In 2024, Japan’s unemployment rate saw a slight improvement, falling to 2.5%, which was a 0.1 percentage point decrease compared to the previous year. This decline in the jobless rate came as fewer workers were laid off, partly due to a shortage of workers across many sectors. According to government data released on January 31, 2024, the labor market in Japan has shown steady recovery after the challenges posed by the COVID-19 pandemic.
Job Availability Ratio
Along with the decline in unemployment, the job availability ratio—the number of job openings for every 100 job seekers—also dropped. In 2024, the ratio stood at 1.25, marking a decrease of 0.06 points from the previous year. This drop in the ratio was the first decrease in three years, signaling that the demand for workers had slowed down slightly. Despite this decline, the ratio remained above one, meaning there were still more job openings than there were job seekers.
The ratio in 2024 was lower than the pre-pandemic level of 1.60 in 2019, but still a sign of a relatively healthy job market. This ratio is important because it gives a clear picture of the balance between the number of available jobs and the number of people looking for work. It shows that while there were fewer job openings compared to the previous year, there were still plenty of opportunities for job seekers.
Labor Market Conditions
Labor Minister Takamaro Fukuoka addressed the situation, saying that the employment market in Japan had been solid and was recovering at a moderate pace. He noted that while there had been some slowdown in the job availability ratio, the overall job market was still in good shape, with unemployment rates remaining low.
The average unemployment rate of 2.5% in 2024 was the lowest Japan had seen since 2019, just before the pandemic began to affect the global economy. In 2019, the unemployment rate was 2.4%, making the 2024 figure quite close to pre-pandemic levels.
Unemployment Trends
The number of unemployed people in Japan also saw a decline. In 2024, the total number of unemployed individuals decreased by 20,000 people, bringing the total down to 1.76 million. This marked the third consecutive year of a falling unemployment rate, which is a positive sign for the country’s economy. At the same time, the number of employed individuals grew by 340,000 to reach a record high of 67.81 million, which was an increase for the fourth consecutive year.
Interestingly, Japan’s non-labor force population—meaning people who are neither working nor looking for work—declined by 530,000 people, bringing the total number of non-labor force individuals to 40.31 million. This decline, which also marked the fourth consecutive year of decrease, is another indicator of the growing participation in the workforce.
Voluntary Resignations and Layoffs
Regarding the reasons people left their jobs, there were two main categories: those who were laid off by their employers and those who voluntarily resigned, usually to find better job opportunities. In 2024, the number of people laid off dropped by 30,000 to a total of 220,000. This decrease in layoffs suggests that many workers who were dismissed were able to quickly find new jobs, showing a degree of flexibility and resilience in the labor market.
On the other hand, the number of people who voluntarily quit their jobs remained unchanged at 750,000. Many of these individuals left their jobs in search of better opportunities, whether it be for higher wages, better working conditions, or career advancement. These trends reflect an ongoing shift in the job market, where workers feel confident enough to leave their current jobs in search of something better.
December 2024 Job Market Overview
In December 2024, the unemployment rate further decreased by 0.1 percentage point, dropping to 2.4%. This was the first improvement in three months, indicating a small but positive change in the country’s job market as the year drew to a close. The job availability ratio, however, remained unchanged at 1.25, showing that the demand for workers was stable but not increasing.
Sector-Specific Job Openings
Looking at specific industries, the job market saw growth in some areas. The information and communication sector, for example, saw a 9.3% increase in new job openings compared to December 2023. This growth was partly due to the increasing importance of technology and digital communication, which has been a key part of the economy’s recovery in the post-pandemic period.
Similarly, the hotel and restaurant sector saw a 5.2% rise in new job openings in December, which could be attributed to the recovery of tourism and travel industries as people began to travel more freely after the pandemic. These sectors, which were hard hit by the pandemic, have been showing signs of revival as the economy strengthens.
However, not all sectors experienced growth. The lifestyle and entertainment sector saw a significant drop in new job openings, with a decrease of 8.6% in December compared to the previous year. This could reflect a reduction in consumer spending or a shift in the way people spend their leisure time, as habits have changed due to the pandemic. Additionally, the manufacturing sector saw a 7.6% drop in new job openings, which might be a result of ongoing challenges in the global supply chain or changes in demand for certain products.
