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No.228 (2017/1/27)
Economic and Labour Situation in Japan (January 2017)
Prime Minister Abe Stresses Work Reforms as New Year's Resolution

Attending a New Year's party hosted by Nippon Keidanren (Japan Business Federation), Japan's largest business organization, Prime Minister Shinzo Abe emphasized that this is the year to follow through on work reforms.

Prime Minister Abe added that unreasonable disparities in treatment between regular and nonregular workers would no longer be tolerated and that he intends to speed up drafting of a law on equal pay for equal work.

However, the approximately 1,900 company executives attending the party did not necessarily react positively to the prime minister's comments.

Industrial Production
The industrial production preliminary report for November showed signs of an increase at a moderate pace. Production and shipments increased, while inventories and inventory ratio decreased.

2010 average=100
  Seasonally adjusted index Original index
  Index Change from previous month (%) Index Change from previous year (%)
Production 99.9 1.5 101.9 4.6
Shipments 99.2 0.9 100.7 5.0
Inventories 107.0 -1.5 110.0 -4.8
Inventory ratio 107.9 -5.5 109.6 -6.6

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

Industries that mainly contributed to the decrease were as follows: (1) ceramics, stone, and clay products, (2) plastic products, and (3) pulp, paper, and paper products, in that order.

According to the Survey of Production Forecast in Manufacturing, production was expected to increase by 2.0% in December and by 2.2% in January 2017.

Family Income and Expenditure Survey in November
(1) Expenditure for Two-or-More-Person Households

The average monthly consumption expenditure per two-or-more-person household in November was 270,848 yen, down 0.9% in nominal terms and 1.5% in real terms year-on-year. The nation's household spending fell for the ninth straight month and poses a persistent challenge to the government's efforts to spur growth momentum in the economy.

(2) Income and Expenditure for Workers' Households
The average monthly income per household stood at 432,415 yen, up 1.6% in nominal terms and 1.0% in real terms year-on-year. The average consumption expenditure was 294,019 yen, down 0.3% in nominal terms and 0.9% in real terms year-on-year.

Labour Force Survey Monthly Results
(1) Employment

The number of employed persons in November was 64.52 million, an increase of 730,000, or 1.1%, over the same month in the previous year. On a year-on-year basis, the fields of education learning support, finance and insurance, and scientific research services added jobs.

(2) Unemployment
The number of unemployed persons in November was 1.97 million, a decrease of 120,000, or 5.7%, from the same month in the previous year. The seasonally adjusted unemployment rate in November was 3.1%, up 0.1 point over the previous month. The unemployment rate for men was unchanged at 3.2%, while that for women was 2.9%, up 0.2 point over the previous month.

(10,000 persons)
  November figures Change from previous year
      (%)
Population aged 15 years or over 11,083 1 0.0
Labour force 6,649 61 0.9
Employed persons 6,452 73 1.1
Employees 5,758 82 1.4
Unemployed persons 197 -12 -5.7
Not in labour force 4,427 -60 -1.3
Labour force participation rate (%) 60.0 0.6 -
Employment rate (%) 58.2 0.6 -
Unemployment rate, original series (%) 3.0 -0.2 -
  Current month Change from previous month
Unemployment rate, seasonally adjusted (%) 3.1 0.1 -

(3) Job availability
Japan's job availability in November was at the highest level since August 1991, with the ratio of job offers to jobseekers standing at 1.41, up 0.01 point over the previous month. This figure means that there were 141 jobs available for every 100 jobseekers. The ratio of new job offers to applicants, a leading indicator for the labour market, rose to 2.11. Japan has likely achieved full employment and faces a severe labour shortage.

Consumer Prices
The consumer price index in November was 100.4 (2010 = 100), the same level as the previous month and up 0.5% over the same month of the previous year. The inflation rate remains far below the 2% target set by the Bank of Japan.

November 2016
Index Monthly
change (%)
Annual
change (%)
All items 100.4 0.0 0.5
All items, less fresh food 99.8 0.0 -0.4
All items, less food (less alcoholic beverages) and energy 100.5 -0.1 0.1
All items, less imputed rent 100.5 0.0 0.6
(10 Major Group Index)   
Food 103.4 -0.1 3.6
Housing 99.8 0.0 -0.2
Fuel, lighting, and water charges 91.0 0.3 -5.8
Furniture and household utensils 99.7 0.3 -0.7
Clothes and footwear 104.8 0.5 1.0
Medical care 101.1 -0.1 0.9
Transportation and communication 98.0 0.2 -1.5
Education 101.9 0.0 1.5
Culture and recreation 101.4 -0.5 0.8
Miscellaneous 100.7 -0.3 0.4
(Goods and Service Group Index)
Goods 100.4 0.1 0.8
Services 100.3 -0.2 0.2
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