Japan's jobless rate tops 5% in FY09, 1st time in 6 yrs

Japan's seasonally adjusted unemployment rate rose to 5.2 per cent in fiscal 2009, deteriorating for the second straight year, according to statistics released by the government. The government data showed today, that it has also topped the 5 per cent mark for the first time in six years due to the pressure on payrolls by the global economic downturn.

The rate, which rose 1.1 percentage points from the previous year, was the second worst on record after 5.4 per cent in fiscal 2002, Japan's Ministry of Internal Affairs and Communications said in a preliminary report. "We had a very tough year," a ministry official said.

During the 12 months, a separate report by the labour ministry said, the ratio of job offers to job seekers was at a seasonally adjusted 0.45, down from 0.77 in fiscal 2008 to the lowest ever level. The ratio means there were 45 jobs available for every 100 job seekers.

The readings reflected a tough employment condition as companies reduced their payrolls amid the lingering effect of the global financial turmoil in 2008 and subsequent economic downturn. But there are mixed views, given the recovery of the Japanese economy.

"After the unemployment rate peaked in July (at 5.6 per cent), Japan has recovered at a relatively fast rate among developed countries," said Kyohei Morita, chief economist at Barclays Capital Japan Ltd.

"That is largely due to improving global economic conditions and subsequent recoveries in Japanese exports. I think we don't need to worry about a double-dip recession." In March alone, the jobless rate deteriorated to 5.0 per cent from 4.9 per cent in February largely due to sluggish conditions for manufacturers.

The result, which marked the first deterioration in four months, was worse than the average market forecast of 4.9 per cent in a Kyodo News survey. The number of jobless people was 3.5 million, up 150,000 from a year earlier for the 17th consecutive month of increase, said the internal affairs ministry.

Analysts say there is a source of concern in the gap between male and female unemployment rates, and that the gap is a sign of sectoral differences. The rate for women improved 0.1 point from February to 4.3 per cent with the healthcare and social welfare industry employing 6.5 million people, up 510,000 compared with the same period a year before.

The jobless rate for men deteriorated 0.4 point to 5.6 per cent on the back of continued weakness in manufacturers, which employed 10.58 million, down 310,000. The construction sector continued to fare poorly with the employment of 4.89 million, down 330,000.

The industry has seen a rise in the number of bankruptcies apparently due to the government's policy of reducing expenditures for public works. A total of 1.11 million people lost their jobs involuntarily, or due to their employers' decisions, up 50,000 on year.

The number of jobholders fell 350,000 to 62.1 million for the 26th consecutive month of decline.

The ratio of job offers to job seekers was at 0.49 in March, up from 0.47 for the third straight month of improvement and recovering to levels unseen since March last year, the Health, Labour and Welfare Ministry said.