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Data shows negative aspects despite PM's claims of Abenomics' success

Ruling Liberal Democratic Party leader and Prime Minister Shinzo Abe delivers a campaign speech in the city of Fukushima on the morning of Oct. 10, 2017. (Mainichi)

Various data has shed light on some negative aspects of Japan's economy that differ from the success of "Abenomics" that Prime Minister Shinzo Abe claims, although share prices and employment indexes have improved over the past five years.

"We raised the ratio of job offers to job seekers to 1 for the first time in Japan," Prime Minister Abe proudly said in a speech he delivered in Kumagaya, Saitama Prefecture, on Oct. 18 during his campaign for the Oct. 22 House of Representatives election.

He then said that his administration has sped up Abenomics and emphasized that Japan's GDP, which shows the country's economic scale, has hit a record high.

The ruling Liberal Democratic Party (LDP) states in its election campaign pledge that the number of those in employment has increased by 1.85 million and that the number of young people who have received job offers has hit an all-time high.

Since Abe returned to power in December 2012, the ratio of full-time job offers to job seekers has continued to rise. In June, the ratio reached 1.01, surpassing 1 for the first time since the government began compiling data in November 2004. Since the ratio was 0.25 in the latter half of 2009 following the collapse of Lehman Brothers the previous year, the latest figure highlights a remarkable improvement in the employment situation.

However, the country's labor force population in 2016 -- the combined number of those in employment and those out of work aged 15 and over -- remains at the same level as that in 2008, but the number of regular employees decreased by 430,000.

The number of employees, excluding board members of companies and other organizations, grew by 2.3 million over a four-year period up to 2016, but roughly 90 percent of them, or 2.07 million, were non-regular employees.

Toshihiro Nagahama, chief economist at the Dai-ichi Life Research Inc., pointed out that job offers increased mainly in the manufacturing and construction industries while the number of job seekers decreased due to expanded work opportunities.

"Even though the ratio (of job offers to job seekers) surpassed 1, there are many cases where those looking for work don't meet conditions such as age restrictions or can't find the types of jobs they desire. While the employment situation has improved, not everybody can find permanent jobs," Nagahama said.

In 2016 when the national average ratio of full-time job offers to job seekers stood at 0.86, the ratio was the highest in Tokyo at 1.23 and the lowest in Okinawa at 0.38. Figures in 27 of the nation's 47 prefectures were below the national average.

By type of jobs, the ratio in the construction and mining sectors, which are short of manpower, stood at 3.38, but the figure for clerical work, which places a less physical burden on workers, was only 0.34.

The LDP's campaign pledge stresses that Japan's nominal GDP grew by 50 trillion yen to reach a record 543 trillion yen.

In a campaign speech, Abe told the public that the achievement was due to the implementation of Abenomics.

However, Shigeyuki Hattori, professor of economic policy at Doshisha University, pointed out that the prime minister evaded touching on negative aspects of the economy.

The rate of increase in real-term GDP -- which is calculated by deducting the effects of government-induced inflation from nominal GDP -- is below the figure before the collapse of Lehman Brothers.

"Japan's exports didn't grow despite the weaker yen. The structure of Japan's economy is similar to that of the stagnant U.S. economy in the 1980s," Hattori said.

According to the Cabinet Office, Japan's nominal GDP in 2015 was $4.4 trillion, accounting for 5.9 percent of the world economy, down 2.3 points from 2012. This is attributable to the devaluation of the yen triggered by the Bank of Japan's credit easing policy. However, there are no prospects that Japan can overcome its prolonged deflation in the foreseeable future, and the influence of Japan's economy has declined.

Toshiaki Tachibanaki, visiting professor of labor economics at Kyoto Women's University, urged voters to examine data before deciding which politicians and parties they will vote for.

"Wages haven't increased and the income gap hasn't been eliminated. Voters should thoroughly check data provided by the administration when making election judgments," he said.

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