Young and bored during Golden Week

By Terrie Lloyd

Here we are at the start of what normally for many is one of their longest holiday breaks—Golden Week. But not this year—as neither of the two weeks that the holidays occur in provides workers more than two days off. Normally, the four days: Showa Day, Constitution Day, Greenery Day and Children’s Day would generate a string of holidays up to 7-8 days long, but because this year two of the days fall on the weekend, we only get a single compensation day on Tuesday, May 6. Next year is better, we get five consecutive days.

This hasn’t deterred a number of traditional companies from going ahead and giving their employees some extra time off—so next week it will be hard to order anything from
factories or service companies. We know because we just tried to get a new TV installed. No way Jose, we’ll have to wait until at least May 7 or 8—10 days from now.

But while some lucky workers are getting a couple of bonus days off, most are not. This is apparently the main reason why the number of tourists expected to travel overseas this Golden Week is likely to fall almost 15% from last year, to 458,000 people. This is the biggest drop since 2003, when SARS scared everyone into staying home. SARS, of course, is just a faded memory (other than for the government which has a stock pile of 35 million doses of Tamiflu), and this year, 269,000 people will still make the pilgrimage to Hong Kong, South Korea, and/or China.

But it seems that there are other factors besides the scattered nature of the holidays which are keeping the Japanese at home during Golden Week, 2008.

As far as Asia is concerned, the Japanese are a relatively peripatetic nation, with around 17 million people making overseas trips and 22 million taking domestic holidays in 2007. This is
equivalent to 32% of all its citizens taking a holiday away from home at least once a year. Golden Week is a particularly important travel period economically. Destinations like Hawaii receive about 458,000 Japanese tourists a year, and about 1/3 of them travel during Golden
Week, spending an average $269 a day, almost double the $169 Americans from the mainland spend.

Those who don’t go overseas instead journey to Tokyo and other major centers to shop. Last year, 1.5 million people visited the new Tokyo Midtown shopping/office complex in Roppongi. Department stores such as Daimaru saw shopper numbers rise by around 12%. Taxi company Nihon Kotsu had its fare earnings increase by 1,300 yen per cab, due to customers making round trips to Haneda airport and the city. In Osaka, sales at the Namba Parks entertainment
complex soared 170%.

Some of the reasons that JTB, Japan’s largest travel agency, is giving for the international tourist drop-off this year include the higher fuel surcharges, adding up to 10% to ticket prices; the Chinese gyoza food scare; and just the simple lack of holiday budget by families and younger people who have historically flocked to Hawaii and other international destinations.

This last point is in our minds probably the biggest factor affecting travel statistics in general—not just international travel. Although one would think that the 13% revaluation of the yen versus the dollar would make Hawaii and similar dollar-tied destinations a lot more attractive,
it seems that the cloud of pessimism which has been hanging over the Japanese economy since the subprime news started breaking last summer, is still very much affecting the
moods of both employers and workers alike.

As polls are showing, the average Japanese appears to be very concerned about their overall future—the Cabinet Office’s March consumer confidence poll showed that just 36.5% of households in the period January-March were confident about the future, the lowest level of confidence since June 2003, when it was 36.1%. A reading of less than 50% indicates a general mood of pessimism in the nation. So, perhaps it is natural that people are less likely than ever to want to lay out thousands of dollars on a trip when doing so might create a shortfall in their budget if the prices continue to rise.

And this is not a new trend. Overseas travel has dropped each year over the last two years, and has only just barely retraced the levels of pre-SARS 2002. However, whereas in
previous years falling international travel was offset by local visits to onsen and tourist spots around the country, this year JTB is also forecasting a slight drop in domestic tourists, to 21.44m people. Gunma reckons its visitor numbers to onsen this year will be down around 5%.

The feeling of pessimism (or realism?) is nowhere more pronounced than among young adults in their 20s. While in 1996, around 4.63 million people in this age group traveled overseas, in 2006, only 2.98m did—a fall of 35.7%. This huge drop can be explained by simple economics. Although the job market is tight, companies are not opening their purse strings to employees—they’re scared too, and thus real income for workers in their 20s has dropped almost yearly since 2001. Recent inflation is speeding up this deficit. JTB says the average Japanese tourist spends about 214,000 yen on an overseas trip, and that is several
thousand dollars more than a worried single is prepared to pay. Indeed, the Statistics Bureau gives the average 2006 disposable income of under-34s, who have their own apartment as being just barely more than 20,000 yen per month—hardly enough to do any travel on.

As a result, not just travel, but other forms of spending such as autos and alcohol have also dropped. According to a recent Nikkei article, the Japan Automobile Manufacturers Association says that the ratio of cars owned by young men in their 20s dropped from 81% in 1995 to 74% in 2005. Another survey found that single males 34 years or younger were last year spending 26% less on alcohol then they did in 2002.

So is there a silver lining to a slow golden holiday period? It seems there is. In 2002, the number of people killed in Golden Week accidents was 224, while last year, just five years later, 119 died this way. More notable was the fact that only 12 people died through drunk-driving accidents versus 29 in 2007.

Japan’s youth appear to becoming a generation of worried, sober bicycle and train riders, who stay at home or meet friends during Golden Week.

Terrie Lloyd writes a weekly newsletter for entrepreneurs and business people about business and political opportunities in Japan. You can find the newsletter at www.japaninc.com. For further contact with Terrie, email him at terrie.lloyd@japaninc.com.

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9 Comments

evil_robot at 10:41 AM JST - 29th April

Adding up to 10% to their air fare? Ha! Try adding up to 50% in addition to their air fare. Those lies you see printed in the travel ads stating "30,000 yen to Hong Kong!" always win up being 52,000 yen or something similar. If you want to leave this country, be prepared to unload everything you have on some lying travel or tour agency.
Scrote at 11:08 AM JST - 29th April

evil_robot: Spot on about the taxes and surcharges. I automatically add Y50000 to any fare to get a rough estimate of the true price.

I've also given up on the travel agencies because the random numbers in their ads bear no relation to the final fare, even in the unlikely event that the advertised fare is available.

Nowadays I book directly with the airlines, which is usually a bit cheaper than the agents.
Sarge at 11:38 AM JST - 29th April

"Destinations like Hawaii receive about 458,000 Japanese tourists a year, and about 1/3 of them travel during GW"

I wonder if this has anything to do with my friend in the mainland U.S. being unable to reserve a hotel room in Honolulu in late April a few years ago.
timeon at 12:34 PM JST - 29th April

Nowadays I book directly with the airlines, which is usually a bit cheaper than the agents.

exactly what I realized this year (for going to Europe in summer). I would ad another reason for not traveling in GW: it's damn crowded! so for me it's sleeping, finishing some stuff and work and drinking
jpdrag0n at 11:55 PM JST - 29th April

very true. i have no plans for golden week and neither do any of my friends. :(
pathat at 12:10 AM JST - 30th April

Golden Week just does not live up to its name.
DeepAir65 at 11:49 AM JST - 30th April

no plans as it is not a holiday for my sons school - which is nice as we get a seat on the train in the morning!
thepossum at 12:58 PM JST - 30th April

Golden Week ? More like "Golden Shower" week as the weather just pisses down rain for the duration of the holiday ! Here we are into day 5 of mine and it's the first day it hasn't drizzled here in the Tokyo area.

Also, the economic situation here in Japan is very clear, miserable ! People shot their wad during the bubble economy and now they are left to pick up the pieces. No concept of bank savings or individual investments has left the nation on jitters. I could go on and on, but the fact is living in Japan is just no fun without the cash to escape the boredom of daily life. What a mess this nation has created for its citizens !
Spanishwoman at 10:02 AM JST - 1st May

I bought my flight for the GW from nrt to hnl for just 400 euro in a Spanish homepage. There were even flights for 300 euro, 9 days in Hawaii, but that holiday is too long for my husband. Spending an average $269 a day? In what? Japanese agencies should offer more hotels apart from just Hiltons. If you search for hotels on your own, you really can get better prices. But you must understand English, of course. Maybe that's a problem here.