Japanese employers urged to offer wage hikes of at least 4%: reports

Employers asked to exceed last year's average wage increase

Japanese employers urged to offer wage hikes of at least 4%: reports

The Japan Business Federation is calling on employers to offer wage hikes of at least four per cent ahead of the upcoming spring wage negotiations next week.

The federation, the country's most powerful business lobby, asked employers to surpass the 3.99% average wage hikes offered in 2023, which was the highest in 31 years, Kyodo News reported.

The federation made the call on Tuesday during the release of its guidelines for this year's spring wage negotiations or shunto.

"To companies, we would like to call for active consideration and implementation of wage increases with a stronger passion and resolve than in 2023," the federation, or Keidanren, said in the guideline as quoted by Kyodo News.

The guidelines did not specifically state how much employers should raise wages this year, according to the report, but it noted that base pay increases are an effective option to fight against rising prices.

During the wage talks last year, Keidanren also urged its members to "respond positively" to requests of pay hikes.

Call for wage hikes

Prime Minister Fumio Kishida asked employers in December last year to hike pay at a faster pace than in 2023.

Last year, employers such as Fast Retailing, Sumco, Disney, and Aeon unveiled major wage increases. The country's largest union also sealed a 5.28% salary hike from last year's annual wage talks.

This year, a Kyodo News survey revealed that 43% of 113 employers are either consider or planning to hike their employees' wages.

Real wages in Japan declined by three per cent from a year earlier in 2023, according to the latest data from the Ministry of Health, Labour, and Welfare. It was also the 20th straight month that real wages declined in the country.

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