Japan’s jobless rate rose for the first time in ten months in June. Household spending and retail sales fell, raising concerns about the strength of Japan’s domestic economy. But economists say any slump is likely to be short-lived and the country can avoid recession. CCTV America’s Mike Firn reports from Tokyo.
Japan’s jobless rate is rising but there’s more work available than at any time in the past 22 years. While unemployment rose to 3.7% in June from 3.5% in May there were 110 jobs for every hundred applicants.
Economists say there’s a mismatch of supply and demand more women and elderly Japanese are looking for work the most jobs are available in industries like construction where companies are still looking to hire young male workers. The Dean of the Asian Development Bank Institute says Japan`s economy will suffer unless employers change their attitudes.
Fresh sources of domestic demand are vital for Japan’s economy – consumer spending accounts for nearly 60% of gross domestic product and it has been falling since the government raised consumption tax in April. Household spending dropped 3% in June with retail sales down six tenths of one percent.
Okubo says the drop in consumer spending from April through June may have caused the economy to shrink an annualized 6% in the 2nd quarter. But he says recession is avoidable and GDP probably grew around 2.5% this quarter.