AI Revitalizes Japan's Manufacturing Sector; Service Sector Burdened

AI has saved jobs in the manufacturing sector, while the service sector has buckled under the weight of cost burdens. According to the July 'Reuters Tankan' survey released by Reuters on the 15th, the manufacturing sector sentiment index (a figure indicating economic conditions as perceived by corporations) remained unchanged from the previous month at plus 13.

Electronics companies and semiconductor material firms responded that demand driven by expanded investment in AI servers and data centers is underpinning production and exports.

Conversely, the service sector sentiment index fell 7 points from 32 to 25, with companies citing rising labor costs, increases in food and energy prices, and higher import prices due to the weak yen as the primary causes.