Japanese payrolls posted the 21st straight rise on year in April amid labor shortages at hotels, restaurants and telecommunications firms while the unemployment rate was unchanged at 2.6 percent for the second month in a row after rising to the level in February from a nearly four-year low of 2.4 percent in January.

The seasonally adjusted jobless rate of 2.6 percent in April was in line with the median forecast of 2.6 percent (some had expected a slight improvement to 2.5 percent). The January rate was the lowest since 2.4 percent in February 2020.

Compared to the previous month, the number of people who lost their jobs or retired fell 4.3 percent in April for the first fall in three months after rising 4.5 percent in March. The number of those who quit to look for better positions also marked the first drop in three months, down 1.3 percent, after rising 2.6 percent. The number of those who began looking for work and thus were counted as being unemployed rose 2.0 percent after being flat and rising in the previous two months amid tight labor conditions and rising wages.

In its monthly economic report for May released last week, the government maintained its overall assessment, saying the economy is recovering moderately backed by a high pace of wage hikes amid widespread labor shortages. It also repeated that employment conditions are"showing signs of improvement."

Econoday's Relative Performance Index stands at minus 5, below zero, which indicates the Japanese economy is performing slightly worse than expected. Excluding the impact of inflation, the RPI is minus 13.

The latest unemployment rate is below the recent high of 3.1 percent in October 2020 but there is still some room for improvement toward 2.2 percent seen in December 2019, just before the pandemic triggered a global economic slump.

The jobless rate averaged 2.6 percent in fiscal 2023, unchanged from fiscal 2022, when it improved from 2.8 percent in fiscal 2021 and 2.9 percent in fiscal 2020 but still above 2.3 percent in the pre-pandemic year of fiscal 2019, which was the lowest since 2.2 percent in fiscal 1992.

Japanese payrolls are expected to post their 21st straight rise on year in April amid lingering labor shortages at hospitals, hotels, restaurants and telecommunications firms. The unemployment rate is forecast to be unchanged at 2.6 percent for a second straight month after rising to the level in February from a nearly four-year low of 2.4 percent in January. The number of people who lost their jobs or retired rose at a slower pace in March after a jump in February, offsetting a continued increase in the number of those who quit to look for better positions amid tight labor conditions and rising wages.

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.