March 6. 2019 ank of japa Economic Activity, Prices, and monetary Policy in Japan Speech at a Meeting with Business Leaders in Yamanashi Yutaka harada Member of the policy board ( English translation based on the Japanese original)
Yutaka Harada Member of the Policy Board Economic Activity, Prices, and Monetary Policy in Japan Speech at a Meeting with Business Leaders in Yamanashi Bank of Japan M a r c h 6 , 2 0 1 9 (English translation based on the Japanese original)
Introduction Thank you for giving me this opportunity to exchange views with you and for having taken the time to be here despite your busy schedules. It is indeed a great honor to be here today Please allow me to express my gratitude for your great cooperation with the business operations of the Bank of Japan, particularly of the Kofu Branch The Bank introduced quantitative and qualitative monetary easing- or QQE for short--in April 2013 with the aim of achieving the inflation target of 2 percent, and since then has strengthened the QQE framework Today, I first would like to explain the achievements thus far of the Banks monetary easing neasures, excluding those regarding prices, and then describe recent developments in the economy and prices L. The Achievements of Monetary Easing Improvements in Employment The first thing that should be mentioned as an achievement of monetary policy is the improvement in employment. Chart I shows the number of regular and non-regular employees. As can be seen, at the start of QQe, it was primarily non-regular employment that increased. However, since around the beginning of 2015, regular employment also has expanded. Moreover, the share of non-regular employees(non-regular employees divided by all employees excluding executives), which had been rising, also has leveled off. I Regarding how monetary easing lifts productivity, see Yutaka Harada, "Economic Activity, Prices and Monetary Policy in Japan: Speech at a Meeting with Business Leaders in Ishikawa, Bank of Japan, July 2018
1 Introduction Thank you for giving me this opportunity to exchange views with you and for having taken the time to be here despite your busy schedules. It is indeed a great honor to be here today. Please allow me to express my gratitude for your great cooperation with the business operations of the Bank of Japan, particularly of the Kofu Branch. The Bank introduced quantitative and qualitative monetary easing -- or QQE for short -- in April 2013 with the aim of achieving the inflation target of 2 percent, and since then has strengthened the QQE framework. Today, I first would like to explain the achievements thus far of the Bank's monetary easing measures, excluding those regarding prices, and then describe recent developments in the economy and prices. I. The Achievements of Monetary Easing Improvements in Employment The first thing that should be mentioned as an achievement of monetary policy is the improvement in employment.1 Chart 1 shows the number of regular and non-regular employees. As can be seen, at the start of QQE, it was primarily non-regular employment that increased. However, since around the beginning of 2015, regular employment also has expanded. Moreover, the share of non-regular employees (non-regular employees divided by all employees excluding executives), which had been rising, also has leveled off. 1 Regarding how monetary easing lifts productivity, see Yutaka Harada, "Economic Activity, Prices, and Monetary Policy in Japan: Speech at a Meeting with Business Leaders in Ishikawa," Bank of Japan, July 2018
Chart 1 Employment Introduction of QQE Before QQE After QQE Regular employees +1.1% Non-regular employees +1.5%(annualized)+2.4% 10 实图8S甚8器8 Number of regular employees( both sexes) +Number of non-regular employees(both sexes) Rate of non-regular employees(both sexes, right scale) Note: Regular employees and non-regular employees exclude executives of companies and corporations. The figures for"Before QQE"and"After QQE"show the annualized growth rates of employees from 2008/Q1 to 2013/Q1 and those from 2013/Q1 to 2018/Q4 ource: Ministry of Internal Affairs and Communications, "Labour Force Survey Improvements in Employment of women and the elderly Chart 2 shows that the employment of both women and the elderly ( those aged 65 years and over)has been growing. Nevertheless, despite women's entry into the labor market, most women work part-time, and I am well aware of the criticism that there are few women in top positions in Japan. According to the World Economic Forum's Global Gender Gap Index(2018), which measures the degree of gender equality, Japan ranks only 1 loth among 149 countries. However, some progress is being made. As can be seen in Chart 2, the number of women in regular employment has been increasing. Moreover, the proportion of women who are non-regular employees, which had been rising, has remained flat since the start of QQE. This means that the number of women gaining experience at work and
2 Improvements in Employment of Women and the Elderly Chart 2 shows that the employment of both women and the elderly (those aged 65 years and over) has been growing. Nevertheless, despite women's entry into the labor market, most women work part-time, and I am well aware of the criticism that there are few women in top positions in Japan. According to the World Economic Forum's Global Gender Gap Index (2018), which measures the degree of gender equality, Japan ranks only 110th among 149 countries. However, some progress is being made. As can be seen in Chart 2, the number of women in regular employment has been increasing. Moreover, the proportion of women who are non-regular employees, which had been rising, has remained flat since the start of QQE. This means that the number of women gaining experience at work and 0 5 10 15 20 25 30 35 40 45 0 5 10 15 20 25 30 35 40 45 Feb. 1984 Feb. 86 Feb. 88 Feb. 90 Feb. 92 Feb. 94 Feb. 96 Feb. 98 Aug. 99 Aug. 2000 Aug. 01 02/Q2 02/Q4 03/Q2 03/Q4 04/Q2 04/Q4 05/Q2 05/Q4 06/Q2 06/Q4 07/Q2 07/Q4 08/Q2 08/Q4 09/Q2 09/Q4 10/Q2 10/Q4 11/Q2 11/Q4 12/Q2 12/Q4 13/Q2 13/Q4 14/Q2 14/Q4 15/Q2 15/Q4 16/Q2 16/Q4 17/Q2 17/Q4 18/Q2 18/Q4 Number of regular employees (both sexes) Number of non-regular employees (both sexes) Rate of non-regular employees (both sexes, right scale) mil. persons Before QQE After QQE Regular employees -0.6% (annualized) +1.1% Non-regular employees +1.5% (annualized) +2.4% Introduction of QQE % Note: Regular employees and non-regular employees exclude executives of companies and corporations. The figures for "Before QQE" and "After QQE" show the annualized growth rates of employees from 2008/Q1 to 2013/Q1 and those from 2013/Q1 to 2018/Q4, respectively. Source: Ministry of Internal Affairs and Communications, "Labour Force Survey." Chart 1 Employment
moving into managerial positions also should increase. In fact, the share of managerial d by women has been Chart 2 Employment of Women and the elderly mil. persons Introduction of QQE 10 Before QQE Non-regular employees(female)+1.2%(annualized+2.6% Regular employees(female) +0. 2%(annualized)I+2.0% After QQE regular employees(both sexes, aged 65 years and over)+5.7%(annualized+12.1% employees(both sexes, aged 65 years andover) +3.7%(amualized+6.9% 8等: 8黑器等等溪 -Number of regular employees(both sexes, aged 65 years and over) Number of non-regular employees( both sexes, aged 65 years and over) Number of regular employees(female) Number of non-regular employees(female) Rate of non-regular employees(female, right scale) Rate of non-regular employees(both sexes, aged 65 years and over, right scale Rate of non-regular employees(both sexes, aged 15-64 years, right scale) Note: Regular employees and non-regular employees exclude executives of companies and corporations. The figures for"Before QQE"and"After QQE"show the annualized growth rates of employees from 2008/Q1 to 2013/Q1 and those from 2013/Q1 to 2018/Q4, Source: Ministry of Internal Affairs and Communications, " Labour Force Survey. Moreover, Chart 2 also shows that employment of the elderly has been growing. However, in the case of the elderly, the share of non-regular employees has been rising. The reason likely that many are hired as temporary or part-time workers after reaching retirement age 2 For details, see Ministry of Health, Labour and Welfare, FY2017 Basic Survey of Gender equalit in Employment Management(available only in Japanese), July 2018
3 moving into managerial positions also should increase. In fact, the share of managerial positions occupied by women has been on a rising trend. 2 Moreover, Chart 2 also shows that employment of the elderly has been growing. However, in the case of the elderly, the share of non-regular employees has been rising. The reason is likely that many are hired as temporary or part-time workers after reaching retirement age. 2 For details, see Ministry of Health, Labour and Welfare, FY2017 Basic Survey of Gender Equality in Employment Management (available only in Japanese), July 2018. Chart 2 Employment of Women and the Elderly 0 10 20 30 40 50 60 70 80 0 2 4 6 8 10 12 14 16 Feb. 1984 Feb. 86 Feb. 88 Feb. 90 Feb. 92 Feb. 94 Feb. 96 Feb. 98 Aug. 99 Aug. 2000 Aug. 01 02/Q2 02/Q4 03/Q2 03/Q4 04/Q2 04/Q4 05/Q2 05/Q4 06/Q2 06/Q4 07/Q2 07/Q4 08/Q2 08/Q4 09/Q2 09/Q4 10/Q2 10/Q4 11/Q2 11/Q4 12/Q2 12/Q4 13/Q2 13/Q4 14/Q2 14/Q4 15/Q2 15/Q4 16/Q2 16/Q4 17/Q2 17/Q4 18/Q2 18/Q4 Number of regular employees (both sexes, aged 65 years and over) Number of non-regular employees (both sexes, aged 65 years and over) Number of regular employees (female) Number of non-regular employees (female) Rate of non-regular employees (female, right scale) Rate of non-regular employees (both sexes, aged 65 years and over, right scale) Rate of non-regular employees (both sexes, aged 15-64 years, right scale) mil. persons Introduction of QQE % Note: Regular employees and non-regular employees exclude executives of companies and corporations. The figures for "Before QQE" and "After QQE" show the annualized growth rates of employees from 2008/Q1 to 2013/Q1 and those from 2013/Q1 to 2018/Q4, respectively. Source: Ministry of Internal Affairs and Communications, "Labour Force Survey." Before QQE After QQE Non-regular employees(female) +1.2% (annualized) +2.6% Regular employees (female) +0.2% (annualized) +2.0% Before QQE After QQE Non-regular employees(both sexes, aged 65 years and over) +5.7% (annualized) +12.1% Regular employees (both sexes, aged 65 years and over) +3.7% (annualized) +6.9%
Because Japan 's population is aging, this means that it is unlikely that the share of non-regular employees in employment as a whole will decrease. However, looking at employees between 15 and 64 years of age, the share of non-regular employees has been declining since around 2014 While it is difficult for the elderly to obtain regular employment, the fact is that more and more are gaining the opportunity to work. In September 2017, the government launched the Council for Designing a 100-Year Life Society, "and in June 2018 it released the report B Jasic [ Design for the Human Resources Development Revolution, " calling for increased employment of the elderly At the same time, however, the proliferation of the notion of a 100-Year Life"may have made people aware of the longevity risk again, which may have led to the rise in the savings rate, or in other words, the decline in the consumption rate, which I will talk about later Decrease in suicides When unable to find a job in the face of a difficult employment situation, being under such stress causes one to question their worth to society. Indeed, studies show that suicides increase in tandem with a rise in the number of unemployed. Assuming that this is true, suicides should decrease if the unemployment rate were to decline. Chart 3, which shows the number of suicides and the unemployment rate, indicates that the two are linked: as the unemployment rate rises, the number of suicides increases, and vice versa. While i do not think that suicides are caused by economic problems alone, what is clear is that the number of suicides per year has fallen by 7,000 or more since 2012 as a result of the upturn in the economy and the decline in the unemployment rate 3 At the G-20 Symposium"For a Better Future: Demographic Changes and Macroeconomi Challenges" held in January 2019, seven out of 13 speakers stressed the importance of labor force participation by the elderly in overcoming demographic challenges posed by the aging I ee, for example, Yasuyuki Sawada, Michiko Ueda, and Tetsuya Matsubayashi, Economic Analysis of Suicide Prevention Towards Evidence-Based Policy-Making, Singapore: Springer, 2017
4 Because Japan's population is aging, this means that it is unlikely that the share of non-regular employees in employment as a whole will decrease. However, looking at employees between 15 and 64 years of age, the share of non-regular employees has been declining since around 2014. While it is difficult for the elderly to obtain regular employment, the fact is that more and more are gaining the opportunity to work. In September 2017, the government launched the "Council for Designing a 100-Year Life Society," and in June 2018 it released the report "[B]asic [D]esign for the Human Resources Development Revolution," calling for increased employment of the elderly.3 At the same time, however, the proliferation of the notion of a "100-Year Life" may have made people aware of the longevity risk again, which may have led to the rise in the savings rate, or in other words, the decline in the consumption rate, which I will talk about later. Decrease in Suicides When unable to find a job in the face of a difficult employment situation, being under such stress causes one to question their worth to society. Indeed, studies show that suicides increase in tandem with a rise in the number of unemployed.4 Assuming that this is true, suicides should decrease if the unemployment rate were to decline. Chart 3, which shows the number of suicides and the unemployment rate, indicates that the two are linked: as the unemployment rate rises, the number of suicides increases, and vice versa. While I do not think that suicides are caused by economic problems alone, what is clear is that the number of suicides per year has fallen by 7,000 or more since 2012 as a result of the upturn in the economy and the decline in the unemployment rate. 3 At the G-20 Symposium "For a Better Future: Demographic Changes and Macroeconomic Challenges" held in January 2019, seven out of 13 speakers stressed the importance of labor force participation by the elderly in overcoming demographic challenges posed by the aging population. 4 See, for example, Yasuyuki Sawada, Michiko Ueda, and Tetsuya Matsubayashi, Economic Analysis of Suicide Prevention Towards Evidence-Based Policy-Making, Singapore: Springer, 2017
Chart 3 Unemployment Rate and Suicides sons 0.000 35,000 30.000 25.000 65432 15000 10000 5.000 198082848688909294969800020406081012141618 Number of suicides -Unemployment rate(right scale) Sources: National Police Agency, " Suicide Statistics", Ministry of Internal Affairs and Communications, "Labour Force Survey Slight Increase in the birth rate I think that a small improvement in the birth rate also has been achieved. Chart 4 shows the unemployment rate, the marriage rate, and the birth rate for the population of 20-to 39-year-olds. It is a well-known fact that the marriage rate and the birth rate are correlated as is more or less evident from the chart
5 Slight Increase in the Birth Rate I think that a small improvement in the birth rate also has been achieved. Chart 4 shows the unemployment rate, the marriage rate, and the birth rate for the population of 20- to 39-year-olds. It is a well-known fact that the marriage rate and the birth rate are correlated, as is more or less evident from the chart. Chart 3 Unemployment Rate and Suicides 0 1 2 3 4 5 6 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 1980 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 Number of suicides Unemployment rate (right scale) % Sources: National Police Agency, "Suicide Statistics"; Ministry of Internal Affairs and Communications, "Labour Force Survey." persons
Chart 4 Rates of Unemployment, Marriage, and Birth 100 thous. persons(live births persons(birth rate); cases(ma 6 3 Tmmnnnnnnnnnnnnnnnnnnnnnnnnnnn 2 a Number of live births Birth rate(per 1,000 population aged 20 to 39) Marriage rate(per 1,000 population aged 20 to 39) Unemployment rate(aged 20 to 39, right scale) Note: For 1975 onward, the birth rate is calculated as the number of live births to mothers aged 20 to 39 divided by the population aged 20 to 39. For 1974 and earlier, the birth rate is calculated as the total number of live births divided by the population aged 20 to 39. The marriage rate is calculated as the total number of marriages divided by the population nged 20 to 39 ources:Ministry of Internal Affairs and Communications, "Labour Force Survey", Ministry of Health, Labour and Welfare "Vital Statistics Let us take a closer look at this. The birth rate per 1,000 population aged 20 to 39(hereafter birth rate), which previously had been on a declining trend, has been rising since 2005 along with the decline in the unemployment rate The bar graph in the chart illustrates this trend in terms of live births per population (hereafter live births ) Note how, when comparing two age groups with the same birth rate, the number of live births increases for the age group with a greater number of constituents Given that second-generation baby boomers(children of baby boomers born between 1947 and 1949)reached their average marriage age sometime between 1995 and 2000 or, if we take the rise in the average marriage age into account, sometime between 2000 and 2005 the number of live births subsequently would have increased had there been a reversal in the
6 Let us take a closer look at this. The birth rate per 1,000 population aged 20 to 39 (hereafter birth rate), which previously had been on a declining trend, has been rising since 2005 along with the decline in the unemployment rate. The bar graph in the chart illustrates this trend in terms of live births per population (hereafter live births). Note how, when comparing two age groups with the same birth rate, the number of live births increases for the age group with a greater number of constituents. Given that second-generation baby boomers (children of baby boomers born between 1947 and 1949) reached their average marriage age sometime between 1995 and 2000 or, if we take the rise in the average marriage age into account, sometime between 2000 and 2005, the number of live births subsequently would have increased had there been a reversal in the 1 2 3 4 5 6 7 0 10 20 30 40 50 60 1968 71 74 77 80 83 86 89 92 95 98 01 04 07 10 13 16 Number of live births Birth rate (per 1,000 population aged 20 to 39) Marriage rate (per 1,000 population aged 20 to 39) Unemployment rate (aged 20 to 39, right scale) 100 thous. persons (live births); persons (birth rate); cases (marriage rate) % Note: For 1975 onward, the birth rate is calculated as the number of live births to mothers aged 20 to 39 divided by the population aged 20 to 39. For 1974 and earlier, the birth rate is calculated as the total number of live births divided by the population aged 20 to 39. The marriage rate is calculated as the total number of marriages divided by the population aged 20 to 39. Sources: Ministry of Internal Affairs and Communications, "Labour Force Survey"; Ministry of Health, Labour and Welfare, "Vital Statistics." Chart 4 Rates of Unemployment, Marriage, and Birth
birth rate around this time There turned out to be no such increase however. The reason is that, during the approximate period from 1995 to 2005 and in the few years after the outbreak of the global financial crisis in 2008, young people of this generation were not able to find stable employment due to the so-called employment ice age, which led them to think twice about marriage and having children. ,0 Put differently, had QQe been introduced at an earlier stage, second-generation baby boomers would not have had to cope with the repercussions of the employment ice age, likely resulting in an increase in th number of live births from around 1995 Improvement in Government Finances An improvement in employment means that incomes increase. Firms hire people because their profits are rising. When employment grows, both profits and wages increase. When there is an increase in profits and wages--that is, the income of the country as a whole the government's tax revenue also rises. Chart 5 shows the general government fiscal balance(relative to GDP)and government debt(also relative to GDP). While Japans fiscal situation is severe, its deficit in fiscal 2017 shrank to 2.7 percent of GDP. Compared with a deficit of 8.3 percent in fiscal 2012, this is an improvement of about 5.5 percentage point The reason is that the economy has been doing well and the governments tax revenue has been increasing. The increase in tax revenue due to the consumption tax hike from 5 to 8 percent is said to amount to about 8 trillion yen(1.5 percent of GDP). while the remaining improvement of 4.0 percentage points is partly attributable to the effects of a positive turnaround in overseas economies, it owes in large part to the improvement in the economy 5 For details on the employment ice age, see Genda Yuji et al, Shiishoku hyogaki sedai no keizai shakai e no eikyo to taisaku ni kansuru kenkyii iinkai hokokusho, Research Institute for Advancement of Living Standards, November 2016 6 In his recent book, former Bank of Japan Governor Shirakawa argues that the immediate respo of many major Japanese firms to the large demand shock brought about by the bursting of the bubble and the outbreak of the global financial crisis in 2008 was to reduce graduate recruitment and increase non-regular employment. During this so-called employment ice age, the young bore the brunt of the employment adjustment. University graduates entering the labor market during this time the so-called second-generation baby boomers- found it difficult to accumulate sufficient skill as young workers, leading to lower income levels, which in turn has had a lasting social impact including an increase in the rate of those who are unmarried and the consequent decrease in the number of births(available only in Japanese). Shirakawa Masaaki, Chio ginko (Tokyo: Toyo Keizai, 2018),p.112
7 birth rate around this time. There turned out to be no such increase, however. The reason is that, during the approximate period from 1995 to 2005 and in the few years after the outbreak of the global financial crisis in 2008, young people of this generation were not able to find stable employment due to the so-called employment ice age, which led them to think twice about marriage and having children. 5 , 6 Put differently, had QQE been introduced at an earlier stage, second-generation baby boomers would not have had to cope with the repercussions of the employment ice age, likely resulting in an increase in the number of live births from around 1995. Improvement in Government Finances An improvement in employment means that incomes increase. Firms hire people because their profits are rising. When employment grows, both profits and wages increase. When there is an increase in profits and wages -- that is, the income of the country as a whole -- the government's tax revenue also rises. Chart 5 shows the general government fiscal balance (relative to GDP) and government debt (also relative to GDP). While Japan's fiscal situation is severe, its deficit in fiscal 2017 shrank to 2.7 percent of GDP. Compared with a deficit of 8.3 percent in fiscal 2012, this is an improvement of about 5.5 percentage points. The reason is that the economy has been doing well and the government's tax revenue has been increasing. The increase in tax revenue due to the consumption tax hike from 5 to 8 percent is said to amount to about 8 trillion yen (1.5 percent of GDP). While the remaining improvement of 4.0 percentage points is partly attributable to the effects of a positive turnaround in overseas economies, it owes in large part to the improvement in the economy 5 For details on the employment ice age, see Genda Yuji et. al, Shūshoku hyōgaki sedai no keizai shakai e no eikyō to taisaku ni kansuru kenkyū iinkai hōkokusho, Research Institute for Advancement of Living Standards, November 2016. 6 In his recent book, former Bank of Japan Governor Shirakawa argues that the immediate response of many major Japanese firms to the large demand shock brought about by the bursting of the bubble and the outbreak of the global financial crisis in 2008 was to reduce graduate recruitment and increase non-regular employment. During this so-called employment ice age, the young bore the brunt of the employment adjustment. University graduates entering the labor market during this time -- the so-called second-generation baby boomers -- found it difficult to accumulate sufficient skills as young workers, leading to lower income levels, which in turn has had a lasting social impact including an increase in the rate of those who are unmarried and the consequent decrease in the number of births (available only in Japanese). Shirakawa Masaaki, Chūō Ginkō (Tokyo: Toyo Keizai, 2018), p. 112
as a result of QQE. Moreover, the ratio of government debt to gDp also has declined slightly from its peak of 239 percent in fiscal 2015 Chart 5 Fiscal Balance and Debt of general Government relative to Nominal GDP 200 100 0 FY19949698000204060810121416 Fiscal balance -Government debt outstanding(right scale) Source: Cabinet Office, "System of National Accounts. Decline in Personal Income Inequality Furthermore, income inequality has declined. Results of statistics show that income inequality in terms of equivalized disposable income has declined. 7, Meanwhile, Chart 6 7 See Statistics Bureau, Ministry of Internal Affairs and Communications, "Analytical [Results of] Income Distribution, "2014 National Survey of Family Income and Expenditure(available only in Japanese), October 2016 8 Equivalized disposable income is obtained by adjusting the quotient of household disposable income and the square root of the number of household members. In its international comparisons the Organisation for Economic Co-operation and Development(OECD) uses the Gini coefficient (see footnote 11)and the relative poverty rate for each country calculated on the basis of equivalized disposable
8 as a result of QQE. Moreover, the ratio of government debt to GDP also has declined slightly from its peak of 239 percent in fiscal 2015. Decline in Personal Income Inequality Furthermore, income inequality has declined. Results of statistics show that income inequality in terms of equivalized disposable income has declined.7,8 Meanwhile, Chart 6 7 See Statistics Bureau, Ministry of Internal Affairs and Communications, "Analytical [Results of] Income Distribution," 2014 National Survey of Family Income and Expenditure (available only in Japanese), October 2016. 8 Equivalized disposable income is obtained by adjusting the quotient of household disposable income and the square root of the number of household members. In its international comparisons, the Organisation for Economic Co-operation and Development (OECD) uses the Gini coefficient (see footnote 11) and the relative poverty rate for each country calculated on the basis of equivalized disposable income. 0 50 100 150 200 250 300 -12 -10 -8 -6 -4 -2 0 1994 96 98 00 02 04 06 08 10 12 14 16 Fiscal balance Government debt outstanding (right scale) % % FY Source: Cabinet Office, "System of National Accounts." Chart 5 Fiscal Balance and Debt of General Government Relative to Nominal GDP
shows the trend in the relative poverty rate. As the chart shows, the relative poverty rate has declined, regardless of whether we look at the overall rate, the child poverty rate, or the poverty rate of single-parent households. Since most single-parent households are single-mother households, the chart indicates that the poverty rate of single mothers has declined from 62.0 percent in 2009 to 47.7 percent in 2014. While it is shocking that the poverty rate for single mothers is close to 50 percent, I view the rates decline to this extent as a substantial achievement 10 Chart 6 Relative Poverty rate 13 12 000 7 2009 -Overall Sources: Ministry of Internal Affairs and Communications, 2014 National Survey of famil 9 The relative poverty rate of a country is the proportion of its household members whose equivalized disposable income falls below the poverty line (one-half the median equivalized disposable income). Inequality has fallen from 2009 to 2014 in terms of the Gini coefficient fo equivalized disposable income. For details, see 2014 National Survey of Family Income and Expenditure(available only in Japanese) 10 Similarly, the relative poverty rate, the child poverty rate, and the poverty rate of single working-age households with at least one child have all declined from 2012 to 2015. See Ministry of Health, Labour and Welfare, Summary Report of Comprehensive Survey of Living Conditions 2016, June 2017
9 shows the trend in the relative poverty rate.9 As the chart shows, the relative poverty rate has declined, regardless of whether we look at the overall rate, the child poverty rate, or the poverty rate of single-parent households. Since most single-parent households are single-mother households, the chart indicates that the poverty rate of single mothers has declined from 62.0 percent in 2009 to 47.7 percent in 2014. While it is shocking that the poverty rate for single mothers is close to 50 percent, I view the rate's decline to this extent as a substantial achievement.10 9 The relative poverty rate of a country is the proportion of its household members whose equivalized disposable income falls below the poverty line (one-half the median equivalized disposable income). Inequality has fallen from 2009 to 2014 in terms of the Gini coefficient for equivalized disposable income. For details, see 2014 National Survey of Family Income and Expenditure (available only in Japanese). 10 Similarly, the relative poverty rate, the child poverty rate, and the poverty rate of single working-age households with at least one child have all declined from 2012 to 2015. See Ministry of Health, Labour and Welfare, Summary Report of Comprehensive Survey of Living Conditions 2016, June 2017. Chart 6 Relative Poverty Rate 10 20 30 40 50 60 70 7 8 9 10 11 12 13 1999 2004 2009 2014 Overall Children Single-parent households % % Sources: Ministry of Internal Affairs and Communications, "2014 National Survey of Family Income and Expenditure
