Business Outlook Survey (July-September 2025) Results Summary

The Cabinet Office and Ministry of Finance announced results of the Business Outlook Survey for Q3 2025 on September 11. The Business Survey Index (BSI) for large enterprises across all industries reached 4.7 percentage points, marking the first "increase" in two quarters since Q1 2025. Medium enterprises showed "increase" while small enterprises remained in "decrease" territory. In detail, large manufacturing enterprises recorded 3.8 percentage points while non-manufacturing reached 5.2 percentage points, both showing positive sentiment. Key contributing sectors included information and communication equipment manufacturing (17.8 points) and production machinery (9.9 points), while steel industry (-21.8 points) and non-ferrous metals (-11.5 points) were negative factors. The employment situation BSI for large enterprises stood at 26.8 percentage points, marking 57 consecutive quarters of labor shortage since September 2011. Major impacts of labor shortage included increased workload and working hours (63.3%), rising labor costs due to wage increases (42.9%), and higher recruitment costs (42.2%). Capital investment is projected to increase 6.8% in FY2025, with manufacturing up 13.9% and non-manufacturing up 3.1%. Software investment ranked highest priority for large enterprises at 56.5%, indicating accelerating digitalization trends.