Real wages in Japan decline for 20th straight month

Decline comes amid calls for faster pace of pay hikes this year

Real wages in Japan decline for 20th straight month

Real wages in Japan went down for the 20th consecutive month in November amid calls to employers there to hike pay at a faster pace than in 2023.

Data from Japan's Ministry of Health, Labour, and Welfare revealed a three per cent decline in real wages from a year earlier.

Nominal wages went up to JPY288,711 in November, a 0.2% increase from a year earlier, according to government data.

This is the 23rd straight month of increase for total monthly cash earnings in Japan, as per ministry data, but this is a slower growth compared to the 1.5% increase in October.

By sector, the Electricity, Gas, Heat Supply, and Water saw the largest hike of 5.8%, going up to JPY471,971. Other sectors that saw increases include:

  • Finance and Insurance (4.9%)
  • Education, Learning Support (4.3%)
  • Scientific Research, Professional and Technical Services (3.9%)

The sectors that saw declines include:

  • Construction (-2.7)
  • Medical, Health Care, and Welfare (-1.7%)
  • Manufacturing (-0.9%)
  • Accommodations, Eating, and Drinking Services (-0.4%)

Call from the prime minister

The decline in real wages come as Prime Minister Fumio Kishida previously called on employers to hike pay at a faster pace than in 2023, The Mainichi reported.

"I strongly ask everyone in the business community to accelerate domestic investment and, above anything else, to achieve wage growth that will exceed this year's," Kishida told business leaders at an event last year.

Japan last year registered its biggest pay increase in decades following the conclusion of the shunto spring wage talks, with the country's largest union sealing a 5.28% salary hike.

Major firms in Japan, including Fast Retailing, Sumco, Disney, and Aeon, also unveiled major wage increases in the previous year.

This year, a survey from Kyodo News revealed that 43% of 113 companies are either considering or planning wage increases. Another 45% said they are undecided.

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