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Japan’s unemployment rate fell to 2.9% in June, reflecting a pickup in hiring at restaurants and retailers hit hard by the coronavirus pandemic as a state of emergency was lifted in some areas, government data showed Friday.

The seasonally adjusted jobless rate dropped from 3.0% for May, improving for the first time since March, the Internal Affairs and Communications Ministry said.

The job availability ratio improved to 1.13 from 1.09 a month earlier, the Health, Labor and Welfare Ministry said. The latest figure of 1.13 means that there were 113 openings for every 100 job-seekers.

Japan lifted its third state of emergency, which asked bars and restaurants to suspend their operations, other establishments to close early and the general public to refrain from unnecessary outings, in nine prefectures including Tokyo in late June. Only Okinawa Prefecture remained under the measure.

But the capital was once again put under a state of emergency in mid-July amid a resurgence of infections, and four other prefectures are now expected to be added to the measure, clouding the outlook for the employment environment.

Looking at figures unadjusted for seasonal factors in the reporting month, the total number of unemployed people increased 110,000 from a year earlier to 2.06 million, but people in work also rose 220,000 to 66.92 million, the ministry said.

By sector, accommodation and restaurant services, hit hard by the pandemic, logged the first year-on-year gain in the number of workers in 18 months, up 130,000 from the previous year to 3.82 million.

The wholesale and retail fields saw an increase of 490,000 from a year ago to 10.71 million, adding the largest number of jobs among others.

Among those without jobs, 770,000 people voluntarily left their jobs, up 50,000, while 530,000 were new job-seekers, up 30,000.

The number of people laid off declined by 10,000 to 600,000, down for the first time in 17 months. A ministry official said that shift could be regarded as a “turning point,” along with the increase of employees at hotels and eateries.

Compared with a pre-pandemic figure, however, the official told reporters that the number of people on payrolls was still at a low level, saying that it was 550,000 lower than the 67.47 million in June 2019.

Takuya Hoshino, a senior economist at the Dai-ichi Life Research Institute, said the number of workers has been falling on a seasonally adjusted basis since the beginning of this year as the government repeatedly issued virus emergencies, but that the downward trend is “coming to a halt.”

Hoshino pointed out that more bars and restaurants are increasingly defying the government’s requests amid repeated virus emergencies and that the increase in the number of people employed by hotels and eateries may be an indication of this.

“The situation over the spread of virus infections is getting worse for sure, and the employment environment in the accommodation and food service industries could worsen again,” he said.

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