First signs of upturn in Japan

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The Independent Online
Japanese unemployment fell last month from its previous record level, writes Diane Coyle. It provided, along with a substantial increase in industrial output, symbolic confirmation that economic recovery is under way after a five-year slump.

The unemployment rate declined from the post-war record of 3.4 per cent it had set for three months to 3.3 per cent in February. Although a tiny fall, it will be symbolically important. The number of Japanese without work is 2.24 million, 250,000 higher than a year ago.

The number of jobs for every 100 applicants remained unchanged at 67 in February, well up from its low of 61 last year.

The Management and Co-ordination Agency, issuing the figures, cautioned that it was concerned at unemployment among young people, however. Youth unemployment rose by 1.3 percentage points to 7.1 per cent in February, and could climb again after the end of the academic year in March.

Big companies and manufacturers continued to shed jobs last month. Small firms and the service industries - especially communications and retailing and wholesaling - added them.

Industrial output rose 2 per cent in February, reaching a level 2.8 per cent higher than a year earlier, separate figures showed. Shipments of goods jumped 2.4 per cent during the month, an encouraging sign given concerns about the high levels of stocks held by industry.

``It is now apparent that there is an economic recovery. Growth in output looks more solid than expected,'' said Eric Fishwick, an economist at IBJ.