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Japanese Unemployment Rate Edges Lower - 2002-04-26

Japan's unemployment rate edges lower and four companies set up a consortium to form the country's largest Internet service provider.

The Japanese government says the jobless rate for March has improved slightly to 5.2 percent. It hit an all time high of 5.5 percent last December.

State Minister for Economic and Fiscal Policy Heizo Takenaka says the improvement is good news, but he does not see this as a (significant) change in the trend. He warns that employment conditions remain severe, with jobless numbers rising.

The number of unemployed, more than 3.75 million people, rose, but the unemployment rate dropped because of adjustments for seasonal factors.

Japan is struggling to create jobs during its deepest recession since World War Two. As many companies restructure, economists predict that more people will lose jobs.

Leading Japanese technology companies NEC and Matsushita Electric are joining forces with telecommunications giants KDDI and Japan Telecom. Their consortium will offer broadband Internet access and other related services.

Together they will form the largest Internet service provider in Japan, with 10 million subscribers.

NEC Solutions Senior Vice President Kenji Yoshiyama says the four companies will jointly develop content for personal computers. He adds that the new operation needs more investment to provide a variety of services, so the alliance is open to new partners.

There is increasing rivalry in Japan's Internet business, few companies offering Internet services have made a profit.

One alliance partner, Japan Telecom, released restructuring plans this week, which many analysts call vague and disappointing. The company aims to increase cash flow and lower capital spending, but it did not reveal plans to sell some of its units, as has been expected.