Seasonally Adjusted Unemployment Rate Reaches the 5.0% Mark in July

For the first time since government unemployment surveys started in 1958, the adjusted monthly unemployment rate reached the 5% mark, breaking the previous worst of 4.9% set last month.

For many years, Japan saw its unemployment rate hold steady around the 2-3% level, even during periods when other developed nations suffered from high unemployment. The 5% unemployment rate therefore raises serious questions regarding the country's future.

Nikkeiren has already submitted an emergency employment program that includes measures to increase employment in the public service sector, but following the announcement of the latest unemployment rate figure by the Ministry of Public Management, Home Affairs, Posts and Telecommunications on August 28, the Japan Chamber of Commerce and Industry as well as labor organizations such as Rengo and Zenroren (the National Confederation of Trade Unions) also followed suit with statements released on the same date.

According to the survey, total unemployment reached 3.3 million persons (2.03 million men and 1.27 million women). Employment declines were particularly steep in the manufacturing sector (minus 580,000 from last year) and the construction sector (minus 210,000). While employment increased in other sectors, these losses, coupled with a decline in independent operators of shops and factories, caused overall employment to decline by 370,000 to 64.52 million.

Because Prime Minister Koizumi's structural reform measures are expected to result in an increase in the number of workers dismissed from their jobs against their will, the Japanese employment market will require very careful monitoring.