Hiroshi Okuda, chairman of the Japan Business Federation (Nippon Keidanren), said Wednesday that Japanese people cannot tolerate unemployment levels as high as those in other nations.
“Some countries can accept a jobless rate of 10 percent or more.” Okuda said. “But I think an acceptable level (for Japanese people) would be 6 percent to 6.5 percent, because Japanese tend to react emotionally.”
Okuda cited the rate in response to a question about the impact of accelerated disposals of banks’ bad loans.
He also said the government should consider this cultural difference and create a safety net to maintain the stability of Japanese society.
The unemployment rate was 5.4 percent in September but may rise if a government loan-disposal package takes effect.
The figure is expected to rise if the government implements an economic package announced last week intended to clean up the banking system.
Banks are less likely to finance questionable enterprises as they move to clean up their bad loans, thereby forcing many firms into bankruptcy.
“It is difficult to tell how much impact the economic package will have on the economy because it’s not clear whether banks are going to dispose of all bad loans,” Okuda said. “But it’s sure that (the bad-loan cleanup) will put more pressure on (companies and workers) than before.”
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