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No.207(2016/3/15)
Economic and Labour Situation in Japan (March 2016)

2016 Spring Struggle Gets Underway
This year's spring labour struggle gets off to a full-fledged start with RENGO (Japanese Trade Union Confederation) seeking a base-pay increase of about 2% for the fiscal year starting in April after backing away from its 2015 demand for "more than" 2%. In mid-February company-based unions were scheduled to submit written demands to their company management in coordination with the industrial-level federations to which they are affiliated. Negotiations would then take place between the trade union and management at each company in the hope of concluding a final agreement in March.

In a statement on February 17 Jidosha Soren (Confederation of Japan Automobile Workers' Unions) said that 11 unions representing workers at Japanese auto companies, including Toyota, Nissan, and Honda, were seeking monthly hikes of ¥3,000 ($27). These unions pushed for monthly increases of ¥6,000 last year but ended up with average hikes of ¥3,000.

The first climax in this year's spring struggle will come around March 16-17, when core unions in major sectors like the automobile, electrical, iron and steel, and other metal industries will receive replies from management; small and medium-sized unions will receive replies to their demands later in the month.

Industrial Production
Industrial production is fluctuating indecisively. In January it increased 3.7% over the previous month, registering an increase for the first time in three months, but it was down 3.8% year-on-year. The index in January was 99.8 (seasonally adjusted).

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

According to the Survey of Production Forecast in Manufacturing, production was expected to decrease 5.2% in February and increase 3.1% in February.

Family Income and Expenditure Survey in January
Japan's household spending suffered the biggest annualized fall in nearly a year.
(1) Expenditure for Two-or-More-Person Households
The average monthly consumption expenditure per two-or-more-person household in January was 280,973 yen, down 3.1% in both nominal and real terms year-on-year.

(2) Income and Expenditure for Workers' Households
The average monthly income per household stood at 434,330 yen, down 1.3% in both nominal and real terms year-on-year. The average consumption expenditure was 312,331 yen, down 2.6% in both nominal and 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 January was 63.99 million, an increase of 900,000, or 1.4%, over the previous year.

(2) Unemployment
The number of unemployed persons in January was 2.11 million, a decrease of 200,000, or 8.7%, from the same month in the previous year. The seasonally adjusted unemployment rate in January was 3.2%, down 0.1 point from the previous month. The unemployment rates for men and women were 3.4% and 2.9%, respectively.

(10,000 persons)
  January figures Change from previous year
      (%)
Population aged 15 years or over 11,087 1 0.0
Labour force 6,610 70 1.1
Employed persons 6,399 90 1.4
Employees 5,712 101 1.8
Unemployed persons 211 -20 -8.7
Not in labour force 4,465 -66 -1.5
Labour force participation rate (%) 59.7 0.7
Employment rate (%) 57.8 0.8
Unemployment rate, original series (%) 3.2 -0.3
  Current month Change from previous month
Unemployment rate, seasonally adjusted (%) 3.2 -0.1

Japan's job availability in January registered the best level in 24 years, with the ratio of job offers to jobseekers standing at 1.28, up 0.01 point over the previous month. This figure means that there were 128 jobs available for every 100 jobseekers.

Consumer Prices
The consumer price index in January was 103.0 (2010 = 100), down 0.4 points from the previous month and the same level as the same month of the previous year. Consumer price growth remained a long way off the Bank of Japan's ambitious target of 2%.

January 2016
Index Monthly
change (%)
Annual
change (%)
All items 103.0 -0.4 0.0
All items, less fresh food 102.6 -0.7 0.0
All items, less food (less alcoholic beverages) and energy 100.9 -0.7 0.7
All items, less imputed rent 103.9 -0.5 0.0
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