| Consensus | Consensus Range | Actual | Previous | |
|---|---|---|---|---|
| Rate | 2.7% | 2.6% to 2.8% | 2.6% | 2.8% |
Highlights
Japanese payrolls posted their ninth straight year-over-year growth in April as the reopening of the economy boosted demand for consumer spending on services and manufacturing picked up while the unemployment rate eased to 2.6 percent from 2.8 percent in March on fewer job cuts and quits, data released Tuesday by the Ministry of Internal Affairs and Communications showed.
Compared to the previous month, fewer people lost their jobs, retired or quit to look for other openings, outpacing a slight increase in the number of those who began looking for work, and thus leading to lower unemployment. The unexpected uptick in the March jobless rate was caused mainly by an increase in the number of people leaving to look for better jobs. Some of those people appeared to have found work in April.
The government's domestic travel discount program and widely eased public health rules have been supporting the tourism industry, which has also benefited from returning visitors from overseas.
The Econoday Consensus Divergence Index stood at plus 23, comfortably above zero, which indicates the Japanese economy is performing better than expected. Excluding the impact of inflation, the index was at plus 41.
The seasonally adjusted average unemployment rate stood at 2.6 percent in April, compared to the median economist forecast of 2.7 percent. It fell from 2.8 percent in March and matched February's 2.6 percent but is still above a three-year low of 2.4 percent hit in January. The jobless rate moved in tight ranges of 2.7 percent to 3.0 percent in 2021 and 2.5 percent to 2.8 percent in 2022.
The latest figure is below the recent high of 3.1 percent reached in October 2020 but is above 2.2 percent recorded in December 2019, just before the pandemic triggered a global economic slump.
In its monthly economic report released last week, the government maintained its assessment that employment conditions as"picking up."
Compared to a year earlier, the number of employed rose 140,000, to an unadjusted 67.41 million in April for the ninth straight increase after rising 150,000 in March and 90,000 in February and surging 430,000 in January.
The number of unemployed rose 20,000 on the year to an unadjusted 1.90 million in April, after marking its first year-over-year rise in 21 months in March with a 130,000 jump and falling 60,000 in February. It has drifted down from a pandemic peak of 2.17 million in October 2020 but is still above 1.60 million at the beginning of 2020.
The overall employment increase in April from a year earlier was led by a sharp rise in the manufacturing sector for the third straight increase, a rebound in entertainment and continued gains in communications as well as the hotels, restaurants and bars category, which has been benefiting from the government subsidy for domestic traveling.
Jobs in the medical and welfare category slumped for the second straight month as new Covid cases have decreased. Employment in education support posted a sharp drop after being nearly flat.
Jobs in the wholesale and retail industry dropped on the year for the fifth straight month. Employment at construction firms fell for the second straight month.
Compared to the previous month, fewer people lost their jobs, retired or quit to look for other openings, outpacing a slight increase in the number of those who began looking for work, and thus leading to lower unemployment. The unexpected uptick in the March jobless rate was caused mainly by an increase in the number of people leaving to look for better jobs. Some of those people appeared to have found work in April.
The government's domestic travel discount program and widely eased public health rules have been supporting the tourism industry, which has also benefited from returning visitors from overseas.
The Econoday Consensus Divergence Index stood at plus 23, comfortably above zero, which indicates the Japanese economy is performing better than expected. Excluding the impact of inflation, the index was at plus 41.
The seasonally adjusted average unemployment rate stood at 2.6 percent in April, compared to the median economist forecast of 2.7 percent. It fell from 2.8 percent in March and matched February's 2.6 percent but is still above a three-year low of 2.4 percent hit in January. The jobless rate moved in tight ranges of 2.7 percent to 3.0 percent in 2021 and 2.5 percent to 2.8 percent in 2022.
The latest figure is below the recent high of 3.1 percent reached in October 2020 but is above 2.2 percent recorded in December 2019, just before the pandemic triggered a global economic slump.
In its monthly economic report released last week, the government maintained its assessment that employment conditions as"picking up."
Compared to a year earlier, the number of employed rose 140,000, to an unadjusted 67.41 million in April for the ninth straight increase after rising 150,000 in March and 90,000 in February and surging 430,000 in January.
The number of unemployed rose 20,000 on the year to an unadjusted 1.90 million in April, after marking its first year-over-year rise in 21 months in March with a 130,000 jump and falling 60,000 in February. It has drifted down from a pandemic peak of 2.17 million in October 2020 but is still above 1.60 million at the beginning of 2020.
The overall employment increase in April from a year earlier was led by a sharp rise in the manufacturing sector for the third straight increase, a rebound in entertainment and continued gains in communications as well as the hotels, restaurants and bars category, which has been benefiting from the government subsidy for domestic traveling.
Jobs in the medical and welfare category slumped for the second straight month as new Covid cases have decreased. Employment in education support posted a sharp drop after being nearly flat.
Jobs in the wholesale and retail industry dropped on the year for the fifth straight month. Employment at construction firms fell for the second straight month.
Market Consensus Before Announcement
Japanese payrolls are expected to post their ninth straight year-over-year growth in April as the reopening of the economy has boosted demand for consumer spending on services, causing labor shortages at hotels and restaurants, while the unemployment rate is forecast to ease to 2.7 percent from 2.8 percent in March. More people quit their jobs to look for other openings in March, leading to higher unemployment, but some of them likely found work in April.
Definition
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.
Description
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.
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.
