| Consensus | Consensus Range | Actual | Previous | |
|---|---|---|---|---|
| Rate | 2.6% | 2.5% to 2.7% | 2.7% | 2.7% |
Highlights
Japanese payrolls posted their 13th straight growth on year in August as hotels, restaurants, hospitals and construction firms continued to fill job vacancies while the unemployment rate was unchanged at 2.7 percent after rising unexpectedly to the level in July from 2.5 percent in June as a fall in job cuts offset a rise in quits for better positions, data released Friday by the Ministry of Internal Affairs and Communications showed.
The government's domestic travel discount program for residents and widely eased public health rules have been supporting the tourism industry and some retail stores.
Compared to the previous month, the number of people who lost their jobs or retired fell after rising the previous month and fewer people began looking for work. The combined effect of those moves was offset by a further rise in the number of those who quit to look for other openings, which marked its first rise in four months in July.
In July, more women joined the labor market to look for openings, hoping to support household incomes amid rising costs for daily necessities and improving wages. Some of them appeared to have found work, pushing down the unemployment rate among women in August while the male jobless rate rose.
The unexpected uptick in the March jobless rate to 2.8 percent from February's 2.6 percent was caused mainly by an increase in the number of people leaving to look for better positions. Some of those people found work in April, when the rate slipped back to 2.6 percent.
Econoday's Relative Performance Index stood at minus 37, below zero, which indicates the Japanese economy is performing worse than expected after underperforming with a wider margin recently. Excluding the impact of inflation, the RPI was at minus 63.
The seasonally adjusted average unemployment rate stood at 2.7 in August, unchanged from 2.7 percent in July but above 2.5 percent in June, when it improved from 2.6 percent in May. It came in slightly higher than the median economist forecast of 2.6 percent. The latest figure is below 2.8 percent seen in March but is still above the 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 remains 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 for September released on Tuesday, the government maintained its overall assessment, saying the economy is recovering moderately thanks to wage hikes, but noted that high costs for daily necessities are eroding purchasing power of households, particularly among lower income families. It also maintained its view on employment conditions after upgrading it for the first time in 11 months in June, saying they are"showing signs of improvement."
Compared to a year earlier, the number of employed rose 220,000 to an unadjusted 67.73 million in August for the 13th straight increase after rising 170,000 in July, 260,000 in June, 150,000 in May, 140,000 in April, 150,000 in March and 90,000 in February and surging 430,000 in January.
The number of unemployed rose 90,000 on the year to an unadjusted 1.86 million in August after rising 70,000 for the first rise in three months in July, falling 70,000 in June and 30,000 in May, rising 20,000 in April, and marking its first year-over-year rise in 21 months in March with a 130,000 jump. 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 August from a year earlier was led by a continued sharp rise in the hotels, restaurants and bars category, which has benefited from government subsidies for domestic traveling, pent-up domestic demand and a fast-recovering inflow of foreign visitors. The increase in the medical and welfare category slowed after rebounding in June and falling in the previous four months.
Employment growth also decelerated in the construction industry while manufacturing jobs decreased after recent solid gains.
Employment in the wholesale and retail industry continued accelerating but sharp drops were seen in the financial and transportation industries as well as in the real-estate and goods leasing category.
The government's domestic travel discount program for residents and widely eased public health rules have been supporting the tourism industry and some retail stores.
Compared to the previous month, the number of people who lost their jobs or retired fell after rising the previous month and fewer people began looking for work. The combined effect of those moves was offset by a further rise in the number of those who quit to look for other openings, which marked its first rise in four months in July.
In July, more women joined the labor market to look for openings, hoping to support household incomes amid rising costs for daily necessities and improving wages. Some of them appeared to have found work, pushing down the unemployment rate among women in August while the male jobless rate rose.
The unexpected uptick in the March jobless rate to 2.8 percent from February's 2.6 percent was caused mainly by an increase in the number of people leaving to look for better positions. Some of those people found work in April, when the rate slipped back to 2.6 percent.
Econoday's Relative Performance Index stood at minus 37, below zero, which indicates the Japanese economy is performing worse than expected after underperforming with a wider margin recently. Excluding the impact of inflation, the RPI was at minus 63.
The seasonally adjusted average unemployment rate stood at 2.7 in August, unchanged from 2.7 percent in July but above 2.5 percent in June, when it improved from 2.6 percent in May. It came in slightly higher than the median economist forecast of 2.6 percent. The latest figure is below 2.8 percent seen in March but is still above the 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 remains 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 for September released on Tuesday, the government maintained its overall assessment, saying the economy is recovering moderately thanks to wage hikes, but noted that high costs for daily necessities are eroding purchasing power of households, particularly among lower income families. It also maintained its view on employment conditions after upgrading it for the first time in 11 months in June, saying they are"showing signs of improvement."
Compared to a year earlier, the number of employed rose 220,000 to an unadjusted 67.73 million in August for the 13th straight increase after rising 170,000 in July, 260,000 in June, 150,000 in May, 140,000 in April, 150,000 in March and 90,000 in February and surging 430,000 in January.
The number of unemployed rose 90,000 on the year to an unadjusted 1.86 million in August after rising 70,000 for the first rise in three months in July, falling 70,000 in June and 30,000 in May, rising 20,000 in April, and marking its first year-over-year rise in 21 months in March with a 130,000 jump. 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 August from a year earlier was led by a continued sharp rise in the hotels, restaurants and bars category, which has benefited from government subsidies for domestic traveling, pent-up domestic demand and a fast-recovering inflow of foreign visitors. The increase in the medical and welfare category slowed after rebounding in June and falling in the previous four months.
Employment growth also decelerated in the construction industry while manufacturing jobs decreased after recent solid gains.
Employment in the wholesale and retail industry continued accelerating but sharp drops were seen in the financial and transportation industries as well as in the real-estate and goods leasing category.
Market Consensus Before Announcement
Japanese payrolls are expected to record their 13th straight growth on year in August as hospitals, hotels, restaurants and factories continued to secure workers while the unemployment rate is forecast to have edged down to 2.6 percent after rising unexpectedly to 2.7 percent in July from 2.5 percent the previous month. Job cuts are believed to have steadied and fewer people appeared to have begun looking for work. In July, more women joined the labor market to look for openings, hoping to support household income amid rising costs for daily necessities and improving wages.
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.
