>TOKYO, March 15 (Reuters) – Japan’s top companies offered their largest pay increases in a quarter century on Wednesday, as the outcome of annual labour talks showed Japan Inc heeding Prime Minister Fumio Kishida’s calls for higher wages to counter a surge in inflation.
>This year companies are expected to raise wages at “shunto” spring wage talks that wrap on Wednesday by 2.85%, according to a survey of 33 economists taken by Japan Economic Research Center (JERC).
>That’s far above last year’s 2.2% and the fastest gain since 1997, when Japan slid into 15 years of deflation.
>The Rengo umbrella labour group has called for a 5% pay increase. The wage talks involve both base and bonus pay.
>
>Given that consumer inflation, at 4.1%, outpaces wage hikes, pay rises of 3% or more need to continue in the coming years to sustain price stability at 2%, the central bank’s target, said Hisashi Yamada, senior economist at Japan Research Institute.
>Industrial conglomerate Hitachi Ltd, a cornerstone of corporate Japan, said it would increase overall pay by an average of 3.9%, compared to a 2.6% increase a year earlier.
>Kishida’s government will likely hold a joint three-party meeting with labour and management for the first time in eight years on Wednesday to ensure structural wage hikes.
>What’s unique about shunto in Japan is that every March, more than 300 major firms capitalised at 1 billion yen or more and with 1,000 or more workers, negotiate with their union following wages pace-setters such as Toyota Motor Corp.
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Excerpt from the linked content:^1
>TOKYO, March 15 (Reuters) – Japan’s top companies offered their largest pay increases in a quarter century on Wednesday, as the outcome of annual labour talks showed Japan Inc heeding Prime Minister Fumio Kishida’s calls for higher wages to counter a surge in inflation.
>This year companies are expected to raise wages at “shunto” spring wage talks that wrap on Wednesday by 2.85%, according to a survey of 33 economists taken by Japan Economic Research Center (JERC).
>That’s far above last year’s 2.2% and the fastest gain since 1997, when Japan slid into 15 years of deflation.
>The Rengo umbrella labour group has called for a 5% pay increase. The wage talks involve both base and bonus pay.
>
>Given that consumer inflation, at 4.1%, outpaces wage hikes, pay rises of 3% or more need to continue in the coming years to sustain price stability at 2%, the central bank’s target, said Hisashi Yamada, senior economist at Japan Research Institute.
>Industrial conglomerate Hitachi Ltd, a cornerstone of corporate Japan, said it would increase overall pay by an average of 3.9%, compared to a 2.6% increase a year earlier.
>Kishida’s government will likely hold a joint three-party meeting with labour and management for the first time in eight years on Wednesday to ensure structural wage hikes.
>What’s unique about shunto in Japan is that every March, more than 300 major firms capitalised at 1 billion yen or more and with 1,000 or more workers, negotiate with their union following wages pace-setters such as Toyota Motor Corp.
^1 Tetsushi Kajimoto for Reuters, 15 Mar. 2023, https://www.reuters.com/markets/asia/japans-big-firms-set-offer-biggest-pay-rises-decades-2023-03-14/