There is good news for Japan’s economy — the Japanese job market is experiencing a boom. This is the best the Japanese job market has performed in last 22 years.
New York, NY, USA, May 21, 2016 — There is good news for Japan’s economy — the Japanese job market is experiencing a boom. This is the best the Japanese job market has performed in last 22 years.
Japan’s economy is showing steady signs of recovery. More recently, the country registered an increase in household spending. This has triggered the expectation of employers who have increased hiring in the hope that the domestic economy will perform well in the third quarter.
According to figures released by the Labour Ministry of Japan, the jobs-to-applicant ratio has also increased from 1.09 in May 2015 to 1.10 in June 2015. This figure is close to the numbers witnessed during June 1992 when Japan underwent a brief spell of an asset-inflation bubble burst which eventually lead to the stagnation that the country is fighting even today.
An increasing number of potential employees are trying to make the best of this new development. This is precisely why the jobless rate grew from 3.5 percent in May 2015 to 3.7 percent in June 2015. Given the demand for labour in retail and construction sectors, it is unlikely that the jobless rate will grow further.
The effect of a sales tax hike, which was implemented in April this year, is receding gradually. A Bank of Japan employee cautioned that net exports might see some fluctuations this year. Many of the Japanese companies are in the process of shifting factories and this may affect exports in a negative way.
Nikko-Desjardins, Head of Corporate trading, Stuart Poulson says, “Japan’s economy can benefit greatly from an increase in household spending. However, for household spending to continue to register a rise, it is important that Japanese people be convinced that in the near future, their incomes will rise too.”
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Nikko-Desjardins Asset Management