JP: Unemployment Rate

Thu Sep 28 18:30:00 CDT 2017

Consensus Actual Previous
Level 2.8% 2.8% 2.8%

August unemployment rate remaining at 2.8 percent for the third month and in line with the consensus forecast. It is the lowest official unemployment rate since the mid-1990s. The number of employed persons increased 840,000 on the year in August after increasing 590,000 in July. Japan's participation rate was 60.9 percent in August.

Japan's economy is continuing to generate solid employment growth and multi-year lows in unemployment, broadly in line with recent comments from the Bank of Japan highlighting the strength of the labour market as a positive factor for the growth outlook. Although these gains in employment have yet to translate into a sustained and significant boost to wage growth.

The Unemployment Rate measures the number of unemployed as a percentage of the labor force. The unemployment rate is part of the Labour Force Survey which also includes employment data.

The unemployment rate and employment change are carefully monitored. The employment data show the number employment along with the change in employment for the previous year. Monthly changes in employment also help clarify whether businesses are hiring. The unemployment rate is the percentage of the labor force that is unemployed. A lower jobless rate translates into more income earning workers and greater consumption. Increased spending is a positive for consumer oriented economic growth, something that has lagged in Japan.

By tracking the jobs data, investors can sense the degree of tightness in the job market. If wage inflation threatens, it's a good bet that interest rates will rise; bond and stock prices will fall. No doubt that the only investors in a good mood will be the ones who watched the employment report and adjusted their portfolios to anticipate these events.