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No.209(2016/4/6)
Economic and Labour Situation in Japan (April 2016)

On March 25 RENGO (Japanese Trade Union Confederation) carried out its second tally of wage hike settlements reached in the 2016 Spring Struggle for a Better Life. RENGO's survey revealed that 1,183 unions that had demanded average wage hikes for members and engaged in labour-management negotiations had reached settlements by that time. The average wage hike in these settlements (including the regular wage hike) was 6,335 yen, the equivalent of 2.10% of the average wage before the hike. This figure was 6 yen less than at the same stage last year but up 0.02 percentage points.

Industrial Production
Industrial production is fluctuating indecisively. In February it decreased 6.2% from the previous month, registering a decrease for the first time in two months, and it was down 1.5% year-on-year. The index in February was 93.6 (seasonally adjusted).

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

According to the Survey of Production Forecast in Manufacturing, production was expected to increase 3.9% in March and 5.3% in April.

Family Income and Expenditure Survey in February
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 February was 269,774 yen, up 1.6% in nominal terms and up 1.2% in real terms year-on-year.

(2) Income and Expenditure for Workers' Households
The average monthly income per household stood at 478,624 yen, down 2.0% in nominal terms and down 2.4% in real terms year-on-year. The average consumption expenditure was 297,662 yen, up 2.2% in nominal terms and up 1.8% 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. The unemployment rate has been sound in the 3.2%-3.4% range since March 2015.
(1) Employment
The number of employed persons in February was 63.51 million, an increase of 290,000, or 0.5%, over the previous year.

(2) Unemployment
The number of unemployed persons in February was 2.13 million, a decrease of 130,000, or 5.8%, from the same month in the previous year. The seasonally adjusted unemployment rate in February was 3.3%, up 0.1 point over the previous month. The unemployment rates for men and women were 3.6% and 2.8%, respectively.

(10,000 persons)
  February figures Change from previous year
      (%)
Population aged 15 years or over 11,070 –4 0.0
Labour force 6,564 16 0.2
Employed persons 6,351 29 0.5
Employees 5,684 89 1.6
Unemployed persons 213 –13 –5.8
Not in labour force 4,502 –18 –0.4
Labour force participation rate (%) 59.3 0.2
Employment rate (%) 57.4 0.3
Unemployment rate, original series (%) 3.2 –0.3
  Current month Change from previous month
Unemployment rate, seasonally adjusted (%) 3.3 -0.3

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

Consumer Prices
The consumer price index in February was 103.2 (2010 = 100), up 0.1 point over the previous month and up 0.3% over the same month of the previous year. The inflation rate remains far below the 2% target set by the Bank of Japan, which expects to achieve that goal around the first half of the fiscal year starting April 2017.

February 2016
Index Monthly
change (%)
Annual
change (%)
All items 103.2 0.1 0.3
All items, less fresh food 102.5 0.0 0.0
All items, less food (less alcoholic beverages) and energy 101.1 0.2 0.8
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