The Ministry said the total number of unemployed in Japan was down by 80,000 year on year, marking the 26th straight month of year on year decline. It is not really clear how we should be interpreting this. Could we see in this steady reduction in the numbers of trend unemployment an indicator of Japan's tendency towards a smaller working age population? Certainly the numbers of unemployed remain low, and tend to fluctuate a bit in tandem with the fluctuations in economic activity.
It is also interesting to note that both the economically active population and the numbers of those employed have been declining slowly since reaching a May peak. I think it is too early to reach any decisive conclusion on this, but the data is tantalisingly interesting.
In addition Japan's Ministry of Health, Labor and Welfare reported that the ratio of job offers to job seekers was at 0.98 in January, unchanged from December (ie there were 98 jobs offered for every 100 workers seeking employment last month) while the ratio of new job offers to new job seekers grew to 1.49, up from December's revised figure of 1.43 (ie there were 149 new jobs for every 100 Japanese residents newly seeking employment). The level of job vacancies has effectively remained at a two-year low, indicating there is likely to be little upward pressure on wages.
The consensus opinion would seem to be the "employment is worsening", particularly at small and midsized companies, as expressed by Takehiro Sato, chief economist at Morgan Stanley in Tokyo.
Smaller companies, which employ 70 percent of the workforce, are being hurt by record oil prices and weak domestic demand. Employment among midsized and small companies fell in January while the number of employees increased 7.1 percent among large companies.
