Domestic Factories Down For 5th Straight Year

TOKYO (Nikkei)--The number of domestic factories has declined for a fifth straight year since 2007, a manufacturing report released Friday shows.

The nation had 120,586 factories with more than 10 employees in 2011, down 3.2% from the previous year. The report -- compiled by the Internal Affairs Ministry and the Ministry of Economy, Trade and Industry -- reveals a drop in capital spending, tied to a slowdown in domestic production.

Factories decreased in 21 of 24 industries. The communications equipment industry took a 6.9% hit resulting from weaker demand for LCD TVs and computers. But construction equipment demand increased on rebuilding from the March 2011 earthquake, leading to a 2.5% rise in manufacturing-equipment plants.

Disaster-hit areas lost a significant number of factories, many of them in the food industry. The figures fell 17% in Miyagi Prefecture, 9.9% in Iwate Prefecture, and 9.6% in Fukushima Prefecture.

(The Nikkei, March 23 morning edition)

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