Soaring Inflation and Escalating Hotel Rates Dampen Golden Week Tourism

Golden Week, Japan's extended holiday period, kicks off this weekend, but soaring prices and record inbound tourism have put a damper on domestic travelers' plans. In the past, Golden Week, featuring an extended series of public holidays, gave Japanese workers a rare opportunity to explore their own country or venture abroad. However, the present economic climate has many feeling the squeeze of soaring costs for daily necessities, including cabbage, rice, and electricity bills.

One contributing factor to this financial strain is the devaluation of the Japanese yen, causing foreign tourists to flock to the country in record numbers. Lured by the abundance of Japanese attractions, from Mount Fuji's majestic slopes to shrines and sushi bars, this influx of visitors has driven up demand for hotel rooms. According to a Nikkei survey, room rates in the five major cities are around 16% pricier at the start of this year's Golden Week compared to last.

This rise in hotel prices, among other costs, has left Japanese residents feeling less inclined to travel during Golden Week. A study by JTB, a major travel agency, found that only 20.9% of their respondents plan on taking a trip during the holiday, a significant drop of 5.6% from the previous year. Another survey by marketing research firm Intage reported a 2% decline in the number of those planning to travel domestically during the holiday period, down to 13.6%.

Despite the desire to avoid crowds, it seems the main factor deterring domestic travel is financial burden. According to Intage, the number of people refraining from travel due to financial constraints is growing. Even though international travel can be seen as a luxury, many are unlikely to venture abroad due to their tight budgets. Interestingly, despite these challenges, the average budget for Golden Week outings has edged up to $201 from $192, suggesting a reluctant acceptance of the higher costs.

Japan welcomed more than 36.8 million tourist arrivals in 2024, topping the previous record of 32 million set in 2019. The government aims to almost double tourist numbers to 60 million annually by 2030. However, this tourism boom has also led to increasing complaints from locals about overcrowding, traffic violations, and bad behavior by some visitors. Residents and authorities in popular tourist destinations, like Kyoto and towns near Mount Fuji, are expressing growing frustration with the situation. In response to these concerns, measures are being taken to address the issues and balance the needs of both tourists and local residents.

The devaluation of the Japanese yen tends to increase the influx of foreign tourists, breaking previous records.
The abundance of Japanese attractions like Mount Fuji and sushi bars lure tourists from around the world.
High demand for hotel rooms driven by tourists has led to an approximate 16% increase in room rates during Golden Week.
In the current economic climate, many Japanese workers feel the squeeze of soaring costs for daily necessities, including travel.
A study by JTB, a major travel agency, found that only 20.9% of their respondents plan on traveling during Golden Week, a significant drop from the previous year.
The average budget for Golden Week outings has edged up to $201, suggesting a reluctant acceptance of higher costs.
The growing number of people refraining from travel due to financial constraints is a concerning trend in personal-finance and household budgeting.
Despite the challenges, the Japanese government aims to almost double tourist numbers to 60 million annually by 2030, creating a need for balance between tourists and local residents.