Abenomics, Shinzo Abe's quest to bring growth and inflation back to Japan, has thrown a spanner in the works of Tokyo's preparations to host the 2020 Olympic Games as a chronic labor shortage in the construction industry and inflated materials prices threaten the country's promised compact games.
Last year the Japanese capital fought off competition from Madrid and Istanbul by promising a compact games, with all events to be staged within an 8 kilometer radius of the athletes' village in the Harumi district of Tokyo's Chuo ward. But last week Yoichi Masuzoe, Tokyo governor, began to scout other potential sites further out to save cash.
Plans to build a new marina on reclaimed land in Wakasu, not far from Harumi, for example, may be scrapped in favour of using existing facilities across the bay in Chiba prefecture, Mr Masuzoe's office confirmed on Tuesday.
Japan's recovery under Mr Abe, prime minister since December 2012, has caused tightness across the labor market: data released on Tuesday showed that there were 1.1 jobs per applicant in June, the highest ratio since the early 1990s.
But shortages are acute in the construction sector, where the task of upgrading ageing public infrastructure – part of Mr Abe's three-pronged stimulus plan – has fallen on a labor force already strained by the rebuilding of tsunami-afflicted areas in northeast Japan.