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No.206(2016/2/24)
Economic and Labour Situation in Japan (February 2016)

Industrial Production
Industrial production is fluctuating indecisively. In December it was down 1.4% from the previous month, registering a decrease for the second consecutive month, and down 1.6% year-on-year, reflecting falling demand for exports amid a slowdown in the Chinese economy. The index in December was 96.5 (seasonally adjusted).

Industries that mainly contributed to the decrease were as follows: (1) general-purpose, production, and business-oriented machinery, (2) electronic parts and devices, and (3) transport equipment, in that order.

According to the Survey of Production Forecast in Manufacturing, production was expected to increase 7.6% in January and decrease 4.1% in February.

For the entire 2015, the industrial output index fell 0.8% from the previous year to 98.2. The production index increased 2.1% in 2014.

Family Income and Expenditure Survey in December
Japan's household spending suffered the biggest annual fall in nearly a year in December, suggesting that slow wage growth is making many households wary of spending.

(1) Expenditure for Two-or-More-Person Households
The average monthly consumption expenditure per two-or-more-person household in December was 318,254 yen, down 4.2% in nominal terms and down 4.4% in real terms year-on-year.

(2) Income and Expenditure for Workers' Households
The average monthly income per household stood at 900,229 yen, down 2.7% in nominal terms and down 2.9% in real terms year-on-year. The average consumption expenditure was 340,474 yen, down 4.8% in nominal terms and down 5.0% in real terms year-on-year.

Labour Force Survey Monthly Results
Japan faces a severe shortage of labour, which is an obstacle for the world's third largest economy as it struggles to break away from deflation.
(1) Employment
The number of employed persons in December was 63.85 million, an increase of 280,000, or 0.4%, over the previous year.

(2) Unemployment
The number of unemployed persons in December was 2.04 million, a decrease of 60,000, or 2.9%, from the same month in the previous year. The seasonally adjusted unemployment rate in December was 3.3%, the same as in the previous month. The unemployment rates for men and women were 3.7% and 2.9%, respectively.

(10,000 persons)
  December figures Change from previous year
      (%)
Population aged 15 years or over 11,077 -3 0.0
Labour force 6,588 21 0.3
Employed persons 6,385 28 0.4
Employees 5,694 49 0.9
Unemployed persons 204 -6 -2.9
Not in labour force 4,482 -26 -0.6
Labour force participation rate (%) 59.5 0.2
Employment rate (%) 57.6 0.1
Unemployment rate, original series (%) 3.1 -0.1
  Current month Change from previous month
Unemployment rate, seasonally adjusted (%) 3.3 0.0

Japan's job availability in December registered the best level in 24 years, with the ratio of job offers to jobseekers standing at 1.27. This figure means that there were 127 jobs available for every 100 jobseekers.

Consumer Prices
The consumer price index in December was 103.5 (2010 = 100), down 0.1 points from the previous month but up 0.2% over the same month of the previous year. The core consumer price index, which includes oil products but excludes volatile fresh food prices, rose 0.1% in December. Consumer price growth remained a long way off the Bank of Japan's ambitious target of 2%.

December 2015
Index Monthly
change (%)
Annual
change (%)
All items 103.5 -0.1 0.2
All items, less fresh food 103.3 -0.2 0.1
All items, less food (less alcoholic beverages) and energy 101.6 -0.1 0.8
All items, less imputed rent 104.4 -0.1 0.2
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