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Jobs, economic data give new hints of Japan recovery
TOKYO. July 1 Japan today received some fresh hints of recovery in its struggling economy. with the jobless rate dropping further in May and workers' real Incomes rising for the first time in I 1 months, says Reuters.
But key data on personal spending — the largest and one of the weakest components of the economy — fell short of confirming a long-awaited durable recovery from Japan's worst postwar slump
An economists said that while the lower jobless figure was a good sign, it was too soon to say concern over employment had been eradicated aiid that the disappointing household spending data highlighted another job-related problem — incomes weren't growing fast enough.
Japan's unemployment rate fell to 4.6 per cent in May. down from 4.8 per cent in April. Itself an Improvement on a record high of 4.0 per cent tn February and March.
Labour Minister Takamori Makino was quoted by Finance Minister Kllchl Miyazawa as saying at Friday’s Cabinet meeting that there were clear signs of brightness in the jobless figures.
However, a Management and Coordination Agency official warned It was too early to declare the worst was over despite positive signs such as a year-on-year rise in the number of salaried employees — the first in eight months — a view shared by economists.
It is too early to say there are no worries over the job situation. But we need Io wait a while long to Judge if it's really Improving." said Yasuko Oshima. economist at Fuji Research Institute.
"But the increase in the number of. workers Is a good sign It Indicates new jobs may be created In the information technology industry, and that strong corporate activity has begun to Improve the employment situation.
Other government data showed wage earners' real incomes. adjusted for inflation or deflation, rose 0.7 per cent in May from the previous year, the first increase in I I months.
"The good news is there are signs workers' Incomes have stopped declining.'' the official said.
The government hopes an upturn in long-depressed household incomes will spur private spending, the missing link to a sustainable recovery.
The Bank of Japan, too. sees workers' incomes as a vital clue in judging when to end Its ultra-easy monetary policy - in place for more than 16 months — of guiding short-term interest rates virtually to zero.
Friday's data also showed real spending by wage earners' households fell 1 2 per cent in May from a year before. Indicating private consumption, which comprises 60 per cent of Japan's gross domestic product, remains sluggish