Goldman Sees Virus Hitting Japan Jobs More Than Financial Crisis
Goldman Sees Virus Hitting Japan Jobs More Than Financial Crisis
(Bloomberg) -- The coronavirus pandemic will hit Japan’s job market even harder than the global finance crisis, according to Goldman Sachs Group Inc.
The jobless rate could rise by 1.9 percentage points to 4.2% this quarter, analysts led by Naohiko Baba said in a note to clients Wednesday. Back during the financial crisis, the rate rose 1.4 percentage points to 5.4%, they wrote.
As bad as the projection for Japan may be, the country is still likely to suffer far fewer job losses than elsewhere because a tradition of lifetime employment and a preference for pay cuts over layoffs among companies and workers. Acute labor shortages in the aging nation should also help to keep a lid on unemployment, the analysts wrote.
IMF Sees Japan’s Economy Shrinking Least Among G-7 Peers in 2020
Still, young workers face higher risk of unemployment because so many of them have been hired as part-timers in recent years and don’t have the protections against dismissal that Japan’s full-time workers enjoy. The risk is particularly pronounced for people working in restaurants, department stores, entertainment and lodging, which rely on non-regular workers, the analysts said.
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