Jobless rate declined to 5.1% in October

The seasonally adjusted unemployment rate fell for the third straight month in October, offering some hope that the worst may be over for the job market, government data showed Friday.

The rate stood at a better-than-expected 5.1 percent, down from 5.3 percent the previous month, the Internal Affairs and Communications Ministry said in a preliminary report.

Amid increasing exports and industrial output, the nation's jobless rate returned to the lowest level since April and stepped away from the postwar record of 5.7 percent registered in July.

It was lower than the 5.4 percent projected on average by economists surveyed.

"On the surface, it may look better. But it is not a healthy fall in the jobless rate," said Kyohei Morita, chief economist at Barclays Capital Japan Ltd.

Morita said the rate fell because the size of the job market is shrinking as more and more people give up trying to find jobs.

The ratio of job offers to job seekers was at a seasonally adjusted 0.44, up from 0.43 in September, according to data released by the labor ministry. The ratio, improving for the second straight month, means there were 44 jobs available for every 100 job seekers.

The number of job offers rose 0.9 percent from the previous month for the third straight monthly increase, while that of job seekers dropped 1.6 percent, down for the second month running, according to the Health, Labor and Welfare Ministry.

The jobless rate for men fell 0.3 percentage point from the previous month to 5.3 percent, and that for women declined 0.1 point to 4.8 percent.

Still, the internal affairs ministry warned that the environment surrounding the job market remains severe, noting that the number of jobless people rose by 890,000 from a year earlier to 3.44 million for the 12th straight monthly expansion.

Of the total, 1.16 million lost their jobs involuntarily due to the decisions of their employers, up 550,000 from a year before, the ministry said.

The number of jobholders stood at 62.71 million, down 1.17 million from a year earlier, marking the 21st straight month of decline.

The labor figures were released a week after the government said the economy has slipped back into deflation.

Despite improvements in the figures, it is becoming increasingly uncertain whether Japan can achieve a solid recovery in the near future, amid falling consumer prices and adverse effects of the rising yen on the nation's export-driven economy, economists said.

"The rise of the yen would not have an immediate impact on the labor market. But if the rise continues, it will drive up the country's unemployment rate in the months ahead," Morita said.

The number of jobholders in the manufacturing sector fell by 880,000, larger than a contraction of 810,000 in September, from a year earlier to 10.05 million.

In the services sector, jobholders fell by 340,000 to 4.69 million, compared with a decline of 200,000 the previous month.

A labor ministry survey showed Friday that 246,847 nonregular workers have lost or are expected to lose their jobs in the period from October last year through next month.

The figure grew by 2,539 from the previous survey in October, the Health, Labor and Welfare Ministry said.

In this month alone, the number of nonregular workers who lost or are expected to lose their jobs stood at 1,688.

Although the number of nonregular workers who are expected to lose their jobs in December stands at a smaller 750, a ministry official said the developments need to be closely watched as more companies tend to terminate contracts at the end of a calendar year.

By prefecture, Aichi, the home of Japan's auto industry, where Toyota Motor Corp. and affiliated parts suppliers are based, topped the list with 41,145 nonregular workers who lost or are expected to lose their jobs, followed by Tokyo with 11,000.

The ministry compiled the survey by tabulating figures as of Nov. 18.