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Economic and Labour Situation in Japan (October 2013)

Prime Minister Shinzo Abe on October 1 announced that the government will raise the consumption tax rate from 5% to 8% on April 1, 2014, as scheduled, to maintain confidence in the country and hand over a sustainable social security system to the next generation. The consumption tax rate is scheduled to be raised to 10% by October 2015.

At the same time, Prime Minister Abe unveiled a 5 trillion yen stimulus package to offset some of the immediate negative effects of the tax hike, including a 15,000 yen cash payment to 24 million people in low-income households and various tax cuts totaling about 1 trillion yen.

Industrial Production
Industrial production in August decreased by 0.7% from the previous month and registered a year-on-year decline of 0.2%. The index in August was 97.2 (seasonally adjusted).
Industries that mainly contributed to the decrease were as follows: (1) general-purpose production and business-oriented machinery, (2) chemicals (excluding drugs), and (3) transport equipment, in that order.
Commodities that mainly contributed to the decrease were as follows: (1) large passenger cars, (2) metal oxide semiconductor ICs (memory), and (3) reaction vessels, in that order.
According to the Survey of Production Forecast in Manufacturing, production was expected to increase by 5.2% in September and 2.5% in October.

Family Income and Expenditure Survey in July
(1) Expenditure for Two-or-More-Person Households
The average monthly consumption expenditure per two-or-more-person household in August was 284,646 yen, down 0.5% in nominal terms and down 1.6% in real terms year-on-year.
(2) Income and Expenditure for Workers' Households
The average monthly income per household stood at 471,411 yen, up 0.2% in nominal terms and down 0.9% in real terms year-on-year.
The average consumption expenditure was 312,622 yen, up 0.6% in nominal terms and down 0.5% in real terms year-on-year.

Labour Force Survey Monthly Results
(1) Employment
The number of employed persons in August was 63.10 million, an increase of 290,000, or 0.5%, over the same month in the previous year.
(2) Unemployment
The number of unemployed persons in August was 2.71 million, a decrease of 60,000, or 2.2%, from the same month in the previous year.
The seasonally adjusted unemployment rate was 4.1%, up 0.3 points over the previous month.

(10,000 persons)
  July figures Change from previous year
Population aged 15 years or over 11,086 -9 -0.1
Labour force 6,581 22 0.3
Employed persons 6,310 29 0.5
Employees 5,562 51 0.9
Unemployed persons 271 -6 -2.2
Not in labour force 4,499 -35 -0.8
Labour force participation rate (%) 59.4 0.3 -
Employment rate (%) 56.9 0.3 -
Unemployment rate, original series (%) 4.1 -0 -
  Current month Change from previous month
Unemployment rate, seasonally adjusted (%) 4.1 -0 -

According to a separate report released by the Ministry of Health, Labour and Welfare, job availability improved slightly in August 2013, with the ratio of job offers to jobseekers standing at 0.95, up 0.01 point over the previous month. This figure means that there were 95 jobs available for every 100 jobseekers.

Consumer Prices
The consumer price index in August was 100 (2010 = 100), up 0.3% over the previous month and up 0.9% over the same month of the previous year.

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