• Kyodo

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Japan's job availability in May logged its sharpest monthly drop in over 46 years, while the unemployment rate rose to a three-year high, adding to signs that the labor market is rapidly tightening due to the coronavirus pandemic, government data showed Tuesday.

The job-to-applicant ratio worsened to 1.20 from 1.32 in April, the steepest month-to-month fall since a record 0.20 point drop in January 1974, when the Japanese economy entered a downturn phase in the wake of the global oil crisis, according to the Ministry of Health, Labor and Welfare.

With 120 job openings for every 100 job-seekers, the country's latest job availability rate decreased for the fifth straight month to hit its lowest level since July 2015, the labor ministry said.

Separate data from the Ministry of Internal Affairs and Communications showed the jobless rate in May grew to 2.9 percent from 2.6 percent in April for the third consecutive monthly increase, hitting its highest level since the 3.1 percent logged in May 2017.

The unemployment rate rose for three straight months for the first time since it worsened for six months in a row from February to July in 2009 in the aftermath of the global financial crisis, according to the data.

The results show the pace of labor market deterioration accelerated under the government's state of emergency declaration made in response to the virus, which was lifted completely on May 25 with requests withdrawn for restrictions on economic activities.

"The employment situation is severe, with the number of job offers continuing to fall sharply and the number of job-seekers increasing at the same time," labor minister Katsunobu Kato said at a news conference.

During the state of emergency, which was in place from April, the government asked businesses to suspend operations and people to refrain from making nonessential outings to prevent the further spread of the virus. The measure took a heavy toll on the economy.

Takuya Hoshino, an economist at the Dai-ichi Life Research Institute, said many of those who had lost their jobs resumed job-hunting in May, apparently following the end of the state of emergency, which contributed to the higher jobless rate in the reporting month.

Individual proprietors and employees forced to be temporarily absent from work decreased to 4.23 million from 5.97 million in the previous month, but up 2.74 million from a year earlier.

While the deterioration of job availability and unemployment rate was "within expectations," Hoshino said the amount of temporarily absent workers was "unexpectedly large," which he said is a "great concern."

"Some of the absent workers will start looking for a new job and be counted as unemployed," he said. "The number of such people is highly likely to keep increasing, so the jobless rate has yet to reflect the ongoing severe employment situation properly."

In the reporting month, the job availability ratio in Okinawa Prefecture fell to 0.78, and the figures for six other prefectures among the nation’s 47 sank below the threshold of 1, the labor ministry said.

New job offers decreased 32.1 percent from a year before, with those from the accommodation and food service sector plunging 55.9 percent and from firms in the lifestyle and entertainment-related fields, including travel agencies, sinking 44.2 percent.

The seasonally adjusted number of unemployed increased 190,000 from April to 1.97 million. Among them, 740,000 voluntarily left their jobs, up 40,000 from a month earlier, while 520,000 were new job-seekers, up 20,000, and another 520,000 were laid off, up 70,000.

Before seasonal adjustment, the number of people in work in April fell 760,000 from a year earlier to 66.56 million, down for the second straight month, including 29.54 million women, down 330,000.

The number of people not in the labor force stood at 42.21 million, up 370,000 from a year earlier, following a 580,000 rise the previous month.

A government official told reporters those figures apparently show that many of those who had lost their job gave up on seeking a new one.

"Since economic activities have been gradually resuming in June following the end of the state of emergency, we believe that some of them will return to work," a government official said. "But we have no idea whether the downward trend of the number of employed people will change, so we need to pay closer attention to it."

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