Japan tempers view on employment, profits as slowing global growth weighs

Japan's government trimmed its assessment of the labour market in November for the first time in five years and also cut its view on corporate profits as slowing global growth weighs on the manufacturers.

The government left unchanged its overall assessment that the world's third-largest economy is recovering at a moderate pace, though prolonged weakness centred mainly on exporters has remained. The more subdued view on the employment and profit outlook for manufacturers could become a source of concern for policymakers.

"As...production activities are falling, demand for new people is somewhat slowing," a government official told.

However, the November report kept a positive overall view on the employment situation, saying it was "improving" compared to "steadily improving" previously, the first downgrade of employment since November 2014.

The government also took down a notch its view on corporate profits, largely due to weakening third-quarter profits among manufacturers, compared to the same period in the previous year.

But the government said profits were still at a high level and non-manufacturers' profits stayed largely steady. Capital expenditure due to strong corporate profits would continue, the official said.