Tokyo City Review

Cities

About This Report

Apr 2017

Tokyo is the world's largest urban economy and most populous city. Its substantial consumer base of 37 million people in 2016, boosted by a surging number of Chinese tourists, constantly lures leading retail brands. However, having been an enduring exception to Japan's demographic crisis, the city is set to witness its population growth turn negative by 2021. A lack of young talent is already an obstacle as some companies are sceptical about Tokyo's drive to become Asia's most prominent financia

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Tokyo City Review

TOKYO HIGHLIGHTS

While Tokyo's GVA per employee (labour productivity) is 16% higher than in the rest of the country as of 2016, it is considerably behind other globally leading metropolitan economies. Tokyo's lower concentration of highly productive business services (eg finance) is a key reason for the gap.

Smaller average household size dampens household income

Despite Tokyo's productivity advantage, annual disposable household income in Tokyo was only 12% higher than in the rest of Japan as of 2016. A smaller average household size in Tokyo compared to the rest of the country depresses household income.

Greater spending on discretionary items

Consumer expenditure (excluding housing and transport) per household was 8% greater in the city than in the rest of Japan in 2016. Consumers in Tokyo display a much greater inclination towards discretionary items such as education, hotels and restaurants, and healthcare than their counterparts elsewhere in the country.

Relaxed approach to housing construction helps in the management of real estate price increases

Despite housing claiming a 38% higher expenditure per household in the city compared to the rest of the country in 2016, Tokyo's laissez-faire approach to housing construction helps to better contain real estate price increases than in other world-renowned cities. Meanwhile, transport is very affordable, with a 1% lower expenditure than elsewhere in Japan in 2016, due to a well-developed public transport system. Combined, transport and housing in Tokyo required 24% more expenditure in 2016 compared to the rest of the country.

TOKYO REVIEW AT A GLANCE

Understanding Tokyo Review structure
Chart 1 Overview
Key facts on Tokyo
Summary 1 Key Facts On Tokyo 2011, 2016, 2021

TOKYO HIGHLIGHTS

History
Delimitation of the metropolitan region
Chart 2 Map Of Tokyo Metropolitan Area
Main business districts

ECONOMY OF THE CITY

Industrial make-up
Chart 3 Industrial Composition Of Tokyo 2016
Chart 4 Labour Productivity: Selected Cities 2016
Recent developments and outlook
Chart 5 Dynamics Of Real GDP In Tokyo, Japan And Other Cities In Asia, 2011-2021
Summary 2 Labour Market Changes In Tokyo 2011, 2016

CONSUMER PROFILE

City demographics
Chart 6 Population By Age 2016
Chart 7 Drivers Of Population Growth In Tokyo 2011-2016
Household income
Chart 8 Household Distribution By Income In Tokyo 2016 And 2021

CONSUMER EXPENDITURE

Structure of household budget
Chart 9 Comparison Of Household Expenditure In Tokyo And Japan, 2016
Summary 3 Tokyo Household Budget Structure By Consumer Expenditure Item, % of total, 2011, 2016, 2021
City lifestyle
Chinese Visitors Boost Tokyo's International Tourism Market
Video Game Consoles Market Stagnant
City affordability
Housing
Chart 10 Household Expenditure On Housing: Selected Cities 2016
Transport
Chart 11 Household Expenditure On Transport: Selected Cities 2016

DEFINITIONS

APPENDIX

Summary 4 GDP Development, 2011, 2016, 2021
Summary 5 GDP By Origin, Current Prices, US$, Million, 2011-2016
Summary 6 Population And Labour Force, 2011-2016
Summary 7 Employed Population By Economic Sector, % of total, 2011-2016
Summary 8 Population By Sex And Broad Age Groups, ‘000, 2011-2016
Summary 9 Population Growth, 2011-2016
Summary 10 Forecast Population Growth
Summary 11 Population By Educational Attainment, 2011-2016
Summary 12 Structure Of Consumer Expenditure By Main Category, 2011-2016
Summary 13 Consumer Expenditure By Main Category, Per Household, Constant (2016) Prices, US$, 2011, 2016, 2021
Summary 14 Households By Income Band, % Of Total, Constant (2016) Prices 2011, 2016, 2021
Summary 15 Households By Income Band, ‘000, Current Prices 2011-2016
Summary 16 Inflation, 2011-2016
Summary 17 Transport Indicators, 2011-2016
Summary 18 Air Pollution, Concentration In Micrograms Per Cubic Metre, 2011-2016
Summary 19 Possession of Consumer Durables, % of Households, 2011, 2016, 2021