TOKYO — Japan’s struggling economy got another jolt Friday as the government announced that the unemployment rate in May edged up to 4.9 percent, matching the record high last hit early this year.
Japan, the world’s second largest economy, has been unable to break out of a decade-long economic slowdown, its most stubborn and protracted since the end of World War II.
Higher unemployment is particularly worrisome as it damps consumer spending, a key growth engine for an economy already slowing due to waning exports and declining industrial production.
The jobless rate also hit 4.9 percent in December 2000 and January of this year. The rate stood at 4.8 percent in April and 4.7 percent in February and March. May’s rate, announced by the Ministry of Public Management, Home Affairs, Posts and Telecommunications, was in line with economists’ expectations.
The number of employed workers in May fell by 300,000 from a year ago to 64.7 million for the second straight month of decline, the ministry said. The ranks of the unemployed rose by 200,000 to 3.48 million, marking the second straight month of rises.
Signaling the possibility of further job losses in the coming months, the number of employees forced out of work rose by 10,000 in May, marking the first rise in five months, the ministry said. Those who left of their own volition increased by 140,000, representing the second straight month of rises.
The ministry said that all industries except the service sector posted declines in the number of employees in May. The transport and telecommunications sector showed the biggest drop with a 1.7 percent fall from the same month a year ago.
By sector, employed people in manufacturing fell 1.6 percent on year, those in the construction sector dropped 1.2 percent and those in the wholesale and retail sector dropped 0.4 percent. Workers in the service sector rose 1.5 percent.
The ministry also said May’s rise in the jobless rate mainly stemmed from a sharp decline in the number of self-employed people and from a drop of 70,000 in the number of people employed by small firms with up to 29 employees.
Labor conditions in Japan are expected to worsen as the government of reformist Prime Minister Junichiro Koizumi on Tuesday approved an economic reform plan designed to cure the ailing economy with tough structural reforms.
The main pillar of the reforms is to clean up massive bad debts in the banking sector within three years. Between 100,000 and 200,000 people would lose their jobs under the banks’ cleaning efforts.
In a separate survey Friday, the Ministry of Health, Labor and Welfare said the ratio of job offers to job seekers — a key indicator of demand for labor — fell 0.01 point from April to 0.61. The ratio means that 61 jobs were being offered for every 100 workers seeking employment in May.
