Costco Japan wages provide pathway to firing up nation's low pay, economy

It's been a huge thing down here. Costco is offering 1,500 an hour here and thousands of people applied!

Good for Costco and IKEA! Paying people a living wage is exactly what Japan needs! It’s going to be a slow process, but eventually it’ll work too benefit Japan’s economy and quality of life!

Japan lags far behind other big economies with an index for its real average annual wages showing almost no growth between 1995 and 2021, according to IMF data. That compares with growth rates of 50% in the U.S. and nearly 30% in France during the same period.

Why must it be always gaiatsu (外圧) leading the way when it comes to improving the living standards of working Japanese?

"The big chains may have the strength to raise wages, but small and medium-sized businesses are still in a difficult position," said Hisanori Amada, an economist at the Gunma Labor Bureau. "Some can't even afford to offer jobs at the moment."

Because you have entrenched political and commercial interests trotting out the same excuses as they haord cash.

https://asia.nikkei.com/Opinion/Japanese-companies-must-stop-gloating-about-cash-hoarding

The simple fact is it is a worldwide phenomenon that while productivity has improved a larger and larger share of gains goes to capital instead of labor.

https://www.epi.org/productivity-pay-gap/

And while this produces agitation among labor abroad the Japanese labor force is particularly compliant and accepts the excuses given out by the Japan Inc./LDP combine.

The only way around this is to higher fewer people who work at higher efficiency. You can't just pay people standing around doing nothing more.

Well done Costco and Ikea. C'mon Japanese companies...learn to be generous!

The big chains may have the strength to raise wages, but small and medium-sized businesses are still in a difficult position," said Hisanori Amada, an economist at the Gunma Labor Bureau. "Some can't even afford to offer jobs at the moment."

Don't blame Costco, and take a look in the mirror. You have had at least a generation to adapt and yet you stood still and watched everything around you change, all while sucking through your teeth hoping and praying that "Abenomics" was going to be your savior!

Costco's starting hourly wage of 1,500 yen..

¥1,500 is considered a good wage?

That's £7.50 or less than two beers.

Thank God for exceedingly generous trust funds.

Good on Costco, not just for treating workers with respect, but also for bringing lower prices to Japanese consumers. A neighborhood in my area of Kobe has a retail shop selling products from Costco at prices 20-30% higher than an actual Costco's, but still lower than Japanese chain supermarkets nearby. For us an advantage of this store is that we can walk to it, or take a train, and buy a single item, for example one container of an something, instead of a carton. Japan Inc. remains stuck in the same old retail models, where the primary beneficiaries are the already wealthy at the top, most with seemingly little understanding of the effects low wages and high prices on commodities have on many consumers.

Now I would be even happier to see Whole Foods and Trader Joes come to Japan, or for a Japanese company to create similar versions of them.

Any of you who happen to live close enough to Costco should apply there if you need a part or full time job.

I have friends who've been working there since the late 1980s still working at their stores.

The benefits are decent and the pay is good here for Japan.

It depresses me when I see companies like Toyota and JAL make 100s of millions in profits but only give their workers miniscule pay raises, even if they are the biggest in the last 30 years.

Costco is to the USA as 7-11 is to Japan. Basically both companies put massive amounts of effort into ensuring that every item in their store is of the best quality for the price. The compeition in the USA to get a product into a Costco store is massive. As is the same at Japan's 7-11 stores. I love shopping at Costco and always walk out spending more than intended. They're opening a new one next week right at the Minami Alps IC in Yamanashi, I'll have to check it out on my way to our summer house in the high elevations. Anything to beat the summer heat in Tokyo.

1,500 per hour.

Costco shift is 8 hours. So, Lets do some quick math.

That is a monthly salary of 240.000 yen per month. I know you can work overtime in Costco.

Single men and woman get taxed to death in Japan you might take home 180.000. Then your heath insurance.

Okay now were at what 150.000. Living tax yearly. Yeah I had enough of that after 25 years there. This is the issue with Japan. If you can not speak read and write N1 level Japanese. The choices are pretty lame.

Teach English 250.000 yen and taxed to death.

Work in Factory and kill yourself for maybe 310.000 with over time. Again taxed to death.

Work at Costco, where that could be fun maybe culturally. They all get to eat together.

They seem to be happy when I walk by the room where they eat to use the bathroom. Always laughing, joking.

Japanese nationals get paid huge sums of money. Salary men. With huge bonuses. Twice or even three times a year.

Work at convivence store forgot that one.

Japan just not set up for fair working wages. If you want to make money in Japan. Learn Japanese. Really learn it like a Japanese. Then go back to Japanese college and ger a masters or PHD in something. Or mayy a rich spouse. Good luck with that.

Ok,now let's see these foreign companies shaming our Japanese companies into paying a decent living wage, especially down in the Ryukyus Islands,where it's an incomers and incomers situation.

Inbreds have the dilapidated houses,no chance of sale cos of greediness.

Incomers snap up undeveloped land fora song,develop unsustainable resort projects for future profit.

""Japan lags far behind other big economies with an index for its real average annual wages showing almost no growth between 1995 and 2021, according to IMF data. That compares with growth rates of 50% in the U.S. and nearly 30% in France during the same period.""

It's called GREED, you can't even STRIKE in Japan.

If and when Japan workers start STRIKING that's when their GREEDY employers will start raising wages.

That is a monthly salary of 240.000 yen per month.

Single men and woman get taxed to death in Japan you might take home 180.000. Then your heath insurance.

The income tax is 5% on the first 1,950,000 you make, then 10% of what you make between 1,950,000 and 3,300,000.

240,000 a month comes to 2,880,000 a year, which comes to 190,500 a year, which is 15,875 a month, or just under 7% of their monthly income.

Of course, there are local taxes, but you're taxing them at 25% (60,000)!

No surprises here, foreign elements again showing Japan how backwards and behind they are with the times. The sooner they wake up and improve and adapt, the better things will be here for everyone.

Costco stays loyal to their employees as well and offer an pathway to higher level positions. I have 2 relatives working for them in the U.S. making 6 figure salaries.

My wife worked at a local supermarket, getting 900 yen per hour. I thought that was slavery, as she is a very hard worker, so I asked her to ask for a raise.

The boss agreed to increase her hourly wage by 50yen.

Japan needs an actual Walmart instead of just Walmart’s partial ownership of the Seiyu supermarkets. That might actually stir wage growth if they price everyone else out of competition like in the States.

With Japan's demographics, I just can't see any hope for sustainable wage increases.

Japan needs an actual Walmart instead of just Walmart’s partial ownership of the Seiyu supermarkets. That might actually stir wage growth if they price everyone else out of competition like in the States.

I agree

They are building a new Costco near my office in Fukuoka, should open in November, my kid applied, hope she gets the job. I worked for the company for 2 years when I was 19, the most easiest job, but I worked in a different department that required a license so the pay was even back in the day very good, no complaints, no regrets.

Costco received more than 2,000 applications for about 300 spots for its Meiwa store which opened in April 2023 about an hour north of Tokyo.

Hats off to Costco. Proof that there is no "Labor shortage" in Japan that requires importing guest workers.

Offer a reasonable salary, and the applicants will run to your door.

They also raised all of the costs. That place is much more expensive now than it used to be.

It's called GREED, you can't even STRIKE in Japan.

If and when Japan workers start STRIKING that's when their GREEDY employers will start raising wages.

Is it greed? Or is it decades-long hangover from massive debt and overspending? If there was greed, it was the greed of the Bubble generation. That’s not what is driving economic decisions now. Japan hasn’t raised wages in decades because the money has run out. Striking and fomenting social unrest will not change this.

Until the last couple years, Japan hadn’t experienced inflation. Now that inflation is big, low wages are a problem.

Many places that pay 900-yen hourly wages are mom-and-pop shops. They’re not getting rich. Most of them are struggling to keep alive. Even many convenience stores are individually owned franchises. They’re not pulling in billions in profits.

Places like Costco are a double-edged sword for communities. They pay higher-than-average wages for entry-level or retail staff. They operate on high volume, which can put pressure on a lot of local businesses. It’s O.K. for the 300 people who get jobs at Costco. But what about the supermarkets, gas stations, and home centers nearby? They sell less. More than a few ultimately end up closing.

Until Japan reverses its demographic slide and also clears its huge public and corporate debts, this is the way of things.

They also raised all of the costs. That place is much more expensive now than it used to be.

Most items are imported. The yen at 160 to the dollar will do that.

Combine the horribly weak yen with the inflation in the U.S. that also sees prices for goods and labor up 30-40 percent in the last three years, and I’m amazed that Costco hasn’t raised prices more.

I have noticed that they’ve dropped some of their mid-range deals—not the Kirkland Signature discount stuff or the high-end premium stuff, but the branded stuff in the middle. Several items that they had carried for years that I always bought are gone now. I assume that with the weak yen and inflation, Costco just can’t reach its price point anymore.

Western companies like Costco or Ikea treat their workers in a more considerate way unlike the miserable slave payment that Japanese companies are giving to their employees.

Always behind,always too little and always too late,it became a recurrent theme in the last decades for this country.

Japan lags far behind other big economies with an index for its real average annual wages showing almost no growth between 1995 and 2021, according to IMF data

Yep and a Big Mac set in Canada is around $13 to 15 CND (¥1500~¥1755 in Australia $ 14 Aud (¥1500 ) and in The USA $10 USD (¥1600) and in Japan ¥800.

MacDonald is a good overall way to compare.

With perhaps the exception of the USA, try eating out in the rest like Canada, UK, EU Australia even in cheap places is an expensive thing to do!

So we raise wages, and the companies raise prices , so we raise wages again and cost go up so the businesses raise wages and repeat!

Just got back from Canada!

A simple meal for 2 at the cheapest price was a minimum $30 CND plus 18% to 20% tip. And that would be a good low low price.

A bottle of water $2.50 to $3..

Yeah Japan's wages are low but are you read for a ¥350 bottle of water instead of ¥108?

Will your wages go up faster than the prices?

The West isn't always the best example!

Look at buying a house, in Japan we still can, interest rates are good, prices are still reasonable.

In north America and Europe 4% 5% rates and a box in any major city will cost nearly a million dollars!

The original Costco was set up like a worker's coop so many of the original staff become millionaires. It has since restructured or been sold on, I can't quite remember, so this won't happen again, but it's good that they still pay considerably more than other retailers in Japan.

We've been going to Costco for nearly twenty years. In that time, some products have literally doubled in price. I don't know anyone whose wages have doubled.

William77

Today 07:41 pm JST

Western companies like Costco or Ikea treat their workers in a more considerate way unlike the miserable slave payment that Japanese companies are giving to their employees.

> Always behind,always too little and always too late,it became a recurrent theme in the last decades for this country

Sure western companies are so generous!

What a load!

Fired 2 year shy of retirement, a very common nice practice in the West especially Canada and the USA,

Layoff entire sections including soon to retire and outsource the work to a cheaper country!

I think some people either have a problem with Japan for personal reasons or haven't worked in the west in years

so costco have no "labour shortages" and it very simple,just be less greedy and pay normal money to its workers...

Fired 2 year shy of retirement, a very common nice practice in the West especially Canada and the USA, 

Layoff entire sections including soon to retire and outsource the work to a cheaper country!

I think some people either have a problem with Japan for personal reasons or haven't worked in the west in years

Depends on the company, it’s an exception, not the rule.

Prices are going up in Japan on food and other items, however, for the most part wages are not.

390 yen for a restaurant to charge for a bowl of anything is not sustainable anymore because of rising prices and they need to raise that to 500 yen and that is still a good deal.

I go to Costco maybe once every 2 months at the most!

They used to be good but today a lot of Japanese products I can get closer to home at the same price and I don't have to buy 2,4,6 in a pack!

I get gasoline cheap, buy a block of beef, toilet paper because I like the larger rolls, and maybe some fruit and frozen vegetables!

Nothing else is a bargain or special and you need to buy a large amount.

Chicken and pork are cheaper at Giyomu or hanamasa vegetables are cheaper at the local vegetable store, even the workshop Scott blue paper towels are now available at the Pro construction materials Centre at the same price or lower and I don't have to buy 12 in a pack.

When Costco had more imports and variety it was a regular things for us but now nearly 2/3 of the stuff they sell that we need is available at other discount stores far closer to home and we don't need to buy multiples!

Didn't JT run this story about a month ago?

Salaries up 1/3 is very good. However, it feels like prices have gone up about that much over the last 3-5 years.

starting pay at costco in the u.s. varies by state. some make up to $30 per hour a average, bottom is about $15 per hour.

but, and this is a big but, they have a 401k and raises come quickly. the overall average is $40,000 per year for the simple jobs.

for people who start out young and stick with costco, the rewards are aplenty.

a warehouse manager in the u.s. makes $500,000 +, depending on location. running a costco is a half million dollar per year job.

In response to why foreign companies do this and not Japanese. Many foreign countries see value in individual ability, might not mean much at Costco, but overall Japanese companies just see a job as a position to fill, as long as the person has the credentials they should be able to do the exact same job as the person before them, that's how most companies here see it. In other countries you can have the same position but one person can make more than double the salary, because they know they can't easily replace the skills of that person.

We encountered this problem when we tried to hire skilled/famous programmers & artists from abroad, after being told we needed foreign expertise and were asked to look around. Of course the asking salary will be more than 4 times the salary of a Japanese in the same position. Management insisted that we should send them an offer off 3 times less than they are currently making. Most Japanese companies don't pay for skills, they pay for the amount of years you are at a company and how old you are and just expect skilled people to fall in line, that's why they are failing on the global market.

¥1300 a hour for the first three months while learning and then ¥1050 after three months. Doesn’t sound like a good way to keep staff. Costco offers a higher wage to try and keep staff, this place will slash the wage by over a quarter once you can do the job. Clever.

Walmart pays 2800 yen/hour in the US and most Americans think that that is a low wage.

Costco has been operating for 25 years in Japan and has always offered good pay and more importantly always treated employees very well and in those 25 years that has not moved the needle much as far as wages + benefits + respect goes at Japanese retailers.

Shame J companies can't offer more like Costco.

Smh

As the weaker and weaker yen drives the prices of the many imported goods at Costco higher and higher, many customers will be cutting back or their spending. There's a tipping point where costs will exceed value. It may be a boon at the moment for the relatively few Costco workers, but the long-term effects will be detrimental to the surrounding communities and businesses. To raise their wages, they will have to raise their prices proportionately. As real wages lag price inflation, this squeeze will force people to reduce discretionary spending which will negatively impact the small businesses disproportionately.

To see evidence of this, one simply has to look at the trends in California where even major fast-food /restaurant chains are closing stores or automating as much as possible. The most immediately impacted are the former minimum wage workers who suddenly find themselves out of work.

Christopher, is the shortest Costco shift 8 hours?

Are there not people there who work short shifts at peak times?

Most of the goods I buy are not cheaper at Costco. OK store and Gyomu are much better. Don't have to buy in bulk and no need to pay a membership to enter. I do miss the muffins.

"Noodle chain Yamada-udon, for its part, said it has Costco to thank for the influx of shoppers into town, contributing to a 40-50% jump in its revenues."

Leave it to foreign know-how and practice to not only show how Japan needs to boost wages, but to actually also buoy-up the surrounding economies! Meanwhile, while Yama-udon said they thought it would be impossible to raise wages even beyond 10-yen but did so and are doing well, the rest of Japan sticks to the model of doing next to nothing and patting itself on the back and watching as the economy tanks.

LOL, Costco membership in Japan is $30/year and mine is $60/year + tax.

The only way around this is to higher fewer people who work at higher efficiency. You can't just pay people standing around doing nothing more.

I don't know how it is in Japan but Costco employees here seem to be harder working and more competent than their counterparts at Wally World.

Walmart pays 2800 yen/hour in the US and most Americans think that that is a low wage.

because it is. that’s $2,344 per month after taxes.

you can’t rent a dumpy apartment for less than $1,700/mo.

health insurance is about $600+ per month.

leaves nothing for a car and food and utilities.

Yamada-udon decided to renovate the store, in Meiwa, Gunma prefecture, offering 1,300 yen an hour for the first three months. That was shy of Costco's starting hourly wage of 1,500 yen but enough to entice job-seekers in the notoriously tight labour market. After three months, wages would be at 1,050 yen, versus 970 yen pre-Costco.

Wait, so Yamada-udon's wage goes down from 1,300 yen to 1,050 yen after 3 months? Who wants to work at Yamada-udon then?

The salaries in Japan are just an absolute disgrace. 1500 yen an hour is near poverty this day in age.

I don't know how it is in Japan but Costco employees here seem to be harder working and more competent than their counterparts at Wally World.

No, it’s about the same actually. What I don’t like in Costco or shopping in Japan generally speaking, people will leave their carts all over the place especially in the center aisles and when it’s packed with people and Fukuoka gets severely packed, they’re all over the place, very selfish and inconsiderate of others and navigating through the aisles becomes a literal nightmare. The only time where the staff are strict and push for order is when you line up for the register, they will guide you and your cart into precision position or when you’re at the food court to line you up or during the busiest season times you line up and as you walk in they hand you a shopping cart one by one, other than that, it’s a free for all chaotic environment. So that’s why I personally go an hour before they close or go on a Monday morning. I never go on the weekends. Fukuoka Costco was the original one that opened and caters to over a million people and you have people coming from very far prefectures to go shopping and since it opened here in 1999 you would think they would have more Costco’s in the greater Fukuoka area, but they don’t opened on a Kitakyushu a few years ago and that helped alleviate some of the foot traffic, but its not enough, they they opened one in Kumamoto-about 3 years ago and Ogori will open in this coming November, but still nothing for other prefectures in Kyushu, that just boggles the mind, they could use one, but no…

Why does Costco need to invest in more stores when current ones are packed and the falling population is not being dealt with?

Most Costco's are in the middle of nowhere, not close to public transport and cater only to people who drive. That massive ¥1500/hr would go straight to the car the employee turns up in.

With huge growth in the number of people working these kind of part-time gigs of course a job that pays 50% more than anywhere else will be popular. From what I have heard they also have solid career progression opportunities too.

It's probably not much of their money they pay the slightly higher wages with. Their customers pay almost all of it of course. Membership or let's say entrance fees just for nothing in return? What a scam, demanding money for a few supermarket visits per year. The regularly too big dimensioned product packages also draw you indirectly much money out of your wallet, producing finally not more than an estimated 50% food loss, especially in a more contemporary society with seniors and many single households. Those higher minimum wages there are surely a very nice promotion campaign, but indeed will have a price tag too and additionally hit the business model, I guess.