Economic and Labor Situation in Japan, April 2026

2026 Spring Struggle for a Better Life

On April 3, RENGO (the Japanese Trade Union Confederation) carried out its third tally of the 2026 spring labor-management wage negotiations (Shunto). It reported that the average wage increase rate for full-time employees-combining base pay raises (base-up) and regular pay scale increases-stood at 5.09%. This marks the third consecutive year in which the increase has exceeded 5%.

RENGO’s survey revealed that 2,311 unions that had demanded average wage hikes for members and engaged in labor–management negotiations had reached settlements by that time.

The average wage hike in these settlements (including the regular wage hike) was 16,892 yen, the equivalent of 5.09% of the average wage before the hike: less than at the same stage last year at 466 yen and 0.33 percentage points.

At unions with more than 1000 members, the average wage hike was 17,237 yen, up 5.05%: less than at the same stage last year at 726 yen and 0.43 percentage points.

At unions with fewer than 300 members, the average wage hike was 13,960 yen, up 5.00%: more than at the same stage last year at 600 yen and 0.00 percentage points, and remaining in the 5% range for the second straight year.

The gap in wage increase rates between large unions with 300 or more members and smaller unions was 0.09 percentage points, narrowing from 0.44 points last year.
For fixed-term and part-time workers, hourly wages rose by 6.61%: more than the average wage increase rate for full-time employees.

Labor Force Survey Monthly Results 1

(1) The number of employed persons in February 2026 was 67.79 million, an increase of 110,000 over the same month the previous year. By gender, this included 36.82 million men, up 10,000, and 30.97 million women, up 100,000 over the previous year.

(2) Unemployment
The number of unemployed persons in February was 1.80 million, up 150,000 over the same month in the previous year.
The seasonally adjusted unemployment rate in February was 2.6%, down 0.1 points, improving for the first time in seven months, partly reflecting workers who had voluntarily left their jobs eventually finding employment. The unemployment rate was 2.8% for men, down 0.1 points, and 2.4% for women, down 0.1 points from the previous month.

Units: 10,000 persons

(3) Job Availability
Japan’s job availability in February stood at 1.19, up 0.01 over the previous month. This ratio means there were 119 job openings for every 100 job seekers.
The ratio of regular employee job offers to applicants was 0.99, unchanged from the previous month.
The ratio of new job offers to applicants, a leading indicator for the labor market, was 2.10, down 0.01 from the previous month. The number of new job offers decreased 7.8% from the same month the previous year. By industry, new job offers fell 17.9% in the wholesale and retail sector, 17.0% in the living-related and personal services and amusement services sector, and 14.7% in the hotel and restaurant sector.

Industrial Production 2

Industrial Production Fluctuates Indecisively
Industrial output in February decreased 2.1% from the previous month, the first contraction in three months, dragged down by weak output in the motor vehicle sector.
Production and shipments decreased, while inventory and inventory ratio increased. The industries that mainly contributed to this decrease were as follows: (1) motor vehicles; (2) fabricated metals; and (3) electronic parts and devices, in that order.
According to the Survey of Production Forecasts in Manufacturing, production was expected to increase 3.8% in March and 3.3% in April.

February  2026           2020 average = 100

Family Income and Expenditure Survey 3

This data is a key indicator of private consumption, which accounts for more than half of Japan’s gross domestic product.
(1) Expenditure of Households of Two Persons or More
Average monthly consumption expenditure of households of two or more persons in February was 289,391 yen, down 0.4% in nominal terms and down 1.8% in real terms from the previous year.

(2) Income and Expenditures for Workers’ Households
Average monthly income per household stood at 589,038 yen, up 3.0% in nominal terms and up 1.6% in real terms from the previous year. The average level of consumption expenditure was 319,797 yen per month, up 1.9% in nominal terms and up 0.5% in real terms year-on-year.

Consumer Prices 4

The consumer price index (CPI) in February was 112.2 (2020 = 100), up 1.3% over the previous year but down 0.6% from the previous month, the slowest rise in two years, with the abolition of a provisional gasoline tax contributing to the deceleration. Core inflation (CPI less food and energy) was up 2.5% over the previous year and up 0.1% over the previous month, largely reflecting the government’s subsidy program to curb electricity bills from January to March. The inflation rate has remained at or above the Bank of Japan’s 2% price stability target since November 2022.

Food prices, excluding fresh items, climbed 5.7% over the previous year in February, driven by surging costs for items such as rice,chocolate, and coffee beans. Energy costs fell 9.1% after a drop of 5.1% in January, with gasoline plunging 14.9% from the year before, the sharpest decline since May 2020. Japan’s provisional gasoline tax was scrapped on Dec. 31 as the government sought to ease the burden on households hit by persistent inflation.

February 2026

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