| Consensus | Consensus Range | Actual | Previous | |
|---|---|---|---|---|
| Rate | 2.6% | 2.5% to 2.6% | 2.5% | 2.6% |
Highlights
Japanese payrolls posted the 23rd straight rise on year in June, led by a surge in the wholesale and retail industry which offset fewer transport and manufacturing jobs. The unemployment rate dipped to 2.5 percent from 2.6 percent for the first improvement in five months as much fewer people began looking for work.
The seasonally adjusted jobless rate of 2.5 percent in June is slightly below the median forecast of 2.6 percent; only a few economists expected a slight improvement to 2.5 percent. It was unchanged at 2.6 percent for three months through May after rising to the level in February from a nearly four-year low of 2.4 percent in January. The 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.
Compared to the previous month, the number of people who began looking for work and thus were counted as being unemployed fell a sharp 7.8 percent in June after rising 2.0 percent the previous month. Tight labor conditions and rising wages have prompted more women and retirees to join or return to the workforce in recent months: Some of them appear to have found a job. The number of those who quit to look for better positions also dipped 1.3 percent after falling 3.8 percent.
Those two factors more than offset the impact of jobs cuts and retirements, whose combined number rose 4.5 percent in June after being unchanged in May.
Econoday's Relative Performance Index stands at minus 6, slightly below zero, which indicates the Japanese economy is performing largely as expected after underperforming recently. Excluding the impact of inflation, the RPI is plus 16.
From a year earlier, the number of employed rose 370,000 to an unadjusted 68.22 million in June for the 23rd straight increase, led by a continued sharp rise among women and a rebound in men. Regular jobs rose on year for the eighth straight month while non-regular jobs dropped for the second straight month after recent sharp gains. It followed increases of 210,000 in May, 90,000 in April, 270,000 in March and 610,000 in February.
The number of unemployed rose 20,000 on the year to an unadjusted 1.81 million in June for the third straight increase, after rising 50,000 in May and 30,000 in April and falling 80,000 in March. 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.
The seasonally adjusted jobless rate of 2.5 percent in June is slightly below the median forecast of 2.6 percent; only a few economists expected a slight improvement to 2.5 percent. It was unchanged at 2.6 percent for three months through May after rising to the level in February from a nearly four-year low of 2.4 percent in January. The 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.
Compared to the previous month, the number of people who began looking for work and thus were counted as being unemployed fell a sharp 7.8 percent in June after rising 2.0 percent the previous month. Tight labor conditions and rising wages have prompted more women and retirees to join or return to the workforce in recent months: Some of them appear to have found a job. The number of those who quit to look for better positions also dipped 1.3 percent after falling 3.8 percent.
Those two factors more than offset the impact of jobs cuts and retirements, whose combined number rose 4.5 percent in June after being unchanged in May.
Econoday's Relative Performance Index stands at minus 6, slightly below zero, which indicates the Japanese economy is performing largely as expected after underperforming recently. Excluding the impact of inflation, the RPI is plus 16.
From a year earlier, the number of employed rose 370,000 to an unadjusted 68.22 million in June for the 23rd straight increase, led by a continued sharp rise among women and a rebound in men. Regular jobs rose on year for the eighth straight month while non-regular jobs dropped for the second straight month after recent sharp gains. It followed increases of 210,000 in May, 90,000 in April, 270,000 in March and 610,000 in February.
The number of unemployed rose 20,000 on the year to an unadjusted 1.81 million in June for the third straight increase, after rising 50,000 in May and 30,000 in April and falling 80,000 in March. 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.
Market Consensus Before Announcement
Japanese payrolls are expected to post their 23rd straight rise on year in June as some sectors continued struggling to fill vacancies. The unemployment rate is forecast to be unchanged at 2.6 percent for a fourth straight month after rising to the level in February from a nearly four-year low of 2.4 percent in January. In May, sharp employment gains were seen in the wholesale/retail industry, the hotels, restaurants and bars category and education support providers. By contrast, the manufacturing industry shed workers for the third straight month.
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.
