【Aging, safety net and fiscal crisis in Japan】No.257: People's life consciousness has not deteriorated in the COVID-19 pandemic

The Bank of Japan conducts a survey called the “Life Consciousness Questionnaire Survey” every three months for individuals over the age of 20. Figures 1 and 2 compare the current life consciousness of people under the condition of economic stagnation caused by COVID-19 and the life consciousness of people after the Lehman shock in September 2008.

As shown in Figure 1, after the Lehman shock, about 60% of respondents answered that "the feeling of comfort has decreased compared to a year ago." Meanwhile, as of June 2020, only 42.6% of the respondents gave the same answer. This is not a big jump from the 41.7% that gave this answer in December 2019, before the COVID-19 turmoil began; therefore, people’s life consciousness has not significantly deteriorated.

One of the reasons for this is that only 39.1% of the people responded in the June 2020 survey that "income has decreased compared to a year ago" (Figure 2), whereas this figure was over 50% after the Lehman shock. The economy recovered very quickly after the shock, whereas the negative impact of income reduction due to COVID-19 has so far disproportionately affected the tourism, food service, and transportation industries. If the economic stagnation caused by COVID-19 lasts for a long period of time, income reduction will spread to all industries, and there is a risk that people's life consciousness will be badly affected in turn.

Figure 1　Survey results on the feeling of comfort

Source: The Bank of Japan

Figure 2　Survey results on income

Source: The Bank of Japan