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Labor crunch risks derailing Japan's stumbling economic recovery

Businesses brace for higher labor costs on top of weak yen, inflation

People work in a Tokyo office in Nov. 2020. Japan may not have enough workers to sustain the recovery from the pandemic.   © Reuters

TOKYO -- Japan has more job vacancies than applicants, making it a great place to be a job hunter. But a chronic labor shortage, in a country with a shrinking working-age population, is weighing on the prospects for a recovery from the pandemic-induced slowdown.

Data released Friday showed there are 1.27 positions open for each job seeker in Japan, the highest figure in around two years. The ratio has crept up over the past seven months, indicating that hiring is increasing across industries. The hotel and restaurant sector and manufacturing, in particular, have added positions.

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