May jobless rate flat from April at 4%, no. of unemployed up

TOKYO, June 28 Kyodo - Japan's seasonally adjusted unemployment rate stood at 4.0 percent in May, unchanged from the previous month, but the number of jobless people logged the
biggest increase in more than five years, the government said Friday.

The number of jobless people totaled 2.70 million, up 120,000 from a year
earlier, the largest growth since 130,000 recorded in January 2003, the
Ministry of Internal Affairs and Communications said in a preliminary report.

It was the second straight month of growth following an expansion of 70,000 in
April. A ministry official said both the number of those who voluntarily quit
their jobs and that of those dismissed from them were on the rise in the
reporting month.

The ministry left unchanged its basic assessment that a recovery in Japan's
employment ''has stalled.'' The official also upheld the view that such an
assessment ''has been slightly skewed downwards.''

He pointed out that the number of women who have stopped job searches increased
in May and that the number of elderly who involuntarily left their jobs also
rose in the reporting month.

A separate report, which the Ministry of Health, Labor and Welfare released,
said the ratio of job offers to job seekers in May was at a seasonally adjusted
0.92, down from 0.93 in April for the fourth straight monthly drop.

That means there were 92 jobs available for every 100 job seekers.

The May unemployment rate was in line with the average market projection of 4.0
percent in a Kyodo News survey. The job-offers-to-job-seekers ratio also
matched the average market forecast.

According to the labor ministry, the number of job offers grew 1.7 percent in
May from the previous month and that of job seekers climbed 2.3 percent. The
number of new job offers fell 15.6 percent from a year before.

Kyohei Morita, chief economist at Barclays Capital Japan Ltd., said even though
the May headline unemployment rate was unchanged from April, ''We can see magma
rising up that will push up the jobless rate.''

He said that worsening confidence among companies amid slumping exports and a
profit squeeze from high raw material prices will curb firms' demand for labor.

Morita said that at the moment, deterioration in domestic economic conditions
is dampening firms' willingness to hire more people following the retirements
of baby boomers.

Also, a law revision which requires firms to promote the upgrading of part-time
workers' status to full-time is putting a brake on companies' interest in
hiring, Morita added. The revision took force in April.

According to the internal affairs ministry, the jobless rate for men stood at
4.2 percent in May, up 0.2 percentage point from April to hit the highest level
since December 2006, when the same 4.2 percent was recorded.

The rate for women shed 0.2 point from April to 3.7 percent.
The number of jobholders sank 210,000 from a year earlier to 64.78 million,
registering the largest decline since 370,000 in June 2004. It was also the
fourth straight monthly drop.

The number of male jobholders totaled 37.75 million, down 150,000 from a year
before, while the number of female workers was down 50,000 to 27.04 million.

The number of people who voluntarily quit their jobs grew 50,000 to 950,000
from a year earlier, while people who were laid off totaled 640,000, up 60,000.

By industry, the number of jobholders continued to fall in the construction
sector, but that in the medical and welfare sector rose.

By company size, the number of employees shrank in firms with less than 500
workers compared with a year earlier, but rose in enterprises with 500 or more
staff. The results underline the gap in business confidence between small and
large firms.==Kyodo