Alexandru Arba
Research expert covering Japan
Freight transportation in Japan - statistics & facts
Freight transportation is of great significance to economies, as it represents the means to satisfy various demands and needs in society, and also enables international trade. In Japan, the annual volume of domestic freight transport alone surpasses four billion tons. Despite its pivotal importance and central place in Japan's economy, the freight transportation industry is in dire straits. One of the industry's most persistent problems is the workforce crisis, especially in road transportation, that announced itself long ago, and which is likely to exacerbate further in the future if no countermeasures are taken.
Japan's geographical features also make coastal shipping a desirable option for domestic freight transport, as the majority of the population live on one of Japan's main four islands that are located close to each other. Called cabotage, coastal shipping accounts for roughly forty percent of the payload distance of domestic cargo shipments, although it accounts for far less when purely looking at the cargo volume handled. Hence, coastal shipping is predominantly used for longer haul distances for cargo that is not time sensitive. Maritime shipping companies do not only play an important role in domestic freight transportation, but they are also indispensable for foreign trade. Shipping vessels cover more than 99 percent of the volume of Japan's international shipment transports, the rest being transported by air.
These challenges will be difficult to overcome in the near future if the price of freight transportation in Japan is to remain the same. In the long run, companies belonging to the more susceptible segments of the industry will need to find a way to create a more inviting work environment to attract employees or innovate through technology.
Trucks and ships dominate cargo transportation
The challenges faced by the freight transportation industry are a direct result of the characteristics of each industry segment. Freight transportation in Japan occurs in four ways: on road, water, rail, and in the air. Road transportation is the undisputed leader in terms of domestic cargo shipment volume. While the cargo journey of domestically shipped goods can involve various modes of transport, trucks are usually used to deliver the freight to its final destination and are often involved in short-distance cargo shipments. This requires a large fleet of trucks and the personnel to handle it, which is why the road freight transportation segment accounts by far for the largest share of the transportation industry's entire workforce.Japan's geographical features also make coastal shipping a desirable option for domestic freight transport, as the majority of the population live on one of Japan's main four islands that are located close to each other. Called cabotage, coastal shipping accounts for roughly forty percent of the payload distance of domestic cargo shipments, although it accounts for far less when purely looking at the cargo volume handled. Hence, coastal shipping is predominantly used for longer haul distances for cargo that is not time sensitive. Maritime shipping companies do not only play an important role in domestic freight transportation, but they are also indispensable for foreign trade. Shipping vessels cover more than 99 percent of the volume of Japan's international shipment transports, the rest being transported by air.
Tough working environment is unattractive to younger generations
Japan's notoriously dire demographic situation that is caused by a shrinking population coupled with an aging society is putting continued pressure on the labor market. The freight transportation industry is highly vulnerable to the shortage of workers. The road transportation segment is especially susceptible, as trucking requires a large labor force. Industry comparisons show that employees in the road transportation industry earn lower wages and have higher workloads than their peers from other industries. Overall, this tough working environment seems to fail to attract younger generations, which leads to an overstrained and aging workforce that is well above the age of the national labor force average.These challenges will be difficult to overcome in the near future if the price of freight transportation in Japan is to remain the same. In the long run, companies belonging to the more susceptible segments of the industry will need to find a way to create a more inviting work environment to attract employees or innovate through technology.
