Home >News >World >Japan’s jobless rate edges up to a three-year high
The jobless rate rose to 3% from 2.9% in July, the internal affairs ministry reported Friday, the highest since May 2017 (AP Photo/Eugene Hoshiko) (AP)
The jobless rate rose to 3% from 2.9% in July, the internal affairs ministry reported Friday, the highest since May 2017 (AP Photo/Eugene Hoshiko) (AP)

Japan’s jobless rate edges up to a three-year high

Japan’s unemployment rate ticked up to a three-year high in August as the coronavirus continued to weigh on the labor market and the economy’s recovery.

Japan’s unemployment rate ticked up to a three-year high in August as the coronavirus continued to weigh on the labor market and the economy’s recovery.

The jobless rate rose to 3% from 2.9% in July, the internal affairs ministry reported Friday, the highest since May 2017. The result matched the median forecast from analysts.

Key Insights

  • Recent gains in factory production and retail sales signal the worst is over for the economy, but the Bank of Japan’s Tankan survey this week showed businesses remain very downbeat, especially the small companies that employ most of Japan’s workers. That suggests a recovery in hiring could be a long way off.
  • Still, despite a second monthly uptick in the unemployment rate, Japan has suffered far fewer job losses than other major economies during the crisis. Legal precedents protecting full-time workers and big cash buffers on corporate balance sheets have helped prevent more layoffs, along with cheap loans and wage support from the government to keep workers on the payroll.
  • A solid recovery for the economy and the labor market depends largely on the path of the pandemic. Automakers and other manufacturers are picking up, but a resurgence of the virus in Europe and other key export markets clouds the outlook. At home, bans on international tourists continue to weigh heavily on hotels and restaurants.

What Bloomberg’s Economist Says

“The service sector continues to face pressure from efforts to curb the spread of the virus -- hurting demand for workers in the most labor-intensive part of the economy. A delay in easing of virus-containment measures for large entertainment venues such as stadiums and concert halls is a headwind."

--Yuki Masujima, economist

This story has been published from a wire agency feed without modifications to the text.

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