| Consensus | Consensus Range | Actual | Previous | |
|---|---|---|---|---|
| Rate | 2.5% | 2.4% to 2.6% | 2.5% | 2.5% |
Highlights
Key points:
--Japanese payrolls posted their 35th straight rise on year in June amid chronic shortages of doctors and nurses as well as construction workers, truck drivers and system engineers. The seasonally adjusted unemployment rate stood at 2.5% after being unchanged in May and edging up to 2.5% in March from 2.4% in February.
--In unadjusted data, employment rose 510,000 on the year to 68.73 million after surging 720,000 the previous month. The number of unemployed fell by 50,000 to 1.76 million for the fifth drop in a row after falling a sharp 100,000 the previous month. In December 2024, it dipped 20,000 to a pre-pandemic level of 1.54 million, which was the lowest since 1.46 million in December 2019 (it was 1.60 million in January 2020).
--The year-on-year job creation was led by information technology and other services as well as continued solid gains in the medical and welfare industry and hotels and restaurants. On the downside, manufacturing jobs slumped for the third month in a row and wholesale/retail saw a sharp drop. Construction firms marked a rate increase after having shed payrolls for many months as they failed to attract workers.
Takeaway: The government continues to describe employment conditions as"showing signs of improvement in its latest monthly economic report for July but high costs of living are eroding consumer spending power.
--Japanese payrolls posted their 35th straight rise on year in June amid chronic shortages of doctors and nurses as well as construction workers, truck drivers and system engineers. The seasonally adjusted unemployment rate stood at 2.5% after being unchanged in May and edging up to 2.5% in March from 2.4% in February.
--In unadjusted data, employment rose 510,000 on the year to 68.73 million after surging 720,000 the previous month. The number of unemployed fell by 50,000 to 1.76 million for the fifth drop in a row after falling a sharp 100,000 the previous month. In December 2024, it dipped 20,000 to a pre-pandemic level of 1.54 million, which was the lowest since 1.46 million in December 2019 (it was 1.60 million in January 2020).
--The year-on-year job creation was led by information technology and other services as well as continued solid gains in the medical and welfare industry and hotels and restaurants. On the downside, manufacturing jobs slumped for the third month in a row and wholesale/retail saw a sharp drop. Construction firms marked a rate increase after having shed payrolls for many months as they failed to attract workers.
Takeaway: The government continues to describe employment conditions as"showing signs of improvement in its latest monthly economic report for July but high costs of living are eroding consumer spending power.
Market Consensus Before Announcement
--The seasonally adjusted unemployment rate in Japan is forecast to stay low and stable at 2.5% in June vs. 2.5% the previous three months and 2.4% in February. Payrolls seen up on year for the 35th straight month amid widespread labor shortages. Other data show real wages are falling amid high costs of living.
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.
