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Recent news that the labor market is now the tightest in 43 years — surpassing the peak during the bubble boom from the late 1980s to the early 1990s — underscore the mystifying situation where improving employment conditions do not lead to wage increases or recovery in consumer spending. More policy efforts need to be explored so that the better job prospects will push up workers’ income and dispel their lingering hesitancy to spend.

According to the Health, Labor and Welfare Ministry, the ratio of job openings to job seekers in April hit a nationwide average of 1.48 — topping the bubble-period peak of 1.46 and the highest since 1.53 recorded in February 1974, right after the rapid postwar economic growth came to a halt. The number of new job openings rose a robust 3.2 percent from a year earlier. There were 2.07 job openings to every job seeker in Tokyo, where the labor demand was the tightest among the 47 prefectures, and 1.09 in Hokkaido, where the ratio was the lowest. The jobless rate remained at a 22-year low of 2.8 percent.

Despite the tight labor market, driven by a steady increase in demand in transport, manufacturing, construction and other sectors, wage growth remains stagnant and personal consumption weak. Government data released on the same day showed that per-household consumer spending declined year-on-year for the 14 monthly fall in a row — the longest consecutive decline since the period between March 2008 and April 2009. Employed workers’ wages in April were flat from a year ago on an inflation-adjusted basis. Workers’ wages had only the first year-on-year net gains in six years in 2016. The wage picture is in sharp contrast with the years during the asset-inflated bubble boom, when people’s wages grew by roughly 4 percent a year.

A key difference from the bubble boom is the structure of the labor market. The number of workers in generally low-paying irregular positions such as part-timers increased from 8.17 million in 1989, when their share of the labor force was 19 percent, to 20.23 million in 2016, when they accounted for 37.5 percent of the total. Over the same period, the number of company workers in regular full-time jobs fell from 34.52 million to 33.67 million — even though the figure has been picking up in 2015 and 2016, after falling for the previous seven years.

In fact, business demand for workers in regular full-time positions has been steadily increasing, reflecting the growing labor crunch in many sectors that is expected to intensify as the nation’s working-age population rapidly declines. In April, the ratio of regular job openings to seekers hit 0.97 — the highest since comparable data became available in 2004. Still, nearly 60 percent of the job openings, or 1.53 million out of the total of some 2.68 million in April, are for irregular positions. The employment picture has indeed steadily improved in the moderate recovery under Prime Minister Shinzo Abe’s economic policies. According to a health ministry survey, 97.6 percent of university graduates who sought employment this spring were able to find jobs as of April 1 — the highest ratio since the government began taking comparable data in 1997. Similarly, an education ministry poll showed that 98 percent of high school graduates seeking jobs found employment by the end of March.

The shrinking labor pool due to the aging and declining population only partially explains the tight labor market. Even as the population in the so-called productive age between 15 and 64 continues to decline after hitting a peak of 87 million in 1997 — a fall of roughly 10 million to 76.7 million in 2016 — the number of people with jobs has steadily increased in recent years — from 62.8 million in 2012 to 64.6 million last year. The average number of job openings at businesses in fiscal 2016 hit 2.57 million, the highest on record.

One of the things that can be done to convert the more favorable employment situation into higher incomes for workers is to improve working conditions for the growing ranks of irregular employees. These workers reportedly earn an equivalent of 60 percent of the hourly wages of regular full-time corporate employees. The Abe administration has set a target of narrowing the gap to 80 percent under its “same work, equal pay” agenda, and introduced a guideline that seeks to eliminate irrational discrimination against workers on irregular contracts in regard to wages and other working conditions. However, specific legal steps to turn these guidelines into effective rules to improve the workers’ conditions are still in the making, and a lot will depend on the efforts of their employers. There seems to be a long away to go.