Japan's average unemployment rate in fiscal 2025 increased by 0.1 percentage point from the previous year to 2.6%, marking the first deterioration in five years, according to government data released by the Ministry of Internal Affairs and Communications [1]. This rise is attributed to more people who were not previously working entering the job market and being counted as unemployed as they began seeking jobs [1]. The number of unemployed individuals grew by 50,000 to 1.80 million, while the number of employed people rose by 360,000 to 68.29 million, the highest level since comparable data began in 1953 [1]. Notably, the number of employed women reached a record high of 31.28 million, up 360,000 from the previous fiscal year [1].
Among those not in work, 420,000 people lost their jobs, an increase of 10,000 from the prior year, and 760,000 left their jobs voluntarily, typically to seek better conditions [1]. The number of people newly seeking jobs increased by 30,000 to 500,000 [1]. In March alone, the unemployment rate rose to 2.7% from 2.6% in February, with the number of people with jobs edging down 0.2% to a seasonally adjusted 68.15 million [1]. Voluntary job leavers in March increased by 3.9% to 790,000, and those newly seeking jobs rose by 3.8% to 550,000 [1].
A ministry official stated that "employment conditions remain solid," highlighting the increase in people quitting jobs to pursue better working conditions and the persistent labor shortages in the market [1]. The official added that it has become easier for workers to seek positions offering improved employment terms [1].
The average job availability ratio in fiscal 2025 fell by 0.05 point to 1.20, indicating 120 jobs for every 100 job seekers, marking the third consecutive annual decline [1]. In March, the ratio edged down by 0.01 point to 1.18, the first drop in two months [1]. New job openings declined across seven industries, with information and communications experiencing a 15.8% plunge, wholesale and retail down 6.5%, and accommodation and restaurant services falling 6.4% year-on-year in March [1]. While no significant impact from the Middle East conflict has been observed on employment, some manufacturing sector representatives have expressed concerns about the future outlook [1].
CONCLUSION
Japan's labor market in fiscal 2025 saw a slight rise in unemployment as more individuals entered the workforce, but overall employment reached record highs, especially among women. Despite a modest decline in job availability and sector-specific slowdowns, officials maintain that employment conditions remain robust, with ongoing labor shortages and increased worker mobility. The outlook remains cautiously optimistic, though some sectors are wary of potential future challenges.