Impact of the Great East Japan Earthquake on Local Industries: Synthesis and analysis from a survey (Japanese)

Nobuaki Hamaguchi

Policy Discussion Papers (Japanese) from Research Institute of Economy, Trade and Industry (RIETI)

Abstract: We report some preliminary results from our questionnaire survey on manufacturing establishments in the six prefectures affected by the Great East Japan Earthquake in March 2011. We identify the characteristics of the supply chain in the affected areas and analyze the impacts it received. These manufacturing establishments do not produce highly differentiated products, yet they are not easily substitutable due to high customer service and maintenance requirement. We found that more severe damages were concentrated in Miyagi prefecture. Among the disruptions caused from external services, establishments were most affected by electric power shortage, followed by parts procurement, transport, and water supply in descending order. Outside of Miyagi, where power shortages persisted less than 10 days, discontinuation of parts procurement continued for more than a month. The production shutdown period was 16 days on average, while it was 26 days in Miyagi. Establishments which changed parts suppliers tend to insist on the same product quality and delivery timeliness as experienced with their former suppliers at a minimum, while accepting higher prices and longer distances. Employment was maintained, but firms experienced slight loss in sales. After the earthquake, periodic simulation drills, preparation of business continuity plans, seismic strengthening, equipment of private power generator, and alternative transportation planning have been prioritized, however, firms cannot afford to pay for stronger preparation for low-probability, high-impact natural disasters occurring in the future.

Pages: 49 pages
Date: 2013-01
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eti:rpdpjp:13001

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