The FINANCIAL -- The Japanese government on October 23 unveiled an emergency package to create 100,000 jobs by the end of the fiscal year in March, a bid to prevent gloomy employment conditions from derailing a fragile economic recovery.
Japan's jobless rate hit 5.5% in August, slightly off its worst-ever reading of 5.7% in July. There were 3.61 million unemployed, up 890,000 from the previous year. Analysts say the picture will likely worsen in the months ahead, as companies refrain from increasing their workforces due to the hazy economic outlook.
The Cabinet Office said the emergency package will focus mainly on sectors that have significant growth potential, such as nursing care, agriculture and the environment.
"Jobs will be created by easing regulatory hurdles to getting nursing-care licences, helping job-seekers find work in the agricultural and environmental sectors, and assisting young people in getting jobs in rural areas," Nikkei.com says.
The government will also improve the safety net for the unemployed, providing emergency lodgings and easy-term loans, and supplementing services at public employment-security offices, such as easing the application process for welfare payments.
The money for these programs will come from the current budget compiled by the previous Liberal Democratic Party-led government, meaning that the current Cabinet won't spend any new money on them.
The measures are still precautionary in nature, as the government is holding back from committing new money, watching signs of recovery in other sectors pointing toward a sustained recovery.
Employment conditions have become increasingly difficult in Japan in recent months. The jobs-to-applicants ratio stood at its worst-ever 0.42 in August, meaning there were only 42 jobs available for every 100 job seekers. Housewives and retired workers have been forced to join the job search to supplement household incomes.
UBS Securities senior economist Takuji Aida said doubts remain about the effectiveness of the new package. Adding 100,000 jobs would just be a marginal improvement compared with the number of jobs lost so far this year.
"This measure is a necessary step because the fact that the government is doing something to create jobs is important to improve consumer sentiment," Aida said. But the scale of the program isn't large enough, he added.
Earlier this week, Deputy Prime Minister Naoto Kan said the government is considering taking further steps to support employment next year, if necessary.
Related Stories
