Japanese unions urge employers to continue wage hikes next year and beyond
21/07/2023 11:01
TOKYO, July 21 (Reuters) - Japan's largest trade union
confederation 'Rengo' urged companies on Friday to raise wages
further to outpace inflation and help workers deal with rising
living costs.
The lobby group made the demand as its reviewed the results
of its annual spring wage talks that concluded earlier this
month, which saw major companies agree to average pay hikes of
3.58% this year, the highest in 30 years.
Prime Minister Fumio Kishida and the Bank of Japan (BOJ) are
hoping wage hikes can be sustained to generate more consumer
spending that will decisively lift the world's third-largest
economy from decades of stagnation.
In Japan, average annual wages have been virtually flat
since the bubble burst in the 1990s, OECD data showed, lagging
many other advanced economies. The outlook has been even less
positive for workers at smaller companies, which account for
almost 70% of the workforce.
It is imperative for real wages to continue to rise,
ensuring the economy will growth stably and consumers will shake
off the country's long deflationary mindset, Rengo said in its
document.
"There are some industries that did not see substantial wage
hikes and real wages remain under pressure from price
increases," said Rengo President Tomoko Yoshino. "It is vital to
improve the wage trend and we must keep up such efforts in our
2024 offensive."
Rengo will kick off debates in October on pay rises for the
coming year and set its expected wage demands by year end,
before it negotiates with management early next year so that
major firms can offer pay rises around the middle of March.
The survey of 5,272 unions affiliated with Rengo showed an
average pay hike of 3.58% this year, or 10,560 yen ($73.04) per
month, the biggest increase since 3.9% seen in 1993.
BOJ Governor Kazuo Ueda has repeatedly stressed the need to
keep monetary policy super-loose until wages increase enough to
keep price growth sustainably around its 2% target. But Japan
has seen inflation exceed that target for more than a year,
fuelling expectations the bank may soon start to raise its
ultra-low interest rates.
(Reporting by Tetsushi Kajimoto; Editing by Kim Coghill)
((tetsushi.kajimoto@thomsonreuters.com; +81-3-6441-1829;))