| Consensus | Consensus Range | Actual | Previous | |
|---|---|---|---|---|
| Rate | 2.6% | 2.6% to 2.7% | 2.6% | 2.7% |
Highlights
Japanese payrolls posted their 14th straight rise on year in September as massive hiring by hotels, restaurants and builders continued mitigating a sharp decline in manufacturing jobs while the unemployment rate edged down to 2.6 percent, as expected, after being unchanged in August, data released Tuesday by the Ministry of Internal Affairs and Communications showed.
Compared to the previous month, the number of people who lost their jobs or retired fell sharply for the second straight month and that of those who quit to look for other openings declined after two months of gains, more than offsetting the impact of a rebound in the number of people who began looking for work.
Econoday's Relative Performance Index stood at plus 36, above zero, which indicates the Japanese economy is performing better than expected after outperforming with a wider margin earlier. Excluding the impact of inflation, the RPI was at plus 38.
The seasonally adjusted average unemployment rate stood at 2.6 percent in September, after being unchanged at 2.7 percent in August and unexpectedly rising to the level in July from 2.5 percent in June. It was in line with the median economist forecast of 2.6 percent (forecasts ranged from 2.6 percent to 2.7 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. It 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.
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.
In its monthly economic report for October released on Monday, the government maintained its overall assessment, saying the economy is recovering moderately, but warned that consumer inflation is high, labor shortages are broad-based and the war in the Middle East is adding to downside risks to domestic recovery led by wage and income growth. 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 210,000 to an unadjusted 67.87 million in September for the 14th straight increase after rising 220,000 in August, 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 fell by 50,000 on the year to an unadjusted 1.82 million in September after rising 90,000 in August and climbing 70,000 for the first rise in three months in July. It marked 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 September 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 recovering inflow of foreign visitors.
Employment growth picked up in the construction industry while manufacturing jobs posted a sharp drop after marking solid gains through July.
The medical and welfare industry shed workers on year after recent gains from June to August.
Employment in the wholesale and retail industry slowed after sharp gains in the previous two months. Financial firms and the real-estate and goods leasing industry continued to trim payrolls from year-earlier levels.
Compared to the previous month, the number of people who lost their jobs or retired fell sharply for the second straight month and that of those who quit to look for other openings declined after two months of gains, more than offsetting the impact of a rebound in the number of people who began looking for work.
Econoday's Relative Performance Index stood at plus 36, above zero, which indicates the Japanese economy is performing better than expected after outperforming with a wider margin earlier. Excluding the impact of inflation, the RPI was at plus 38.
The seasonally adjusted average unemployment rate stood at 2.6 percent in September, after being unchanged at 2.7 percent in August and unexpectedly rising to the level in July from 2.5 percent in June. It was in line with the median economist forecast of 2.6 percent (forecasts ranged from 2.6 percent to 2.7 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. It 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.
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.
In its monthly economic report for October released on Monday, the government maintained its overall assessment, saying the economy is recovering moderately, but warned that consumer inflation is high, labor shortages are broad-based and the war in the Middle East is adding to downside risks to domestic recovery led by wage and income growth. 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 210,000 to an unadjusted 67.87 million in September for the 14th straight increase after rising 220,000 in August, 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 fell by 50,000 on the year to an unadjusted 1.82 million in September after rising 90,000 in August and climbing 70,000 for the first rise in three months in July. It marked 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 September 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 recovering inflow of foreign visitors.
Employment growth picked up in the construction industry while manufacturing jobs posted a sharp drop after marking solid gains through July.
The medical and welfare industry shed workers on year after recent gains from June to August.
Employment in the wholesale and retail industry slowed after sharp gains in the previous two months. Financial firms and the real-estate and goods leasing industry continued to trim payrolls from year-earlier levels.
Market Consensus Before Announcement
Japanese payrolls are expected to post their 14th straight rise on year in September as hospitals, hotels, restaurants and construction firms tried to fill job vacancies while the unemployment rate is forecast to have edged down to 2.6 percent after being flat at 2.7 percent in August and unexpectedly rose from 2.5 percent in July. Some of the people who had quit earlier to look for better openings appear to have found work in the past couple of months.
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.
