Japan’s jobs market is getting tighter

ooyoo| iStock 360 | Getty Images

For global markets Friday may be all about the closely-watched U.S. monthly jobs data, but the latest employment figures from the world's number three economy are not to be ignored.

Data released earlier Friday showed Japan's jobless rate at 3.6 percent in March, holding steady from February when it hit lows last seen in July 2007. Separate figures showed the jobs-to-applicants ratio rise to 1.07 from 1.05 in February, showing that the availability of jobs continues to improve.

Read More Japan household spending jumps, jobs market improves

The numbers are important, say economists, because they suggest Japan's labor market is reaching a point where it should boost wages, helping to underpin consumption at a time when shoppers have just been whacked with a rise in the sales tax.

"The unemployment rate is at cycle lows and at these levels is close to full employment, so we should start to see upward pressure on wages," said HSBC Japan Economist Izumi Devalier.

Friday's U.S. jobs data meanwhile is expected to show the unemployment rate at 6.7 percent in April, unchanged from March.

Japan's monetary easing won't work: Pavlik

Japan's sale tax rose to 8 percent from 5 percent in April, marking the first rise in 17 years. While a shopping spree ahead of the hike is expected to have lifted economic activity in the first quarter of the year, the economy is expected to take a hit in the months ahead as consumption slows.

That's where the jobs market comes in. Employment growth and wage increases would be timely as they would help take the sting out of the rise in the consumption tax, which some have feared could derail Japan's economic recovery.

"We can see that after the consumption tax hike there will be a cool down in consumption," said Long Hanhua Wang, Japan economist at RBS in Tokyo.

Read More China to overtake US economy, India trumps Japan

"There are signs that the extent of the cool down is not as great as expected and that means a general labor market improvement and wage increases should support consumption," he added.

Wage earners' total cash pay in Japan rose 0.7 percent in March on-year, data on Wednesday showed, rising for the first time in three months, according to Reuters.

Economists say that much of the rise was down to bonuses and overtime pay, with real wages down 1.3 percent on year in March.

They add that while Japan's jobs market is getting tighter it will take some time before this translates into higher wages.

Read More Hello job growth? Trend expected to return

Still, there are some other positive signs. Earlier this year Toyota Motor, one of Japan's largest manufacturers, said in would raise the average monthly base pay for union workers by 2,700 yen, or about $26, in the first wage rise since 2008.

HSBC's Devalier said she was also watching overall levels of employment. Japan's employment levels rose 0.8 percent on year in March from a 0.7 percent rise a month earlier.

"One thing we should note is that even if wages are sluggish, if more and more people are joining the workforce that is positive on an economy-wide level," she added.