Japan Real Time Charts and Data

Edward Hugh is only able to update this blog from time to time, but he does run a lively Twitter account with plenty of Japan related comment. He also maintains a collection of constantly updated Japan data charts with short updates on a Storify dedicated page Is Japan Once More Back in Deflation?

Monday, October 01, 2007

September Tankan and August Earnings

The September Tankan index of sentiment at large manufacturers came in with a more or less neutral reading. At 23 it was unchanged from June. Since people were expecting worse this is being generally well received, but beyond that I have little more to say, since we need to await data.

Also out today was the Provisional Report of the Monthly Labour Survey for August 2007, and here I do have rather more to say. As I keep stressing, to understand what is going on in Japan you need to look beyond the headlines to the actual data. And one more time Bloomberg haven't disappointed me.

Unemployment near a nine-year low is beginning to spur wages in the world's second-largest economy. Wages increased 0.1 percent in August, the Labor Ministry said today, the first gain in nine months.

First off it was total cash earnings that were up 0.1% y-o-y, and not real wages which were actually up rather more at 0,4% (I really have no idea how they simply manage to get everything wrong at the level of detail). So here is the chart of monthly changes on a year on year basis.

But... and here comes the really important rub in all of this... if you go and check the time series for the index you will find that August 2006 was a bad month for earnings, since total earnings were down 0,2% on a year earlier in August 2006, so even this meagre increase in August is hard to interpret, and certainly doesn't tell you that "unemployment near a nine-year low is beginning to spur wages" which I think was the point behind the Bloomberg story.

Here is the index itself for what it is worth, although as you can see with bonuses and other items there is a lot of monthly movement and it must be very hard to establish the trend here.All the same, when you look at it in context, August 2007 doesn't seem to me to be a particularly exciting reading.