Acquisitions) (%) 200 11.4 12.0 11.0 10.8 10.3 10.0 9.6 9.1 8.6 8.8 8.8 150 9.0 Share of the national total 8.0 (right axis)
107 107 97 102 100 91 6 6.0 88 89 85 74 84 14 78 11 Aomori Iwate 29 10 Miyagi 24 50 8 3.0 6 Akita 22 15 Yamagata 23 Fukushima 19 0 0.0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Aomori Iwate Miyagi Akita Yamagata Fukushima
Note 1: The Survey of Factory Location Trends targets the acquisition (including leasing) of land with a size of 1,000 square meters or larger for use to build a factory, business office or research center for manufacturing, electricity (excluding hydraulic power plants, geo- thermal power plants and solar power plants,) gas and heat supply. Note 2: Solar power plants were excluded from the 2015 survey for the electricity sector. Source: Survey of Factory Location Trends (Preliminary Report) January - December 2019: Tohoku Version, the Tohoku Bureau of Economy, Trade and Industry
●The top industrial sectors in terms of the number of acquisitions for plant locations were food and fabricated metal products (15), general-purpose machinery (8), and the chemical industry (6). Looking at this by prefecture, there are as many as 6 acquisitions in Miyagi prefecture and 4 in Iwate prefecture for food, and 5 in Miyagi prefecture for metal products.
Distribution of Plant Location Acquisitions by Industry Sector and Prefecture (2019) (Acquisitions) 0 5 10 15 20
Food Fabricated metal products General-purpose machinery Chemical products
Beverages, tobacco and feed
Manufacture of iron and steel Electronics and devices Textile products Ceramic, clay and stone products Business oriented machinery
Transportation equipment Lumber and wood Production machinery Information and communication electronics Furniture and fixtures Pulp and paper Petroleum and coal Non-ferrous metals Electrical machinery Aomori Iwate Miyagi Akita Yamagata Fukushima Gas
Note: Excludes electricity Source: Survey of Factory Location Trends (Preliminary Report) January - December 2019: Tohoku Version, the Tohoku Bureau of Economy, Trade and Industry
13 Economic Structure and Trends in the Tohoku Region 2
(10) Labor Force Population
The number of people employed is 4.56 million, and the number of unemployed is 120,000.
●In 2019, the number of people employed in the Tohoku region was 4.56 million, which exceeds that for 2010, a year before the Great East Japan Earthquake, and the number of unemployed was 120,000, which is a low level. This percentage of unemployed at 2.5% levels off from the previous year.
Number of Employed Changes in the Numbers of Unemployed and the Unemployment Rate
(Ten thousands) (Ten thousands) (%) 460 70 7.0
6.0 Labor Force Population 456 60 5.7 6.0 455 454 5.3
452 50 5.0 451 5.1 5.1 4.5 450 4.6 4.0 450 449 449 449 40 4.3 3.6 3.6 4.0 447 4.0 3.6 3.1 446 29 2.8 30 27 3.4 3.0 445 25 3.1 2.5 2.5 2.8 21 442 19 20 2.4 2.4 2.0 16 16 14 13 440 12 12 10 1.0
435 0 0.0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 The number of Unemployment rate Unemployment rate unemployed in Tohoku (right axis ) in Japan (right axis) Note: The figure for 2011 is a supplementary estimate made Source: Labor Force Survey, Ministry of Internal Affairs and because of the impact of the Great East Japan Earthquake. Communications Source: Labor Force Survey, Ministry of Internal Affairs and Communications ●By industrial sector, the largest number of people employed was seen in wholesale and retail trade at 720,000 (15.8%), followed by manufacturing with 680,000 (14.9%), medical, healthcare and welfare with 600,000 (13.2%), construction with 450,000 (9.9%), and agriculture and forestry with 320,000 (7.0%). The number for wholesale and retail trade increased by 30,000 people and manufacturing decreased by 20,000 with a change in the ranking of these two sectors since last year. ●The number of employed women aged 25-44 years (child-caring age) was decreasing, while the number of people employed (men and women) aged 65 and over was increasing. The employment rate for women aged 25-44 years and that for men and women aged 65 and over showed an upward tendency.
Number of Employees and Employment Rate Number of Employed by Industrial Sector (2019) (Women Aged 25-44 and Men and Women Aged 65 and Over)
Government services 21 n.e.c. 6 Fisheries 1 Service industry 28 Mining and (Ten thousands) (%) Agriculture quarrying Compound and forestry of stone 0 90 90 services 5 32 81.1 80 80 Construction 45 70 70 Medical, healthcare and welfare 4.56 60 60 60 million Manufacturing 50 83 50 people 68 Education, 78 77 73 (Ten thousands) learning 51 72 support 23 40 40 43 Living-related Wholesale 30 40 30 and personal Electricity, gas, 25.9 services and and retail heat supply amusement 72 20 20 services16 and water 2 Accommodations, Information and eating and drinking 10 10 communications 6 services 24 Transport and 0 0 Scientific research, Finance and insurance 8 postal services 21 2004 2009 2014 2019 professional and technical services 11 Real estate, and goods rental and leasing 6 Employed women aged 25-44 Employed men and women aged 65 and over Employment rate for women Employment rate for men and women aged 25-44 (right axis) aged 65 and over (right axis) Source: Labor Force Survey, Ministry of Internal Affairs and Source: Labor Force Survey, Ministry of Internal Affairs and Communications Communications 14 2 Economic Structure and Trends in the Tohoku Region
(11) Employment
Both the new job openings-to-applicants ratio and active job openings-to-applicants ratio decline due to the impact of COVID-19.
●In 2019, the annual average for active job openings-to-applicants ratio in the Tohoku region was 1.48, which was nearly as high as the national average of 1.60, whereas the ratio of new job openings to applicants was 2.06 in comparison to the national average of 2.42. ● The active job openings-to-applicants ratio in Tohoku in the second quarter of 2020 was 1.16 due to the to the impact of COVID-19, and the new job openings-to-applicants ratio also declined to 1.68.
Changes in the Active Job Openings-to-Applicants Ratio in Japan and Tohoku (times) 2.70 2019 average 2.45 Japan (New job openings-to-applicants ratio) 2.42 Employment Tohoku (Tohoku (new job openings-to-applicants ratio) 2.06 Japan (Active Job Openings-to-Applicants Ratio by Prefecture 1.60 2.20 Tohoku (Active Job Openings-to-Applicants Ratio by Prefecture 1.48
Japan (new job openings- 1.95 to-applicants ratio) 1.81
1.70 Tohoku (new job openings- to-applicants ratio) 1.68 1.45 Japan (active job openings- to-applicants ratio) 1.21 1.20 Tohoku (active job openings- 0.95 to-applicants ratio) 1.16
0.70 ⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠ 2014 2015 2016 2017 2018 2019 2020
Source: General Employment Placement Situation, Ministry of Health, Labor and Welfare
Active Job Openings-to-Applicants Ratio by Prefecture (times) 1.8
1.6
1.4 Akita 1.29 Miyagi 1.27 1.2 Fukushima 1.26 2019 average Yamagata 1.13 Aomori 1.24 Iwate 1.05 1.0 Iwate 1.39 Aomori 0.95 Miyagi 1.63 Akita 1.48 0.8 Yamagata 1.54 Fukushima 1.51 0.6 ⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠⅣⅢⅡⅠ 2014 2015 2016 2017 2018 2019 2020
Aomori Iwate Miyagi Akita Yamagata Fukushima
Source: General Employment Placement Situation, Ministry of Health, Labor and Welfare
15 Economic Structure and Trends in the Tohoku Region 2
(12) Business Entry and Exit Rates
The business entry rate has fallen for the third consecutive year, the exit rate has risen for the second consecutive year, and the exit rate has exceeded the entry rate.
●Looking at the employment insurance statistics for the business entry rate of the Tohoku region in FY 2019, it was 3.04% which marks the third consecutive year of decline. The business entry rate, which increased after the Great East Japan Earthquake, peaked in 2012 and has followed a downward trend, the lowest since the earthquake. For all of Japan, the business entry rate was 4.25%, a decrease in three consecutive years, which was also the lowest rate since the Great East Japan Earthquake. ●The exit rate has risen for the second consecutive year to 3.60%. Nationwide, the rate fell slightly to 3.43%.
Changes in Business Entry and Exit Rates in Japan and Tohoku
(%) Business exit rates 6.0 5.60 5.55 5.5 5.18 4.96 4.86 5.0 4.81 4.80
4.51 4.5 4.74 4.24 4.27 4.49 4.58 4.22 Business entry 4.09 4.04 4.05 4.41 rate in Japan 3.96 4.25 4.0 4.00 3.82 3.79 3.71 Business exit 3.91 3.90 3.60 rate in Tohoku 3.49 3.47 3.60 3.5 3.76 3.44 Business exit 3.47 3.52 rate in Japan 3.32 3.31 3.43 3.24 Business entry 3.0 3.17 rate in Tohoku 3.04
2.5 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 Note: The business entry and exit rates were calculated using the following formulas based on the data from the Annual Reports on Employment Insurance Services Entry rate = Number of newly applied establishments in the relevant year of employment insurance / Number of applicable establishments at the end of the previous fiscal year x 100 (%) Exit rate = Number of closed establishments in the relevant fiscal year of employment insurance / Number of applicable establishments at the end of the previous fiscal year x 100 (%) * Applicable establishments are business establishments that have an insurance relationship with labor insurance related to employment insurance pursuant to the provisions of the Act on Collection of Labor Insurance Premiums. An existing business establishment does not become a business establishment covered by employment insurance until it hires an employee. Source: Monthly and Annual Reports on Employment Insurance Services, Ministry of Health, Labor and Welfare
●Looking at the business entry rate in FY 2019 by prefecture, it decreased in all 6 prefectures in Tohoku. In terms of the difference between the business entry rate and the business exit rate, the former exceeded the latter by 0.82 percentage points for all Japan and decreased by 0.56 percentage points for the Tohoku region. By prefecture, the business entry rate exceeded the exit rate in Miyagi only.
Changes in Business Entry Rate in Tohoku by Prefecture Business Entry and Exit Rates in FY 2019
(%) (%) 5.00 7.0 4.25 Aomori Iwate Miyagi 4.00 entry rate Business 3.61 3.04 3.08 Akita Yamagata Fukushima 2.87 2.86 2.76 6.0 3.00 2.46 2.00 5.0 1.00 0.82 0.03 0.00 exit rate Business -0.34 4.0 1.00 -0.56 -0.69 3.61 -0.92 -0.92 2.00 -1.17 3.08 3.0 2.87 3.00 2.86 4.00 -3.43 -3.60 -3.58 -3.38 -3.45 -3.42 2.76 -4.04 -3.78 2.0 2.46 5.00 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 Japan Tohoku Aomori Iwate Miyagi Akita Yamagata Fukushima Source: Monthly and Annual Reports on Employment Insurance Note: Plotting (–) on each bar indicates the difference in rate Services, Ministry of Health, Labor and Welfare between business entry and exit. Source: Monthly and Annual Reports on Employment Insurance Services, Ministry of Health, Labor and Welfare
16 2 Economic Structure and Trends in the Tohoku Region
(13) Internationalization
(i) Trade
Exports and imports decrease for the first time in three years.
●The export value of the Tohoku region in 2019 was 677 billion yen, a decrease of 13.3% year-on-year due to a decrease in business equipment and motors, marking the first decrease in three years. Imports amounted to 1,803.4 billion yen, down 6.5% year-on-year for the first time in three years due to a decrease in crude and raw oil, metallic ores / scrap, etc. Exports account for 0.9% (1.0% in 2018) and imports 2.3% (2.3% in 2018) of the national ratio. Internationalization Changes in the Value of Exports and Imports Handled in the Tohoku Region
(Hundred millions of yen) (%) 2.5 25,000 Share of Japan's imports (right axis) 2.3 2.3 2.2 2.1 2.1 2.1 2.1 2.0 2.0 1.9 20,000 19,283 2.0 18,742 18,034 17,406 Share of Japan's exports 15,944 (right axis) 15,176 15,000 14,309 1.5 13,021 1.2 12,978
10,668 1.0 1.0 0.9 0.9 0.9 0.9 0.9 0.9 1.0 10,000 0.8 Value of imports 7,949 0.7 7,810 7,087 6,770 6,484 0.6 6,344 6,561 6,142 5,003 5,521 4,425 0.5
5,000 Value of 3,886 exports
0 0.0 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Note: The value of cargo that passed through export and import custom clearances at the custom offices in the six Tohoku prefectures. Source: Overview of Trade in the Tohoku Region, Yokohama Customs, Ministry of Finance
●By port, Sendai-Shiogama Port handled the largest volume of goods in the Tohoku region based on the value of exports, followed by the Port of Hachinohe and Onahama Port, whereas in terms of import value, the order follows Sendai-Shiogama Port, Onahama Port, and then Hachinohe Port. Compared to the previous year, exports were lower than the previous year at many ports, and imports were lower than the previous year at Sendai-Shiogama Port, Onahama Port, and Hachinohe Port, etc.
2018/2019 Trade Value by Port in the Tohoku Region
(Hundred millions of yen) (Hundred millions of yen) 4,000 3,000 2,000 1,000 0 0 2,000 4,000 6,000 8,000 10,000 69 Aomori Port 314 Exports 56 414 Imports 1,152 Port of Hachinohe 2,185 2018 1,197 1,739 2018 36 Miyako Port 21 2019 22 16 2019 91 Kamaishi Port 67 64 68 93 Ofunato Port 53 89 49 132 Ishinomaki Port 569 87 572 2,790 Sendai-Shiogama Port 8,002 2,233 7,287 140 Sendai Airport 46 148 21 838 Akita Port/ 1,809 738 Funagawa Port 1,892 897 Sakata Port 965 695 994 603 Soma Port 1,518 593 1,538 964 Onahama Port 3,719 845 3,433 Note: Ports in Tohoku are shown on the Map of Transport Infrastructure on page 53 in the Japanese version. Source: List of the Value of Trade by Port in Japan, Kobe Customs, Ministry of Finance
17 Economic Structure and Trends in the Tohoku Region 2
●Major destinations of Tohoku’s exports are China, the United States, and South Korea, while the major sources of its imports are Australia, China and the United States. ●Major export items include motors, pharmaceuticals, and iron/steel, while major import items include coal, crude and raw oil, and metallic ores and scrap.
2019 Major Destinations of Exports (Countries/Regions) 2019 Major Sources of Imports (Countries/Regions)
Australia China 14.6% Other 26.3% Marshall 2.4% 19.0% Other 32.3% China Philippines 2.9% 14.1% Indonesia 3.1% Indonesia Vietnam 3.5% 3.4% United States United States Singapore 3.7% 21.4% South Korea 3.7%
10.4% Internationalization Thailand 4.0% Belgium 4.1% Kuwait 4.5% Chile 4.2% Taiwan 5.4% South Korea 8.2% United Arab Emirates 4.3% Russia 4.4%
Breakdown of 2019 Export Values by Item Breakdown of 2019 Import Values by Item
Motors 11.6% Coal 16.7% Pharmaceuticals Other Office equipment Other 9.1% 28.1% 2.7% 37.4% Crude Iron and steel and raw oil 8.5% 15.9% Rubber Grains and products grain products Metallic ores Non-ferrous metals 3.0% 8.3% 3.1% and scrap LPG 3.1% 13.9% Semiconductor Seafood and seafood production equipment 3.8% Ships 5.7% products 3.3% Metallic ores and scrap 3.8% Paper, and Wood and cork products LNG 5.4% Office equipment 4.2% paper products 4.7% (excl. furniture) 3.4% Organic compounds 4.4% Source: 2019 Overview of Trade in the Tohoku Region, Yokohama Customs, Ministry of Finance
●Approximately 31.4% of marine export cargoes, comprised of products produced in the Tohoku region, were transported in international containers and loaded at the port of Yokohama, while 27.1% were loaded at the Port of Tokyo and 13.7% at Sendai-Shiogama Port. This implies that a large proportion of cargoes were loaded at ports located outside the Tohoku region. Meanwhile, 32.4% of marine import cargoes, comprised of goods to be consumed in the Tohoku region, were unloaded at the Port of Tokyo, 24.4% at Sendai-Shiogama Port and 13.6% at the Port of Yokohama, meaning about half were unloaded at ports in the Tohoku region.
Component Ratio of Export Cargo Volume (tons) by Shipping Port Component Ratio of Import Cargo Volume (tons) by Shipping Port (November 2018) (Production area: Tohoku) (November 2018) (Consumption area: Tohoku)
Other ports outside Other ports outside the Tohoku region 2.7% Other ports the Tohoku region 4.3% in the Tohoku region 4.3% Other ports in the Sakata Port 3.9% Tohoku region 4.9% Port of Hachinohe 5.5% Onahama Port 4.6% Port of Port of Tokyo Port of Yokohama 32.4% Akita Port Hachinohe 5.8% 31.4% Akita Port 11.4% The ratio of The ratio of 10.0% Tohoku region Sendai-Shiogama Tohoku region 38.8% Port 49.7% Sendai-Shiogama Port of 13.7% Port of Tokyo Port Yokohama 27.1% 24.4% 13.6%
Note: The survey is conducted once every five years for clarifying the contemporary status of the international maritime container cargo flow and policy making, etc. Source: FY 2018 Survey Results of Japan’s Export and Import Container Cargo Movements, Ports and Harbors Bureau, Ministry of Land, Infrastructure, Transport and Tourism
18 2 Economic Structure and Trends in the Tohoku Region
(ii) Internationalization of Corporate Activities
The number of overseas subsidiaries of companies headquartered in the Tohoku region decreases, and the value of exports and imports increases.
●According to the results of the survey for companies headquartered in the Tohoku region in FY 2018 (1,632 responding companies), 101 companies owned overseas subsidiaries and/or affiliates, amounting to 225. Specifically, out of these 225 overseas companies, the largest number was in Asian countries excluding China (88 companies, or 39.1% of the total), followed by China (76 companies, or 33.8%), and North America (26 companies, or 11.6%). ●With respect to overseas transactions by companies headquartered in the Tohoku region (FY 2018), the value of export goods was 401.7 billion yen (170 responding companies). Meanwhile, the value of import goods was 485.4 billion yen (172 responding companies). Internationalization Changes in the Number of Overseas Subsidiaries/Affiliates Changes in Values of Export and Import Goods by Owned by Companies Headquartered in the Tohoku Region Companies Headquartered in the Tohoku Region
(Companies) (Hundred millions of yen) Value of imports 300 5,000 4,854
248 4,468 250 242 243 243 4,500 225 231 13 16 14 4,139 15 219 225 10 13 26 26 4,056 4,032 4,069 25 15 28 19 3,954 200 22 23 17 21 16 16 17 26 4,000 180 17 13 3,678 Value of 2 14 90 3,622 exports 23 97 91 94 86 16 90 85 3,785 3,685 3,738 4,017 150 16 76 3,500 3,527 3,505 72 107 104 108 106 106 3,378 3,382 101 95 101 3,162 100 81 3,000
50 100 100 86 88 84 91 92 88 2,500 67
0 2,000 2010 2011 2012 2013 2014 2015 2016 2017 2018 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 (as of the end of March each year) Asia (excl. China) China Europe North Other Number of companies that own America regions overseas subsidiaries/affiliates
Note 1: The Basic Survey of Japanese Business Structure and Activities targets companies that own a business establishment engaging in mining, manufacturing, electricity and gas, wholesale, retail, and services with 50 or more employees and a capital or equity investment, amounting to 30 million yen or more. Note 2: In principle, overseas subsidiaries shall hold more than 50% of voting rights, and overseas affiliates between 20-50%. Source: Basic Survey of Japanese Business Structure and Activities, Ministry of Economy, Trade and Industry
●The number of foreign workers in the Tohoku region at the end of October 2019 was 38,911, an increase of 19.8% year-on-year. By prefecture, Miyagi had the largest number of foreign residents with 13,587, followed by Fukushima with 9,548.
Changes in the Number of Foreign Workers
(Workers) (%) 50,000 2.3 2.5 2.2 2.2 2.2 2.1 2.1 2.1 2.4 2.0 38,911 40,000 1.8 2.0 3,901 Share of the national total (right axis) 32,484 5,176 3,137 30,000 27,764 1.5 23,543 4,509 19,029 13,587 20,000 11,001 1.0 15,445 15,058 16,344 13,574 2,203 12,320 1,953 4,496 10,000 3,754 0.5 8,130 9,548 0 0.0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 (as of the end of October each year) Aomori Iwate Miyagi Akita Yamagata Fukushima
Note: The above figures are obtained by totaling the numbers reported in the notifications submitted by employers who are required to notify the status of their employed foreign workers (excluding those who are special permanent residents, and those who hold diplomatic/ official status) as of the end of October every year. Source: Table of Notification Status of Foreign Workers’ Employment Status, Ministry of Health, Labor and Health
19 Economic Structure and Trends in the Tohoku Region 2
(iii) International Arrivals/Departures and Foreign Residents
Among the international arrivals and departures via ports and airports in the Tohoku region, the number of non-Japanese nationals is increasing considerably.
●The total number of international arrivals and departures in 2019 using ports and airports in the Tohoku region was 605,553, an increase of 19.1% from 508,455 in 2018, and the number of immigrants in terms of both Japanese and foreigners increased. Although the numbers by port or airport at Aomori Airport decreased, the number of immigrants at Sendai Airport (up 28.2% year-on-year), Yamagata Airport (up 108.0% year-on-year), and Hanamaki Airport (up 43.2% year-on-year) all increased. The number of international arrivals and departures via ports and airports in the Tohoku region was 0.6% of the national total, which was the same as the previous year. Internationalization
Changes in International Arrivals and Departures through Ports and Airports in Tohoku Changes in the Number of International Arrivals and Departures in Japan
International Departures (Thousands) International Arrivals International Departures (Thousands) International Arrivals 400 200 0 200 400 60,000 40,000 20,000 0 20,000 40,000 60,000 229 117 112 113 111 224 2010 26,225 9,588 16,637 16,612 9,589 26,201 85 36 49 49 33 82 2011 24,329 7,335 16,994 16,921 7,281 24,202 133 40 93 91 42 133 2012 27,724 9,233 18,491 18,408 9,309 27,717 131 52 79 80 54 133 2013 28,761 11,289 17,473 17,422 11,385 28,807 132 54 78 73 60 132 2014 31,024 14,120 16,903 16,916 14,294 31,210 135 72 63 60 76 137 2015 35,842 19,629 16,214 16,259 19,842 36,101 129 75 54 53 79 132 2016 40,300 23,184 17,116 17,088 23,386 40,475 205 139 65 62 143 205 2017 45,242 27,353 17,889 17,876 27,603 45,480 256 176 80 74 179 253 2018 48,993 30,039 18,954 18,909 30,294 49,203 298 206 92 90 217 307 2019 51,230 31,149 20,081 20,030 31,379 51,409 Non-Japanese nationals/others Japanese Japanese Non-Japanese nationals/others Non-Japanese nationals/others Japanese Japanese Non-Japanese nationals/others
Source: Annual Report on Overseas Arrivals and Departures Statistics, Ministry of Justice
●There were 66,513 foreign residents in the Tohoku region as of the end of December 2019, an 10.6% rise year-on- year. By nationality, China accounted for 16,676 residents, representing 25.1% of the total, followed by Vietnam with 14,645 (22.0%), South Korea and North Korea with 8,861 (13.3%), and the Philippines with 8,107 (12.2%).
Changes in the Number of Foreign Residents (Former Alien Registration Card Holders)
(Residents) (%) 80,000 20.0 YoY change (right axis) 10.6 Other regions 826 7.4 8.0 5.8 6.4 South America 964 70,000 3.8 66,513 10.0 3.9 895 North America -0.4 777 60,120 2,540 -4.6 0.0 60,000 55,646 2,451 Other Asia Europe 1,701 7,266 52,298 1,555 Indonesia -12.1 48,683 48,732 6,253 2,367 50,000 46,014 -10.0 44,349 1,887 Philippines 42,857 42,691 2,077 Nepal 2,560 8,107 7,782 40,000 South Korea and -20.0 North Korea 9,006 8,861 30,000 Vietnam 11,290 14,645 20,000
China 10,000 16,147 16,676
0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 (The end of December) Note 1: "Other Asian countries" for 2010, 2011 and 2012 represent Asia countries excluding China, South Korea and North Korea. Note 2: With the revision of the Immigration Control and Refugee Recognition Act in July 2012 and the introduction of a new residence management system, the Foreign Resident Registration Act was abolished. Thus, statistics have been created for "medium- to long- term residents" and "special permanent residents" (hereinafter collectively referred to as "foreign residents"). As a result of these changes to the system, the figures for foreign residents under the new system and registered aliens under the old system do not match. Source: Statistics on Foreign Resident in Japan (formerly Statistics on Registered Aliens), Ministry of Justice
20 2 Economic Structure and Trends in the Tohoku Region
(14) Tourism (i) Domestic Tourism
The number of tourists to the Tohoku region has been increasing over the past seven years.
●The number of tourists to the Tohoku region decreased considerably in 2011 after the Great East Japan Earthquake, but recovered to 264.48 million in 2018.
Changes in the Number of Tourists to the Tohoku Region (Millions of tourists) (%) 400 20 YoY change (right axis) 14.9
350 5.0 10 2.5 3.2 2.7 0.8 1.5 300 0 Tourism 265.9 264.5 253.6 257.6 Aomori 243.8 251.6 -8.4 238.0 -10 250 34.2 35.0 226.6 35.2 35.2 35.0 Iwate 33.2 34.0 29.0 197.2 33.0 27.6 28.4 200 29.0 27.5 -20 31.5 28.8 28.9 Miyagi -25.8 27.4 62.3 64.1 61.3 60.7 60.8 22.7 57.4 -30 150 52.1 55.7 Akita 43.2 31.6 33.3 34.5 43.9 32.1 31.9 100 31.7 32.1 Yamagata 29.4 46.1 44.5 45.8 44.9 40.4 38.0 39.8 44.6 50 35.2 Fukushima 48.3 50.3 52.8 54.5 56.3 57.2 35.2 44.5 46.9 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 Note: The figures for 2010 are shown for reference purpose only because the survey criteria prior to 2010 differed among prefectures. Source: Tourism statistics for each prefecture
●The total number of overnight guests in each prefecture in 2019 increased in Iwate, Miyagi, Akita, Yamagata, and Fukushima prefectures. ●Comparing the tourism consumption amount and tourism consumption unit price in 2018 with the previous year, both of these increased in Miyagi, Akita, and Fukushima. Tourism consumption increased in Aomori and Iwate. The tourism consumption unit value increased in Yamagata.
Changes in the Total Number of Overnight Changes in Tourism Consumption by Prefecture Guests in Each Prefecture (Japanese / Sightseeing purpose)
(Thousands of guests) (Thousands of guests) (Hundred millions of yen) (Yen per tourist per visit) 14,000 700,000 3,000 24,000 Fukushima 12,657
12,000 600,000 2,500 20,000 Miyagi 10,934 Tourism consumption
10,000 500,000 2,000 Tourism consumption 16,000 unit value (right axis) 8,000 400,000 11,628 Iwate 6,277 1,500 12,000 10,024 6,000 300,000 9,316 Yamagata 5,572 7,966 8,056 Aomori 4,606 1,000 8,000 4,000 200,000 6,068 2,062 2,494 Akita 3,654 1,449 1,030 1,008 500 4,000 2,000 100,000 Japan 671 (right axis) 595,922 0 0 0 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Aomori Iwate Miyagi 2016 2017 2018 2016 2017 2018 2016 2017 2018 2016 2017 2018 2016 2017 2018 2016 2017 2018 Aomori Iwate Miyagi Akita Yamagata Fukushima Akita Yamagata Fukushima Japan (right axis)
Note 1: Estimated values such as the total number of guests at all Note 1: Tourism consumption refers to the total spent by inbound accommodation facilities. visitors to the relevant prefecture(s). Note 2: For the period from January to March 2010, the number of Note 2: The tourism consumption unit value refers to tourism visitors represents those staying overnight at consumption per tourist visiting the relevant prefecture(s) accommodations with 10 or more employees. during one visit. Source: Statistics on Inbound Tourists, Japan Tourism Agency Note 3: 2018 data for Iwate Prefecture is based on the "2018 Iwate Prefecture Tourism Statistics Overview". 21 Source: Statistics on Inbound Tourists, Japan Tourism Agency Economic Structure and Trends in the Tohoku Region 2
(ii) International Inbound Tourism
The total number of international inbound overnight visitors in the Tohoku region is rising to an extent that exceeds national figures.
Changes in the Total Number of Inbound ●The total number of foreign guests Overnight Visitors for Each Prefecture staying in the Tohoku region in 2019 (Thousands of visitors) (%) was 1.852 million, an increase of 25.7% 160,000 25.0 The ratio of the number of international inbound 19.4 from the previous year, which is in turn 140,000 overnight visitors in Japan region to the total (right axis) 20.0 higher than the national increase of 120,000 115,656 15.0
22.7% from the previous year. 100,000 94,275 10.0 79,691 4.2 ●By nationality, the number of guests 5.0 80,000 65,615 69,389 from Taiwan has increased rapidly in 60,000 0.0 44,825 recent years, reaching about 740,000 in 40,000 33,496 The ratio of the number of international inbound 27,509 26,314 Tourism 18,416 overnight visitors in Tohoku region to the total (right axis) 2019, up 35.6% from the previous year. 20,000 Japan Next is China with an increase of 23.9% Total
from the previous year to about 250,000 2,000 1,851.7 guests. Hong Kong is up 47.7% to 1,800 Aomori 110,000 guests and Thailand is up 1,600 1,473.3 356.6 1,400 Iwate 54.9% to 100,000 compared to the 349.1 344.0 1,200 1,065.6 previous year. 1,000 258.9 Miyagi ●Japanese tourism consumption from 800 725.5 563.0 607.9 600 577.1 402.1 Akita foreign visitors to the Tohoku region 402.1 139.4 400 349.8 275.7 123.4 Yamagata increased significantly to 65,354 million 210.0 200 163.5 234.1 176.4 Fukushima yen, up 82.3% from the previous year, 0 214.7 surpassing the previous year's results for 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 the second consecutive year. The unit Note 1: Estimated values such as the total number of guests at all accommodation facilities. price of tourism consumption was 60,882 Note 2: For the period from January to March 2010, the number of visitors represents yen per person, up 42.3% from the those staying overnight at accommodations with 10 or more employees. Source: Statistics on Inbound Tourists, Japan Tourism Agency previous year, surpassing the previous year for the second consecutive year.
Changes in the Total Number of Inbound Changes in Tourism Consumption Overnight Guests by Nationality by Inbound Visitors
(Guests) (Millions of yen) (Yen per tourist per visit) 800,000 80,000 72,856 80,000 Taiwan Tourism consumption 740,760 unit value (right axis) 60,882 700,000 70,000 60,000
65,354 600,000 60,000 45,202 45,212 48,474 40,000 546,310 42,795 34,191 500,000 50,000 20,000
396,740 40,000 0 400,000 35,857
China 300,000 30,000 245,000 197,720 21,857 22,298 20,993 20,000 200,000 160,180 Hong Kong 16,457 110,980 11,210 100,000 10,000 Thailand Tourism Consumption 104,540 0 0 2011 2012 2013 2014 2015 2016 2017 2018 2019 2012 2013 2014 2015 2016 2017 2018 South Hong The China Taiwan Thailand United Korea Kong States Note: The number of visitors represents those staying overnight at Note 1: Tourism consumption refers to the total spent by inbound accommodation facilities with 10 or more employees. visitors to the relevant prefecture(s). Source: Statistics on Inbound Tourists, Japan Tourism Agency Note 2: The tourism consumption unit value refers to tourism consumption per tourist visiting the relevant prefecture(s) during one visit. Note 3: 2018 data for Iwate Prefecture is based on the "2018 Iwate Prefecture Tourism Statistics Overview". Source: Statistics on Inbound Tourists, Japan Tourism Agency
22 2 Economic Structure and Trends in the Tohoku Region
(15) Reconstruction Related Trends
Community development is progressing steadily with the number of evacuees decreasing while the challenges of restoration are diversified and complicated.
●As of the end of March 2020, the progress of full-scale restoration and reconstruction of public infrastructure is 100% completion for railways, 99% for residential land for disaster public housing and private housing, reconstruction roads / reconstruction support roads, coastal measures, farmland, etc. The development of fishing ports is also making steady progress. ●The number of evacuees was more than 340,000 in March 2012, but due to the progress of community development, this figure decreased to about 43,000 as of August 2020.
Progress of Full Restoration and Number of Evacuees Nationwide Reconstruction of Public Infrastructure Reconstruction-related (%) 100100 99 (Evacuees) (Evacuees) 100 99 400,000 50,000 95 43,022 344,345 93 350,000 1,121 80 Iwate 313,329 1,286 76 40,000 72 300,000 7,545 263,958 250,000 60 Miyagi 225,177 30,000
200,000 170,841 40 20,000 150,000 33,070 Fukushima 119,163 100,000 20 71,365 10,000 50,564 46,678 50,000 Other
0 0 0 2013 2014 2015 2016 2017 2018 2019 2020 2012 2013 2014 2015 2016 2017 2018 2019 2020 2020 The end of March (as of March each year) August Coastal Reconstruction roads/ Railroads countermeasures reconstruction support roads Fishing Miyagi Disaster public-housing units Residential lots for Farmlands Iwate Fukushima Other private housing ports Note 1: The figures for coastal countermeasures, reconstruction roads Source: Number of Evacuees in Japan, Reconstruction Agency / reconstruction support roads, railroads, disaster public housing units, residential lots for private housing represent the ratios of the actual constructions completed to the number of the constructions planned (total length, units or lots). Note 2: The figure for farmlands represents the ratio of the area where farming resumption is available to that of the farmlands affected by the tsunami. Note 3: The figure for fishing ports represents the ratio of the number of fishing ports with their functions all recovered relative to that of the fishing ports that were affected by the tsunami. Source: Progress of Full Restoration and Reconstruction of Public Infrastructure, Reconstruction Agency ●The 2016 survey indicates that the number of business establishments was 12,226 (20.5% of the whole prefecture) in 12 municipalities along the coasts in Iwate Prefecture; an increase of 10.3% compared to the 2012 survey, while the number of employees was 90,396 (17.3%), an increase of 15.3%. Compared to the 2009 survey, however, the 2016 survey indicates a decrease of business establishments by 16.9% and of employees by 6.6%. Similarly, the number of business establishments in 14 municipalities along the coast of Miyagi Prefecture was 24,136 (23.7%), an increase of 8.4% from the 2012 survey, and the number of employees was 214,880 (21.3%), an increase of 12.5%. Compared to the 2009 survey, however, the 2016 survey indicates a decrease of business establishments by 20.7% and of employees by 11.7%.
Changes in the Number of Business Establishments and Employees in Affected Areas
No. of business establishments No. of employees
Compared to Compared to Compared to the Compared to Compared to Compared to the 2009 2012 2016 2009 2012 2016 2009 2012 whole prefecture 2009 2012 whole prefecture (%) (%) (%) (%) (%) (%) Iwate 64,293 59,537 59,451 -7.5 -0.1 - 546,239 509,979 525,264 -3.8 3.0 - 12 municipalities 14,716 11,089 12,226 -16.9 10.3 20.5 96,767 78,410 90,396 -6.6 15.3 17.3 Miyagi 106,937 98,190 102,026 -4.6 3.9 - 1,032,237 955,780 1,006,886 -2.5 5.3 - 14 municipalities 30,449 22,263 24,136 -20.7 8.4 23.7 243,351 191,077 214,880 -11.7 12.5 21.3 Fukushima 98,596 89,518 88,128 -10.6 -1.6 - 872,919 782,816 806,130 -7.7 3.0 - Note 1: 12 municipalities in Iwate Prefecture: Miyako City, Ofunato City, Kuji City, Rikuzentakata City, Kamaishi City, Otsuchi Town, Yamada Town, Iwaizumi Town, Tanohata Village, Fudai Village, Noda Village, and Hirono Town. Note 2: 14 municipalities in Miyagi Prefecture: Ishinomaki City, Shiogama City, Kesennuma City, Natori City, Tagajo City, Iwanuma City, Higashimatsushima City, Watari Town, Yamamoto Town, Matsushima Town, Shichigahama Town, Rifu Town, Onagawa Town, and Minamisanriku Town. Note 3: In the 2012 and 2016 surveys for Fukushima Prefecture, all or parts of the areas are excluded from the survey in Tamura City, Minamisoma City, Kawamata Town, Naraha Town, Tomioka Town, Kawauchi Village, Okuma Town, Futaba Town, Namie Town, Katsurao Village, and Iitate Village. Source: Economic Census Basic Survey for 2009 and Economic Census Activity Survey for 2012 and 2016 23 Economic Structure and Trends in the Tohoku Region 2
●As of the end of March 2020, 246 businesses were occupying the temporary facilities built by the Organization for Small & Medium Enterprises and Regional Innovation, Japan to restore economy and industry in the areas affected by the Great East Japan Earthquake. The number of these tenants is decreasing year by year because of relocating from temporary facilities to permanent facilities as business bases. ●Looking at the responses of the questionnaire conducted by the authority to reveal management issues faced by affected business operators, “securing and nurturing employees” and “securing and developing sales channels” were major responses from many of them. “Rising prices of raw materials” and “development of new commodities and technologies” were significant issues for the fisheries and food processing industries as compared to the other industries.
Changes in the Number of Enterprises Management Issues of Small and Medium Tenanting Temporary Facilities Enterprises (SMEs) Receiving Group Subsidies
(Enterprises) (%) 3,000 60.0 2,819 56.1 2,678 53.7 51.4 2,477 51.2 2,500 50.0 Reconstruction-related 45.0 2,120 All industries (n = 5,282) 2,000 40.0 Fisheries and food processing (n = 535)
1,500 30.0 28.0 27.9 1,353 26.4 49 23.5 23.8 20.0 1,000 20.0 40 743 15.7 83 9 500 102 10.0 9.0 55 6.7 110 246 5.1 4.2 4.3 2.7 291 4
0 0.0 Financing sales channels developing Securing and employees nurturing Securing and managerial talent nurturing Securing new commodities Development of measures Environmental expansion Overseas and other raw materials to purchase Soaring of prices Other 2014 2015 2016 2017 2018 2019 2020 The end of March Agriculture and forestry Fisheries Construction Manufacturing Wholesale Retail Eating and drinking services Services (excl. Eating and drinking services) Other
Source: Organization for Small & Medium Enterprises and Regional Source: Questionnaire Survey of Small and Medium Enterprises Innovation, Japanese website (SMEs) Receiving Group Subsidies (conducted in June Note: In March 2020, the number of businesses by industry was not 2018), Tohoku Bureau of Economy, Trade and Industry released publicly, so only the total number of businesses is shown. ● The production of marine fisheries in 2018 from three affected prefectures (Iwate, Miyagi and Fukushima) was 325,000 tons, and the production of marine aquaculture from two affected prefectures (Iwate and Miyagi) was 118,000 tons. Although the level of production has not yet recovered, the value of output was steadily reaching its level before the disaster. Soaring raw material prices in the fisheries and food processing industries can be surmised. ● The production of major processed seafood products in three affected prefectures in 2018 is broken down into fresh frozen seafood products (245,000 tons), prepared frozen products (39,000 tons), kamaboko or steamed fish-paste products (33,000 tons) and salted products (22,000 tons). The production of prepared salted products exceeds that of 2010.
Changes in the Production and the Value of Output for Marine Changes in the Production of Processed Seafood Fisheries and Aquaculture in Three Affected Prefectures Products in Three Affected Prefectures
(Thousands of tons) (Hundred millions of yen) (Thousands of tons) (Thousands of tons) 1,000 1,500 80 400 Marine fisheries and marine aquaculture 365.5 Value of output (right axis) 1,264 62.2 800 1,200 696 60 300 654 615 244.7 600 900 44.5 39.0 457 443 40 200 437 439 415 416 34.7 34.3 400 368 118 600 129 33.4 294 18.4 20 100 22.0 200 325 300 287
0 0 0 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2010 2011 2012 2013 2014 20152016 2017 2018
Kamaboko Prepared frozen products Salted products Production of marine fisheries Production of marine aquaculture Other processed products Fresh frozen seafood products (right axis)
Note 1: The production and the value of output for marine fisheries are the Note 1: The production of kamaboko from 2010 to 2015, and 2017 totals of those of three prefectures of Iwate, Miyagi and Fukushima. excludes that of Iwate Prefecture to conceal the individual Note 2: The production and the value of output for marine aquaculture data of its surveyed manufacture(s). are the totals of those of two prefectures of Iwate and Miyagi. Note 2: The production of salted products in 2010, 2011 and 2013 Source: Annual Statistics on Fishery and Aquaculture Production and excludes that of Fukushima Prefecture to conceal the Fishery Value of Output, Ministry of Agriculture, Forestry and individual data of its surveyed manufacture(s). Fisheries Source: Tohoku Agriculture, Forestry and Fisheries Statistics Annual Report; 66th Tohoku Agriculture, Forestry and Fisheries Statistics Annual Report 24 (2018 - 2019), Tohoku Regional Agricultural Administration Bureau 3 Industrial Structure of the Tohoku Region
(1) Manufacturing
(i) Overview
The shipment value of manufactured goods is 18,619.6 billion yen, which is the second largest amount in the past.
●The shipment value of manufactured goods in the Tohoku region in 2018 was 18,619.6 billion yen, an increase of 1.7% from the previous year, the second largest in history for the seventh consecutive year. In addition, the ratio to the whole country amounted to 5.6%, a decrease of 0.1 points from the previous year.
Changes in the Value of Manufactured Goods Shipped
(Trillion of yen) (%) 25 6.0 5.7 5.7 5.7 5.6 5.5 5.5 5.5 5.4 5.4 5.3 5.0 20 5.0 18.4 Share of the national total (right axis) 18.3 18.6 Aomori 17.2 16.8 1.9 1.8 1.6 16.3 16.8 15.8 1.8 Iwate 1.6 1.7 14.7 1.5 15.2 2.7 15 2.5 14.3 1.5 2.5 4.0 1.5 1.5 2.3 2.4 2.4 2.1 1.4 2.3 Miyagi 2.2 2.0 3.5 1.9 4.5 4.7 3.6 4.0 4.1 Akita 4.0
Manufacturing 10 3.7 3.0 1.6 2.9 2.8 3.4 1.3 1.4 1.3 Yamagata 1.2 1.2 1.2 1.2 1.2 1.1 1.1 3.1 2.8 2.9 2.9 2.4 2.6 2.6 2.7 2.4 2.6 2.4 5 2.0
Fukushima 6.0 4.7 5.1 4.3 4.6 4.8 5.1 4.9 5.0 5.1 5.2
0 1.0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Source: Economic Census for Business Activity (business establishments with 4 or more employees) and Census of Manufacture (business establishments with 4 or more employees)
●Looking at the manufacturing industry by prefecture, the number of business establishments increased in Aomori, and the number of employees increased in all prefectures except for Akita and Yamagata. The value of manufactured goods shipped and value added rose in Iwate, Miyagi and Fukushima. Meanwhile, the value of manufactured goods shipped was the highest ever for Iwate and Miyagi.
Manufacturing Industry Data by Prefecture
Value added Value of manufactured goods shipped (Gross value added for business No. of business establishments No. of employees (Millions of yen) establishments with 29 or fewer employees) (Millions of yen) 2018 2019 YoY change 2018 2019 YoY change 2017 2018 YoY change 2017 2018 YoY change Aomori 1,368 1,377 0.7 56,739 57,586 1.5 1,912,133 1,779,322 - 6.9 639,704 552,138 - 13.7 Iwate 2,087 2,087 0.0 86,662 87,940 1.5 2,525,650 2,727,177 8.0 757,934 801,382 5.7 Miyagi 2,629 2,579 - 1.9 117,177 118,720 1.3 4,469,649 4,665,553 4.4 1,427,060 1,448,220 1.5 Akita 1,758 1,711 - 2.7 63,009 62,539 - 0.7 1,375,450 1,335,769 - 2.9 577,219 502,839 - 12.9 Yamagata 2,482 2,436 - 1.9 101,074 101,048 -0.0 2,898,660 2,865,359 - 1.1 1,121,216 1,061,358 - 5.3 Fukushima 3,559 3,518 - 1.2 158,584 160,549 1.2 5,120,375 5,246,465 2.5 1,741,294 1,753,608 0.7 Tohoku 13,883 13,708 - 1.3 583,245 588,382 0.9 18,301,917 18,619,645 1.7 6,264,427 6,119,545 - 2.3 Japan 188,249 185,116 - 1.7 7,697,321 7,778,124 1.0 319,035,840 331,809,377 4.0 103,408,282 104,300,710 0.9
Note: The numbers of business establishments and employees are as of June 1. Source: Census of Manufacture (business establishments with 4 or more employees)
25 Industrial Structure of the Tohoku Region 3
(ii) National Share by Industry Sector
Tohoku has a high national share for information and communication electronics equipment, electronic parts, devices, and electronic circuits.
●Tohoku’s share of the value of manufactured goods shipped in Japan in 2018 was large for information and communication electronics equipment (15.2%), and electronic parts / devices / electronic circuits (14.6%), while it was small for iron and steel (3.1%) and transportation equipment (2.9%).
Value of manufactured goods shipped in proportion to the whole country (2018)
(%) 0.0 2.0 4.0 6.0 8.0 10.0 12.0 14.0 16.0 18.0
Information 15.2 (15.0)
Electronics 14.6 (15.5)
Leather 14.5 (13.7)
Lumber 11.5 (11.9)
Business 11.1 (9.8)
Rubber 8.7 (8.8)
Other 8.4 (9.7)
Ceramics 8.1 (8.3) Paper and pulp 8.1 (8.1)
Food 7.3 (7.4)
Non-ferrous 6.8 (7.9)
Production 6.3 (6.1) Manufacturing Beverages 5.6 (5.4)
Furniture 5.5 (5.8)
Textiles 5.5 (5.6)
Metals 5.4 (5.4)
Printing 4.7 (4.6)
Plastics 4.2 (4.4)
Petroleum 4.2 (4.0)
Electrical 3.9 (4.3) Tohoku’s manufacturing share of national total 5.6% (5.7%) General- purpose 3.9 (3.8)
Chemicals 3.4 (3.7) Iron and steel 3.1 (3.0) Trans- portation 2.9 (2.9)
Note: The tanned leather / related product / fur manufacturing industry and telecommunications equipment manufacturing industry are included in the total of the five prefectures except for Aomori to conceal the individual data of its surveyed manufacturer(s). The figures in brackets ( ) represent the share of the national total in 2017. Source: Census of Manufacture (business establishments with 4 or more employees)
Middle division of industrial Middle division of industrial classification Abbreviation Middle division of industrial classification Abbreviation Abbreviation classification Manufacture of general-purpose General- Manufacture of food Food Manufacture of petroleum and coal products Petroleum machinery purpose Manufacture of beverages, tobacco and feed Beverages Manufacture of plastic products Plastics Manufacture of production machinery Production Manufacture of business-oriented Manufacture of textile products Textiles Manufacture of rubber products Rubber Business machinery Manufacture of electronic parts, Manufacture of lumber and wood products Manufacture of leather tanning, leather products Lumber Leather devices Electronics (except furniture) and fur skins and electronic circuits Manufacture of electrical machinery, Manufacture of furniture and fixtures Furniture Manufacture of ceramic, stone and clay products Ceramics Electrical equipment and supplies Manufacture of pulp, paper and paper Paper and Manufacture of information and Manufacture of iron and steel Iron and steel Information products pulp communication electronics equipment Manufacture of transportation Printing and allied industries Printing Manufacture of non-ferrous metals and products Non-ferrous Transportation equipment Manufacture of chemical and allied products Chemicals Manufacture of metal products Metals Other manufacturing Other
26 3 Industrial Structure of the Tohoku Region
(iii) Shares of Industry Sectors by Year and Prefecture
The industry sectors of electronic parts, devices and electronic circuits; food; and transportation equipment rank high in the value of manufactured goods shipped in the Tohoku region.
●In 2018, out of the 24 manufacturing industry sectors in the Tohoku region, six sectors (electronic parts, devices and electronic circuits; food; transportation equipment; production machinery; information and communication electronics equipment, and chemical and allied products) accounted for about 50% of the value of manufactured goods shipped in the Tohoku region. The share of production machinery was increasing.
Yearly Changes in the Share of Industry Sectors by Value of Manufactured Goods Shipped in the Tohoku Region
(%) 0 20 40 60 80 100
2010 12.8 11.5 7.4 4.4 11.1 5.5 4.33.6 4.2 4.6 3.3 3.3 3.8 3.1 17.1
2011 12.9 11.1 8.3 5.6 11.1 5.5 4.5 4.2 4.6 4.8 3.2 3.2 2.9 17.0 1.1
2012 9.9 10.8 10.5 5.2 8.6 5.6 4.4 4.0 4.1 4.6 3.8 3.5 3.6 3.4 18.0
2016 13.2 11.9 10.8 5.8 5.8 6.0 4.5 3.8 4.3 4.3 2.9 3.6 3.4 2.7 17.0
2017 13.5 11.7 10.7 6.9 5.5 5.8 4.5 3.7 4.0 4.2 2.9 3.4 3.3 2.8 17.1 Manufacturing
Non- Paper Iron Electronics Food Transportation Production Information Chemicals Metals Business Electrical Petroleum Ceramics Other 2018 ferrous and pulp and steel 12.7 11.7 10.8 7.4 5.6 5.5 4.6 4.1 3.9 3.7 3.4 3.4 3.3 3.1 16.8
Note: The figures for the industry sector of information and telecommunications equipment in 2016, 2017 and 2018 are totals of five prefectures except for Aomori to conceal the individual data of its surveyed manufacturer(s). Source: Economic Census for Business Activity (business establishments with 4 or more employees) and Census of Manufacture (business establishments with 4 or more employees)
●The industry sectors with the largest share in each prefecture were as follows: food in Aomori, transportation equipment in Iwate, food in Miyagi, electronic parts, devices and electronic circuits in Akita and Yamagata, and information and communication electronics equipment in Fukushima.
Shares of Industry Sectors by Value of Manufactured Goods Shipped in Each of the Six Tohoku Prefectures (2018)
(%) 0 20 40 60 80 100
0.4 Aomori 16.7 21.5 3.1 2.5 2.0 3.2 7.5 3.8 13.6 5.72.6 5.9 11.5
1.7 0.8 0.4 Iwate 7.1 14.2 25.0 10.7 2.1 4.9 4.2 2.1 4.0 2.0 3.7 17.1
Miyagi 11.3 14.1 11.7 9.8 3.0 4.2 3.4 2.8 12.4 3.9 4.1 13.9 1.8 1.9 1.7
Akita 29.4 8.4 5.5 9.4 3.8 5.2 6.5 4.4 3.3 2.9 16.5 0.7 2.0 0.5 1.5
0.2 1.1 Yamagata 16.4 11.5 4.7 9.6 10.4 9.1 3.8 5.4 3.6 19.3 2.0 2.1 0.8
Non- Paper Iron Electronics Food Transportation Production Information Chemicals Metals Business Electrical Ceramics Other Fukushima ferrous and pulp and steel 9.0 6.0 9.9 3.5 10.6 10.1 5.6 5.4 5.1 4.4 3.8 3.9 2.3 20.1 Petroleum 0.3 Note: The following industry sectors make up only a small percentage in the Tohoku region compared to other sectors and are therefore classified as “Other”: They include beverages, tobacco and feed; textile products; lumber and wood products; furniture and fixtures; printing and allied industries; plastic products; rubber products; leather tanning, leather products and fur skins; general-purpose machinery; and other manufacturing. For Aomori, the industry sector of telecommunications equipment was included and totaled in the group of “Other” to conceal the individual data of its surveyed manufacturer(s). Source: Census of Manufacture (business establishments with 4 or more employees)
27 Industrial Structure of the Tohoku Region 3
(iv) Value of Manufactured Goods Shipped from Major Industry Sectors and Value-added Productivity by Region
The food manufacturing industry, transportation machinery and equipment manufacturing industry, production machinery and equipment manufacturing industry are the highest ever.
●In 2018, the value of manufactured goods shipped in the Tohoku region exceeded that in 2010 for all five out of the top six industry sectors before the Great East Japan Earthquake. The shipment value of the food manufacturing industry, the transportation machinery and equipment manufacturing industry, and the production machinery and equipment manufacturing industry reached record highs.
Changes in the Value of Shipments in Major Industry Sectors
(Trillion of yen) 3.0
2.5 Electronics 2.36 2.09 Food 2.19 2.0 1.88 Trans- portation 2.01 1.82
1.5 Production 1.20 1.38 Information 0.90 1.05 1.0 Chemicals 1.02
0.71
0.5 Manufacturing
Electronics Food Transportation Production Chemicals Information
0.0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Note: The figures for the industry sector of information and telecommunications equipment in 2016, 2017 and 2018 are totals of five prefectures except for Aomori to conceal the individual data of its surveyed manufacturer(s). Source: Economic Census for Business Activity (business establishments with 4 or more employees) and Census of Manufacture (business establishments with 4 or more employees)
● In 2018, value-added productivity in the Tohoku region was 10.4 million yen per capita, while that in Japan was 13.41 million yen per capita. Compared to Japan (= 100), Tohoku’s productivity corresponds to the level of 77.6, exceeding the level of 76.5 in 2010 before the year of the Great East Japan Earthquake. (cf. 68.8 in 2011).
Value-added Productivity by Region (Manufacturing Industry Total)
(Ten thousands of yen per capita) 1,600
1,400 1,341
1,220 1,183 1,200 1,077 1,092 1,050 1,046 1,040 1,000 959 911 938 905 804 832 800 716 713 2010 2018 600
400
200
0 Aomori Iwate Miyagi Akita Yamagata Fukushima Tohoku Japan Note: Value-added productivity is the value-added amount per employee (Ten thousands of yen per capita). The number of employees as of June 1, 2019 was used to calculate the value-added productivity of 2018. Source: Census of Manufacture (business establishments with 4 or more employees)
28 3 Industrial Structure of the Tohoku Region
(v) Manufacturing Companies Headquartered in the Tohoku Region
Profit margin declines, total capital per company increases, and R&D expense ratio to sales rises.
●Number of business establishments and regular employees per company In FY 2018, manufacturing companies headquartered in the Tohoku region (773 companies) had, on average, 3.674 business establishments, including plants/factories and sales offices (a 2.4% increase year-on-year); 246.7 regular employees (a 1.3% increase year-on-year ); 8.282 billion yen in sales (a 0.2% decrease year-on-year); and 0.671 subsidiaries (a 5.4% decrease year-on-year) per company.
Changes in the Number of Business Establishments, Regular Employees, Sales, and Subsidiaries per Manufacturing Company (Index is based on the value for FY 2008 as 100)
120.0
115.0 113 6 110.0 108 8 106.1 105.0
100.0 99.7
95.0
90.0
85.0
80.0 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
No. of establishments No. of regular employees Sales No. of subsidiaries Manufacturing
Number of Business Establishments and Other Indicators per Manufacturing Company
No. of business establishments No. of regular employees Sales (Hundred millions of yen) No. of subsidiaries Tohoku Japan Tohoku Japan Tohoku Japan Tohoku Japan FY 2016 3.455 5.867 238.7 409.1 81.59 210.8 0.738 4.032 FY 2017 3.587 5.978 243.5 417.7 83 01 225.2 0.710 4.128 FY 2018 3.674 5.965 246.7 415.4 82.82 227.9 0.671 3.946 Fiscal YoY 2.4 -0.2 1.3 -0.6 -0.2 1.2 -5.4 -4.4 change (%)
Note: The Basic Survey of Japanese Business Structure and Activities applies to companies with 50 or more employees and a capital amount or equity investment amount of 30 million yen or more. Source: Basic Survey of Japanese Business Structure and Activities, Ministry of Economy, Trade and Industry
●Ratio of operating income to sales The ratio of operating income to sales for manufacturing companies headquartered in the Tohoku region was 3.67% (a 0.60 percentage point decrease year-on-year), while the ratio of ordinary income to sales was 4.06% (a 0.60 percentage point decrease year-on-year) and the ratio of net income to sales was 2.84% (a 1.24 percentage point decrease year-on-year).
Changes in Ratios of Operating Income, Ordinary Income and Net Income to Sales in Manufacturing Companies (%) 6.0 5.0 4.70 4.66 4.01 4.27 4.06 4.0 3.37 3 59 3.67 2.94 2 95 2.78 4.09 3.0 3.70 2.30 2.66 3 31 2.84 1.77 1.70 2.0 2.73 2 57 2.46 2.26 1.79 0.44 1.97 1.0 1 50 1.34 1 21 1.11 0.0 0.79 0 32 0.24 -0.07 -1.0 -0 08 -2 23 Ratio of operating Ratio of ordinary Ratio of net -2.0 income to sales income to sales income to sales -3.0 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 Source: Basic Survey of Japanese Business Structure and Activities, Ministry of Economy, Trade and Industry
29 Industrial Structure of the Tohoku Region 3
●Shareholders’ equity ratio Manufacturing companies headquartered in the Tohoku region had total capital (total assets) per company of 9.196 billion yen (a 3.5% increase year-on-year), net assets of 3.47 billion yen (a 3.0% increase year-on-year), and equity ratio of 37.7% (a decrease in 0.2 percentage point from the previous year).
Changes in Total Capital (Total Assets) per Company and Equity Ratio in Manufacturing Industry
(Hundred millions of yen) (%) 120 37 9 37.7 40.0 33.5 34.5 110 32.5 35.0 30.5 31 3 Equity ratio 28.7 28.3 100 (right axis) 25.8 30.0 24.4 91.96 90 88.87 25.0 93.22 84.78 86.54 86.16 85 09 83.79 83.72 80 74.48 75 63 20.0 70 15.0 Total 60 capital 10.0 per 50 company 5.0 40 0.0 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
Average Ratio of Operating Income to Sales and Other Indicators per Company in the Manufacturing Industry
Ratio of operating Ratio of ordinary income Ratio of net income to Total capital (Hundred Net assets (Hundred Equity ratio (%) income to sales (%) to sales (%) sales (%) millions of yen) millions of yen) Tohoku Japan Tohoku Japan Tohoku Japan Tohoku Japan Tohoku Japan Tohoku Japan FY 2016 3.31 4.74 3.59 6.94 4.70 4.66 83.72 260.9 28.88 130.2 34.5 49.9 FY 2017 4.27 5.46 4.66 7.73 4.09 5.79 88.87 275.8 33.68 140.3 37.9 50.9 FY 2018 3.67 4.81 4.06 7.27 2.84 5.20 91.96 275.4 34.70 141.7 37.7 51.4 Fiscal YoY -0.60 -0.65 -0.60 -0.46 -1.24 -0.59 3.5 -0.1 3 0 1.0 -0.2 0.6 change Manufacturing Note 1: Fiscal YoY change for total capital and net assets represents the change from the previous fiscal year (%). Note 2: Equity ratio = Net assets (Equity)/Total capital. Generally, he higher the ratio, the smaller the liabilities of a company. Source: Basic Survey of Japanese Business Structure and Activities, Ministry of Economy, Trade and Industry
●Research and Development (R&D) Of the 773 manufacturing companies headquartered in the Tohoku region, 197 companies reported their R&D expenses, representing 25.5% of the total (cf. 48.0% for Japan). R&D expenses-to-sales ratio was 3.01% (a 0.13 percentage point increase year-on-year). R&D expenses per company were 476.2 million yen (a 0.4% increase year-on-year).
Changes in the R&D Expenses-to-Sales Ratio and the R&D Expenses per Company in the Manufacturing Industry
(Millions of yen) (%) 800 3 63 3.50 3.48 4.0 3.14 700 3.04 3.01 3.5 R&D expenses-to-sales ratio 2.97 2 88 575.6 600 (right axis) 562.7 557.8 3.0 2.43 519.1 2.44 474.4 476.2 500 444.7 2.5 371.1 400 342.1 1 62 359.7 2.0 300 1.5 R&D 191.6 200 expenses 1.0 per company 100 0.5 0 0.0 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
R&D Expenses in Manufacturing Companies
No. of companies that reported to the No. of companies that reported their R&D expenses Ratio of R&D R&D expenses per Basic Survey of Japanese Business Tohoku Japan expenses to sales (%) company (millions of yen) Structure and Activities No. of Response No. of Response Tohoku Japan Tohoku Japan Tohoku Japan companies ratio (%) companies ratio (%) FY 2016 802 12,870 204 25.4 6,161 47 9 3.14 5.04 519.1 1,856.7 FY 2017 768 12,705 195 25.4 6,174 48.6 2.88 5.02 474.4 1,971.2 FY 2018 773 12,826 197 25.5 6,160 48 0 3.01 4.83 476.2 1,943.7 Fiscal YoY 5 121 2 0.1 -14 -0.6 0.13 -0.19 0.4 -1.4 change
Note: Fiscal YoY change in R&D expenses per company represents the change from the previous fiscal year (%). Source: Basic Survey of Japanese Business Structure and Activities, Ministry of Economy, Trade and Industry
30
3 Industrial Structure of the Tohoku Region
(vi) Industrial Property Rights
The number of applications for industrial property rights is increasing for patents and trademarks, while it is decreasing for utility models and designs.
●The number of applications for industrial property rights made in 2019 in the Tohoku region was 1,814 for patents, 87 for utility models, 385 for designs, and 2,790 for trademarks, with a year-on-year increase in patent and trademark applications, and a year-on-year decrease in utility model and design applications. ●The number of patents has increased for the second consecutive year, the number of utility models has been decreasing since 2016, and the number of designs and trademarks has been increasing recently. ●Compared to the previous year, the number of applications by prefecture increased for patents in 5 prefectures other than Yamagata, increased for utility models in Aomori, increased for designs in Akita and Yamagata, and increased for trademarks in all 6 prefectures.
Changes in the Number of Patent Applications Changes in the Number of Utility Model Applications
(Applications) 0.74 (%) (Applications) (%) 2,500 Share of the national total 0.75 300 4.20 0 68 (right axis) 0.68 0.66 0.65 3.63 0.63 Share of the national total (right axis) 3.37 250 3.50 2,000 0 60 3.10 3.15 1,816 1,814 1,719 1,713 2.78 Aomori 1,690 1,648 367 200 189 2.80 Iwate 183 2.36 1,500 341 0.45
Manufacturing Aomori 136 129 Iwate 142 150 137 2.10 Miyagi 120 1,000 705 0 30 Miyagi 9 692 14 100 87 1.40 Akita 11 Akita 46 8 500 90 136 0.15 Yamagata 50 Yamagata 35 233 210 14 0.70 12 5 Fukush ma 10 Fukushima 228 260 25 18 0 0 00 0 0.00 2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019
Changes in the Number of Design Applications Changes in the Number of Trademark Applications
(Applications) (%) (Applications) (%) 600 1.66 1.68 1 80 4,000 2.40 1.60 Share of the national total 2.14 Share of the national total (right axis) (right axis) 3,500 1.95 2.10 500 1 50 1.87 1.87 1.29 1 73 1.19 3,000 1.64 2,790 1 80 397 389 385 400 1.06 1 20 2,500 2,514 288 2,500 2,535 Aomori 53 34 2,302 227 1 50 314 26 2,141 348 Iwate 293 29 322 2,000 Aomori 300 264 0 90 1 20 150 Iwate 958 829 Miyagi 161 1,500 0 90 200 0 60 Miyagi 13 1,000 220 240 0 60 Akita 12 Akita 377 378 100 Yamagata 62 114 0 30 500 Yamagata 0 30 539 578 Fukush ma 72 48 Fukushima 0 0 00 0 0 00 2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019
Source: Japan Patent Office Annual Report, Japan Patent Office
31 Industrial Structure of the Tohoku Region 3
(2) Commerce
(i) Overview
For both wholesale and retail trades, the number of business establishments and employees has decreased, but show an increase in annual sales.
●The GRDP for commerce in the Tohoku region increased 2.1% year-on-year to 3,827.6 billion yen for the first time in two years in FY 2017. ● The share of commerce in all-industry GRDP (nominal) was 11.1%, an increase of 0.1 points from the previous year. ●The total production value by prefecture increased year-on-year in 5 prefectures other than Fukushima prefecture.
Changes in Nominal GRDP for Commerce (Wholesale and Retail Trade)
(Hundred millions of yen) (%)
50,000 11 5 11.5 11 6 11.6 11.6 11.4 12 11.1 11.2 11.2 11.0 11.1
Share of commerce (right axis) 40,000 38,256 38,276 10 37,155 37,130 37,968 37,474 36,013 35,795 34,346 Aomori 33,741 33,862 5,356 5,371
30,000 Iwate 4,729 4,874 8
Miyagi 12,331 12,964
20,000 6 Commerce
Akita 3,597 3,703 10,000 4 Yamagata 4,319 4,395
Fukushima 7,143 6,969 0 2 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 Source: Annual Report on Prefectural Accounts
●In 2016, the total number of wholesale and retail establishments in the Tohoku region was 107,899 (down 2.8% from the 2014 survey; that of Japan also declined 3.7% during the same period), while the number of employees declined to 765,337 (down 1.4% from the 2014 survey; down 0.2% for Japan). Total annual sales of goods stood at 28,916.2 billion yen (up 17.9% from the 2014 survey; up 21.5% for Japan). ● For both wholesale and retail trades, the number of business establishments and employees decreased with an increase in annual sales.
Changes in the Number of Business Establishments, Number of Employees, and Annual Sales of Goods
Annual sales of goods (*Sales during the calendar No. of business establishments No. of employees year immediately preceding the year of the survey) Share of Changes from the Share of Changes from the Share of Changes from the national previous census (%) national previous census (%) (Millions of yen) national previous census (%) total (%) Tohoku Japan total (%) Tohoku Japan total (%) Tohoku Japan 2014 111,008 7.9 - - 776,029 6.7 - - 24,528,243 5.1 - - Commerce total 2016 107,899 8.0 -2.8 -3.7 765,337 6.6 -1.4 -0.2 28,916,184 5.0 17.9 21.5 2014 27,511 7.2 - - 220,524 5.6 - - 15,545,466 4.4 - - Wholesale 2016 26,654 7.3 -3.1 -4.6 217,845 5.5 -1.2 0.2 18,596,674 4.3 19.6 22.4 2014 83,497 8.1 - - 555,505 7.2 - - 8,982,777 7.4 - - Retail 2016 81,245 8.2 -2.7 -3.4 547,492 7.2 -1.4 -0.4 10,319,509 7.1 14.9 18.8
Note 1: The number of business establishments and the number of employees were as of July 1, 2014 and as of June 1, 2016, respectively. Note 2: Changes from the previous census in the number of business establishments, number of employees, and annual sales of goods are based on comparison between 2014 and 2016. Note 3: Total annual sales refer to the sales of goods during the calendar year immediately preceding the year of the survey. Note 4: The business establishments include those that engaged in administrative or ancillary economic activity, those that could not be categorized by minor groups, those that had no sales for wholesale goods (except for commission fees), and those that had no sales for retail goods and no commission fees. Source: 2016 Economic Census for Business Activity, Aggregation by Industry Group (Wholesale and Retail Trades) Table 1 32 Industrial Structure of the Tohoku Region 3
(2) Commerce
(i) Overview
For both wholesale and retail trades, the number of business establishments and employees has decreased, but show an increase in annual sales.
●The GRDP for commerce in the Tohoku region increased 2.1% year-on-year to 3,827.6 billion yen for the first time in two years in FY 2017. ● The share of commerce in all-industry GRDP (nominal) was 11.1%, an increase of 0.1 points from the previous year. ●The total production value by prefecture increased year-on-year in 5 prefectures other than Fukushima prefecture.
Changes in Nominal GRDP for Commerce (Wholesale and Retail Trade)
(Hundred millions of yen) (%)
50,000 11 5 11.5 11 6 11.6 11.6 11.4 12 11.1 11.2 11.2 11.0 11.1
Share of commerce (right axis) 40,000 38,256 38,276 10 37,155 37,130 37,968 37,474 36,013 35,795 34,346 Aomori 33,741 33,862 5,356 5,371
30,000 Iwate 4,729 4,874 8
Miyagi 12,331 12,964
20,000 6 Commerce
Akita 3,597 3,703 10,000 4 Yamagata 4,319 4,395
Fukushima 7,143 6,969 0 2 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 Source: Annual Report on Prefectural Accounts
●In 2016, the total number of wholesale and retail establishments in the Tohoku region was 107,899 (down 2.8% from the 2014 survey; that of Japan also declined 3.7% during the same period), while the number of employees declined to 765,337 (down 1.4% from the 2014 survey; down 0.2% for Japan). Total annual sales of goods stood at 28,916.2 billion yen (up 17.9% from the 2014 survey; up 21.5% for Japan). ● For both wholesale and retail trades, the number of business establishments and employees decreased with an increase in annual sales.
Changes in the Number of Business Establishments, Number of Employees, and Annual Sales of Goods
Annual sales of goods (*Sales during the calendar No. of business establishments No. of employees year immediately preceding the year of the survey) Share of Changes from the Share of Changes from the Share of Changes from the national previous census (%) national previous census (%) (Millions of yen) national previous census (%) total (%) Tohoku Japan total (%) Tohoku Japan total (%) Tohoku Japan 2014 111,008 7.9 - - 776,029 6.7 - - 24,528,243 5.1 - - Commerce total 2016 107,899 8.0 -2.8 -3.7 765,337 6.6 -1.4 -0.2 28,916,184 5.0 17.9 21.5 2014 27,511 7.2 - - 220,524 5.6 - - 15,545,466 4.4 - - Wholesale 2016 26,654 7.3 -3.1 -4.6 217,845 5.5 -1.2 0.2 18,596,674 4.3 19.6 22.4 2014 83,497 8.1 - - 555,505 7.2 - - 8,982,777 7.4 - - Retail 2016 81,245 8.2 -2.7 -3.4 547,492 7.2 -1.4 -0.4 10,319,509 7.1 14.9 18.8
Note 1: The number of business establishments and the number of employees were as of July 1, 2014 and as of June 1, 2016, respectively. Note 2: Changes from the previous census in the number of business establishments, number of employees, and annual sales of goods are based on comparison between 2014 and 2016. Note 3: Total annual sales refer to the sales of goods during the calendar year immediately preceding the year of the survey. Note 4: The business establishments include those that engaged in administrative or ancillary economic activity, those that could not be categorized by minor groups, those that had no sales for wholesale goods (except for commission fees), and those that had no sales for retail goods and no commission fees. Source: 2016 Economic Census for Business Activity, Aggregation by Industry Group (Wholesale and Retail Trades) Table 1 32 3 Industrial Structure of the Tohoku Region
(3) Service Industry
The GRDP in the service industry in the Tohoku region has increased for the sixth consecutive year.
●The GRDP for the service industry in the Tohoku region in FY 2017 was 19,815.3 billion yen, an increase of 0.5% from the previous year, and the sixth consecutive year of increase. ●The share of the service industry in all-industry GRDP (nominal) decreased 0.3 percentage points year-on-year to 57.6%, showing a continuous gradual decrease since fiscal year 2010.
Changes in Nominal GRDP for the Service Industry
(Hundred millions of yen) (%) 300,000 70.0
62 2 61 2 61.5 61.3 60.3 59 6 59 3 58.8 250,000 58 2 57 9 57.6 60.0
Share of the service industry (right axis) 197,857 196,506 197,179 198,153 200,000 191,272 188,993 189,208 192,414 50.0 186,509 181,638 186,364 Aomori 27,137 27,302
Iwate 25,901 26,104 150,000 40.0
Miyagi 54,508 54,798 100,000 30.0
Akita 22,117 23,302
Service Industry Yamagata 22,641 22,903 50,000 20.0
Fukushima 44,875 44,745 0 10.0 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 Note: The service industries in the above graph include electricity, gas and water supply, and waste management service; transport and postal services; accommodation and food service activities; telecommunications; finance and insurance; real estate; specialized, scientific and technical activities; business support service activities; public administration; education; human health and social work activities; and other service activities. Source: Annual Report on Prefectural Accounts
●The number of service industry employees in the Tohoku region (as of June 1, 2016) was 1.9 million. By industry (major group category), 25.7% worked in “medical, healthcare and welfare,” followed by “accommodations, eating and drinking services” at 16.5%, and “services, n. e. c.” at 15.0%. ●Compared to Japan, the Tohoku region has a large share of employees in “medical, healthcare and welfare” and a small share in “telecommunications.”
Breakdown of Employees Engaged in Service Industries by Major Group Category
(%) 0 10 20 30 40 50 60 70 80 90 100
Information and communications Real estate, and goods rental and leasing
Transport Finance Accommodations, Living-related and Education personal services Medical, 2.4 and and eating and drinking learning and amusement healthcare and welfare Services (n e.c.) 1.9 million Tohoku postal services insurance 3.8 4.6 services support 2.5 services 15.0 people 0.9 10.5 4.7 16.5 8.5 5 0 25.7 Electricity, gas, heat supply and water Scientific research, professional and technical services Compound services
32.1 million Japan 5.1 10.0 4.8 4.6 5.7 16.7 7.5 5.7 23 0 1.5 14 8 people 0.6
Note: The service industries in the above graph refer to the major group categories of industries in the Japan Standard Industry Classification (revised in October 2013), from "Division F - Electricity, gas, heat supply and water" to "R - Services, n. e. c." The graph excludes employees engaged in "I - Wholesale and retail trade." Source: 2016 Economic Census for Business Activity
33 Industrial Structure of the Tohoku Region 3
(4) Agriculture, Forestry, and Fisheries
The value of output for agriculture and forestry rises, while that for marine fisheries and aquaculture declines.
●The number of agricultural management entities in the Tohoku region in 2015 was 247,713, a decrease of 21.0% from the 2010 survey (cf. a decrease of 18.0% for Japan), and that of forestry management entities in 2015 was 15,175, a decrease of 42.9% from the 2010 survey (cf. a of 37.7% for Japan), while the number of fishery management entities in the Tohoku region in 2018 numbered 10,727, a decrease of 5.1% from the 2013 survey (cf. a decrease of 16.3% for Japan).
Agricultural, Forestry and Fishery Management Entities
Agricultural management entities Forestry management entities Fishery management entities Japan 2010: 1,679,084 2015: 1,377,266 Japan 2010: 140,186 2015: 87,284 Japan 2013: 94,507 2018: 79,067 Tohoku 2010: 313,415 2015: 247,713 Tohoku 2010: 26,569 2015: 15,175 Tohoku 2013: 11,308 2018: 10,727 0 20,000 40,000 60,000 80,000 0 2,000 4,000 6,000 8,000 10,000 0 1,000 2,000 3,000 4,000 5,000
Aomori 44,667 Aomori 3,071 Aomori 4,501 35,914 2,059 3,702
Iwate 57,001 Iwate 8,795 Iwate 3,365 46,993 4,979 3,406
Miyagi 50,741 Miyagi 2,129 Miyagi 2,311 38,872 1,373 2,326
Akita 48,521 Akita 4,894 Akita 758 38,957 2,726 632 40,831 2,751 359 Yamagata Yamagata Yamagata 33,820 1,317 284 Agriculture, Forestry, and Fisheries
Fukushima 71,654 Fukushima 4,929 Fukushima 14 53,157 2,721 377
2010 2015 2010 2015 2013 2018 Source: Census of Agriculture and Forestry (as of February 1 each year) and Census of Fisheries (as of November 1 each year)
●In 2018, the value of output for agriculture in the Tohoku region was 1,432.5 billion yen. It is 15.7% of the national total of 9,128.3 billion yen for agriculture. Its share increased 0.8 percentage points year-on-year. Rice had the largest share in the value of agricultural output in the Tohoku region at 32.3% with 462.2 billion yen, followed by livestock products (at 31.0%, 444.5 billion yen.)
Changes in the Agricultural Output and Share of the National Total
(Hundred millions of yen) (%) 20,000 18.0 Share of the national total (right axis) 15.7 15.7 15.7 18,000 15 2 15.1 15.4 15 3 16.0 14.6 14.9 14.9 14.9 16,000 Other Industrial crops 14.0 14,325 13,599 13,885 14,001 193 14,000 13,088 13,296 13,092 13,169 191 12,526 12,571 12,298 12.0 12,000 4,445 Livestock 4,590 products 10.0 10,000 112 Flowering 125 plants 251 8.0 Fruits 2,016 254 8,000 and nuts 1,937 6.0 Vegetables 6,000 2,458 2,683 4.0 4,000
Rice 4,622 2,000 4,449 2.0
0 0.0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Source: Pocket Tohoku Agriculture, Forestry and Fisheries Statistics Annual Report, and 66th Tohoku Agriculture, Forestry and Fisheries Statistics Annual Report (2018 - 2019); Tohoku Regional Agricultural Administration Bureau
34 3 Industrial Structure of the Tohoku Region
●In 2018, the value of forestry output in the Tohoku region was 71.12 billion yen. It is 15.4% of the national total of 462.85 billion yen for forestry. Its share increased 0.1 percentage points year-on-year. By commodity, timber production was 49.55 billion yen, accounting for 69.7% of the forestry output in the Tohoku region. Cultivated mushroom production was 20.18 billion yen, 28.4% of the forestry output in the Tohoku region.
Changes in the Forestry Output and Share of the National Total (%) (Hundred millions of yen) 20.0 Share of the national total (right axis) 17 0 17.4 1,000 18.0 16 2 16.416.4 16.216.2 15.9 15.8 15 5155 15.3 15.4 14.614.6 16.0 Other 800 762.1 753.0753.0 14.0 711 2 705 6 692 8 696.5 689 2 666 56665 682.5682.5 7.97.9 7.17.1 12.0 Cultured 606 8 602.6602.6 600 mushrooms, 201 82018 etc. 215 52155 10.0 6.06.0 Fuelwood 6.96.9 and charcoal 8.0 400 6.0 495 54955 Logs 459.7459.7 4.0 200 output
2.0
0.0 0
Agriculture, Forestry, and Fisheries 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Source: Forestry Output, Ministry of Agriculture, Forestry and Fisheries
●In 2018, the value of output for marine fisheries and marine aquaculture in the Tohoku region was 186.5 billion yen. It is 13.1% of the national total of 1,423.8 billion yen. Its share of the national total decreased 0.8 percentage points year-on-year. Specifically, the value of output for marine fisheries was 140.9 billion yen, followed by marine aquaculture with 45.6 billion yen.
Changes in the Value of Output for Marine Fisheries and Marine Aquaculture and Share of the National Total
(Hundred millions of yen) (%) 16.0
13.6 14.1 Share of the national total (right axis) 2,500 13.613.6 13.9 13.2 13.1 14.0 12.3 11.7 2,099 2,027 1,951 11 0110 12.0 2,000 1,907 1,942 1,865 Marine 10.110.1 1,8301,830 aquaculture 9 595 1,648 563563 10.0 456456 1,4841,484 1,500 1,346 1,265 8.0
6.0 1,000 Marine fisheries 1,4641,464 1,4091,409 4.0 500 2.0
0.0 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Note: The figures for 2008 and 2009 are the totals except for Akita, Yamagata and Fukushima to conceal the individual data of their surveyed marine aquaculture producer(s). The figures for 2010 are the totals except for Akita and Yamagata to conceal the individual data of their surveyed marine aquaculture producer(s). The figures for 2011, 2012 and 2013 are the totals except for Yamagata and Fukushima to conceal the individual data of their surveyed marine aquaculture producer(s). The figures for 2014 and 2015 are the totals except for Yamagata to conceal the individual data of its surveyed marine aquaculture producer(s). The figures for 2016 are the totals except for Yamagata to conceal the individual data of its surveyed marine fishery and marine aquaculture producer(s). Source: Fishery Output, Ministry of Agriculture, Forestry and Fisheries
35 2020 ECONOMIC OVERVIEW OF TOHOKU REGION
Tohoku Bureau of Economy, Trade and Industry