By Kantaro Komiya

TOKYO (Reuters). Japan’s unemployment rate dropped unexpectedly to 2.6% in March. This was the lowest level since April 2020. Official data from Tuesday however showed that furloughed workers remained high because of the pandemic.

The third largest economy in the world has struggled to recover from the COVID-19 pandemic.

However, the data did show some resistance in the labor market. According to Reuters, the seasonally adjusted unemployment rate was 2.7% lower than what was forecasted by economists in a poll. It was also less than February’s reading.

After adjusting for seasonality, March’s data revealed that the total number of employees increased by 180,000 versus a month before. However, it was lower by the number who were unemployed by 99,000 in March.

A government official said that the drop in unemployment rates indicates signs of recovery in the labor market during a briefing for media.

“But, the impact of pandemic appears lingering, and requires close attention,” said he. He was referring to furloughed workers who remained at 2.43million in March, mostly among the face-toface service sector.

According to labour ministry data, the jobs-to-applicants ratio rose 0.01 points from 1.21 in March according to a Reuters poll.