Japan Gets Dismal Data Amid Worries Over Recovery
By Yoko Nishikawa
TOKYO (Reuters) - Japan's struggle to emerge from a decade-long slump looked to be in more trouble on Tuesday, with data showing a rise in unemployment and a dip in household spending seen as key to recovery.
Another dismal pointer to the economy's fragility was the announcement that consumer prices in Tokyo fell by a one percent this year, a record decline.
Japan's jobless rate rose to 4.8 percent in November from 4.7 percent the previous month, while spending by wage earners' households fell a real 2.3 percent in November from a year earlier, the Management and Coordination Agency (MCA) said.
The jobless rate hit a record 4.9 percent in February and March.
The figures are bad news for Japanese policy-makers, who are desperate to get the world's second-largest economy on a self-sustaining recovery path.
Other signs of a slowdown in Japan's recovery have recently begun appearing, with growth in exports and corporate capital spending, the key driving forces of the recovery so far, both decelerating.
Despite a near-record high jobless rate, an MCA official pointed to some bright spots, saying the number of people in work rose in November, meaning the job market is expanding.
``The jobs situation is not all bad because although the unemployment rate worsened in November, the number of employees increased,'' he said.
The jobs-to-applicants ratio rose to 0.65 in November, meaning there were 65 openings for every 100 job seekers, up marginally from 64 in October, the Labor Ministry said.
Stagnant job conditions, along with weak income conditions, have been partly blamed for weak personal consumption -- the largest and weakest chunk of the economy.
``Personal consumption continues to be weak,'' said Masato Okamoto, a senior MCA official told reporters.
The household spending data showed that income rose 0.6 percent in November in real terms, but it fell 0.1 percent in nominal terms, the 17th consecutive month of decline.
Amid stagnant consumer spending, fierce competition resulted in a fall in prices of durable goods and dining out, dampening consumer prices, said Hideyuki Suzuki, head of the price research division at the Economic Planning Agency (EPA).
``Consumer prices are somewhat weak,'' Suzuki said.
Nationwide consumer prices in November dipped 0.5 percent year-on-year, down for a record 15th consecutive month. Tokyo area consumer prices, which precede nationwide data by one month, dipped 0.6 percent in December from a year earlier for a record 16th consecutive month of decline, the MCA said.
In calendar 2000, Tokyo area consumer prices fell 1.0 percent from the previous year, the biggest fall since 1971, the earliest year for which comparisons are available under present calculation methods.
It is the first time Tokyo consumer prices have fallen for two years in a row. |
