The Engel’s coefficient, or the proportion of money spent on food in household expenses, hit a 29-year high in Japan in 2016, partly reflecting changes in the social structure, an internal affairs ministry survey has revealed.

The coefficient for households with at least two members rose 0.8 percentage point from the previous year to 25.8 pct, the survey found.

The living standard indicator tends to fall as people become wealthier.

In Japan, the Engel’s coefficient dropped below 25 pct by the late 1990s, amid economic growth. After showing flat moves, however, it has shown a rising trend in recent years. In the past two years, the indicator rose 1.8 points.

Of the total gains for 2015 and 2016, 0.9 point can be attributed to price hikes, the ministry said.

In 2016, the overall consumer price index fell but food prices went up 1.7 pct from the previous year, led by rises in prices of imported materials on the yen’s drop against other currencies and vegetable price surges for weather reasons.

Meanwhile, the Engel’s coefficient was pushed up by 0.2 point in 2015-16 due to growing demand for cooked meals and prepared foods from double-income families and older people, which illustrates changes being made to the Japanese society, the ministry said.

Satoshi Osanai, senior economist at the Daiwa Institute of Research, observed that consumers have grown cautious about spending in view of a series of food product price hikes at a time when income does not increase much.

The ministry said a drop in the overall household spending boosted the Engel’s coefficient by 0.7 point in the two years. (Jiji Press)