| Consensus | Consensus Range | Actual | Previous | |
|---|---|---|---|---|
| Rate | 2.6% | 2.5% to 2.7% | 2.6% | 2.6% |
Highlights
Japanese payrolls posted the 22nd straight rise on year in May amid labor shortages at retailers, hotels, restaurants and education support firms while the unemployment rate was unchanged at 2.6 percent for the third 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 while others had forecast a slight uptick to 2.7 percent.
Compared to the previous month, the number of people who lost their jobs or retired was unchanged in May after falling 4.3 percent in April for the first fall in three months. The number of those who quit to look for better positions fell 3.8 percent after marking the first drop in three months in April with a 1.3 percent fall. The number of those who began looking for work and thus were counted as being unemployed rose 2.0 percent after rising at the same rate the previous month. Tight labor conditions and rising wages are encouraging people to join or return to the workforce.
From a year earlier, the number of employed rose 210,000 to an unadjusted 67.66 million in May for the 22nd straight increase, led by a sharp rise among women that more than offset a slight drop in men. Regular jobs rose on year for the seventh straight month while non-regular jobs dropped after recent sharp gains. It followed increases of 90,000 in April, 270,000 in March and 610,000 in February.
The number of unemployed rose 50,000 on the year to an unadjusted 1.93 million in May, after rising 30,000 in April, falling 80,000 in March and rising 30,000 in February. It has drifted down from a pandemic peak of 2.17 million in October 2020. December's 1.56 million was the lowest since 1.46 million in December 2019.
In its monthly economic report for June, the government maintained its overall assessment, saying the economy is recovering"moderately" and likely to stay on course pinning its hopes on more widespread wage hikes and stimulative effects of planned energy subsidies and cash handouts aimed at easing the pain of pensioners and low-income earners hard hit by elevated living costs. It also repeated that employment conditions are"showing signs of improvement."
Econoday's Relative Performance Index stands at plus 14, above zero, which indicates the Japanese economy is performing better than expected. Excluding the impact of inflation, the RPI is plus 20.
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 while others had forecast a slight uptick to 2.7 percent.
Compared to the previous month, the number of people who lost their jobs or retired was unchanged in May after falling 4.3 percent in April for the first fall in three months. The number of those who quit to look for better positions fell 3.8 percent after marking the first drop in three months in April with a 1.3 percent fall. The number of those who began looking for work and thus were counted as being unemployed rose 2.0 percent after rising at the same rate the previous month. Tight labor conditions and rising wages are encouraging people to join or return to the workforce.
From a year earlier, the number of employed rose 210,000 to an unadjusted 67.66 million in May for the 22nd straight increase, led by a sharp rise among women that more than offset a slight drop in men. Regular jobs rose on year for the seventh straight month while non-regular jobs dropped after recent sharp gains. It followed increases of 90,000 in April, 270,000 in March and 610,000 in February.
The number of unemployed rose 50,000 on the year to an unadjusted 1.93 million in May, after rising 30,000 in April, falling 80,000 in March and rising 30,000 in February. It has drifted down from a pandemic peak of 2.17 million in October 2020. December's 1.56 million was the lowest since 1.46 million in December 2019.
In its monthly economic report for June, the government maintained its overall assessment, saying the economy is recovering"moderately" and likely to stay on course pinning its hopes on more widespread wage hikes and stimulative effects of planned energy subsidies and cash handouts aimed at easing the pain of pensioners and low-income earners hard hit by elevated living costs. It also repeated that employment conditions are"showing signs of improvement."
Econoday's Relative Performance Index stands at plus 14, above zero, which indicates the Japanese economy is performing better than expected. Excluding the impact of inflation, the RPI is plus 20.
Market Consensus Before Announcement
Japanese payrolls are expected to post their 22nd straight rise on year in May amid widespread labor shortages. The unemployment rate is forecast to be unchanged at 2.6 percent for a third straight month after rising to the level in February from a nearly four-year low of 2.4 percent in January. Both the number of people who lost their jobs or retired and those who quit to look for better positions showed the first drop in three months in April. The number of those who began looking for work and thus were counted as being unemployed rose after being flat.
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.
