Japan's real wages fall in November at sharpest pace in 8 years

Total failure ok Kuroda 10 years policy. Throwing free money all over the place made things worst not better.

I agree that the government needs a reboot (er... wasn't there supposed to be an opposition party?). However, a lot of the pain is due to the near total shutdown of the economy during the pandemic. We have to rebuild jobs as a nation, not just focus on wages.

Even under normal inflationary circumstances (around 2%), negotiated annual wage rises in enterprise bargaining agreements will be close to, or match this in many countries. Politely requesting companies to raise wages seems a rather limited strategy - do they not have any other means at their disposal? Can you really expect the corporate sector to just come to the party on this? Wouldn't have thought so.

They are going to have to do a little more than that.

And do school teachers really only average just under 300,000 gross??? Wowsers....

There is no financial future in Japan for 75-80% of the workforce. Take income tax, the pension, health insurance, city tax, rent and utilities out of the piddly salary and you are left with nothing. The only way to save money is to live on cup noodles and sacrifice all luxuries. Get out of Japan if you have the chance before you become a financial prisoner. I left Japan three years ago after nearly twenty years of flogging the dead horse. There are many things I like about Japan. it's a great place to visit but, as a foreigner, don't expect to live there and prosper.

There are many things I like about Japan. it's a great place to visit but, as a foreigner, don't expect to live there and prosper.

I've seen this advice a lot over the years. Always struck me as odd given that I know so many foreigners who have built great careers here in many different areas of work.

Japan's real wages fall in November at sharpest pace in 8 years

Is this what Kishida meant by a virtuous cycle of income redistribution under "New Capitalism"?

Take income tax, the pension, health insurance, city tax, rent and utilities out of the piddly salary and you are left with nothing.

The crux of the problem in Japan as well as abroad. Labor income of the working poor is taxed much higher than that of large capital asset holders.

https://www.fool.com/taxes/2020/09/25/why-does-billionaire-warren-buffett-pay-a-lower-ta/

It is highly likely that Kishida has considerable capital assets and pays a lower rate than Taro Suzuki who manages a convenience store.

It is Neo-feudalism.

Defense is the number one eater of wages. Then big oil, big pharma, big justice, big health,….

There is no financial future in Japan for 75-80% of the workforce. Take income tax, the pension, health insurance, city tax, rent and utilities out of the piddly salary and you are left with nothing. The only way to save money is to live on cup noodles and sacrifice all luxuries.

pretty much what we are doing right now.

Get out of Japan if you have the chance before you become a financial prisoner. I left Japan three years ago after nearly twenty years of flogging the dead horse. There are many things I like about Japan. it's a great place to visit but, as a foreigner, don't expect to live there and prosper.

Absolutely! And if my fam and I can get visas to live and work in Canada, I'm binning this place. There is no future here. And its not just the foreigners anymore. With the exception of a few elites, everyone is screwed.

If you work for an international company things are good. For a Japanese company, sorry if you thought it was subsistence before, get ready for things to get a whole lot worse.

I've seen this advice a lot over the years. Always struck me as odd given that I know so many foreigners who have built great careers here in many different areas of work.

Me too. People who are working professionally or who are entrepreneurial can do very well here.

But I also know one or two people who came in their early 20's to work at English language schools in the mid 90's, were earning what was a pretty good salary for that time for effectively unskilled labour, and are still here. They have families, earn the same amount of money they were nearly 30 years ago and are relying on wealthy parents to prop them up financially and inheritance to release them from the bonds of a monotonous working life. Even if they wanted to leave, it's not really a viable option as they have no assets or any prospects of earning anything resembling a professional wage in their country of origin.

Obviously you are entirely responsible for your own choices, decisions and the consequences of those, but I know that they consider Japan expensive and difficult to live in, costs and taxes high.

Not speaking about the original poster, as I don't know his circumstances, just some stories I know of.

Average monthly wages of 368,358 yen are poverty wages, half the rest of the advanced countries; literally half.

Reflection of a failed policy and a reflection of a political party that cannot adapt with the current climate.

Do not urge, create a law with very harsh penelties and extream taxation to companies who take the money and do not higher wages to fund your military build up.

No the LDP only urges, why? Big business keeps them in power.

dagon said it!

Tax those that produce and you get non-production. Easy to see what's happening.

Total failure ok Kuroda 10 years policy

Kuroda doesn't set wages. Employers do. Blame them, as well as Japan 's pathetic labour unions.

Japan's inflation-adjusted average monthly wage dropped 3.8 percent in November 

and in the west it dropped 10%

Low wages if you work for a Japanese company, more expensive essential items, let's keep blaming it on the Ukraine skirmish.

There is no financial future in Japan for 75-80% of the workforce. Take income tax, the pension, health insurance, city tax, rent and utilities out of the piddly salary and you are left with nothing

Absolutely agree. Japan is a high tax country with comparable very low wages and high living costs. That’s also the reason why properties, infrastructure etc. become very old. Despite those things are maintained very well by society, there is no room to invest money into new things.

And then you also have this productivity issue…

There are many things I like about Japan. it's a great place to visit but, as a foreigner, don't expect to live there and prosper.

CommodoreFlag - I've seen this advice a lot over the years. Always struck me as odd given that I know so many foreigners who have built great careers here in many different areas of work.

Many foreigners? How many is many? Are you one of them? I know a of a few, but I wouldn't say many. Most I knew were living month to month and year to year on short-term contracts with no job security and crappy salaries. Furthermore, most I knew left Japan and have since become successful. 99% of foreigners working in Japan are not making any more than ¥3.5M a year. That is not a career. It is just surviving.

Average monthly wages for full-time workers increased 0.2 percent to 368,358 yen, while those of part-time workers rose 2.2 percent to 101,888 yen.

Given most full-time workers negotiate/get pay rises in spring it is not surprising it is low.

Japan's real wages fall in November at sharpest pace in 8 years

This just means inflation was fastest. What will be important is how workers react to the real fall in wages. Given how relatively weak unions are in Japan in most industries I would expect a very moderate rise, if any.

Average base pay and other scheduled wages rose 1.5 percent to 249,550 yen, while overtime pay and other nonscheduled wages rose 5.2 percent to 19,566 yen.

For who? as the following has something totally different and makes all these numbers sound like BS. Whomever wrote this article really needs some help with writing clearly.

For arguments sake, so the average base salary for all workers in Japan rose to about 250,000 (BULL)

By sector, food services saw the largest increase in monthly gross cash salary with a 5.6 percent rise to 124,340 yen, while education saw the largest drop, down 3.5 percent to 295,139 yen.

Food services? What restaurants? Grocery store workers? Bento Shops? Who is included in "food services", and that just can not be "full time" wages Who the hell an live on that after taxes?

Average monthly wages for full-time workers increased 0.2 percent to 368,358 yen, while those of part-time workers rose 2.2 percent to 101,888 yen.

So, the overall base pay and "scheduled" wages is about 250,000, but full-time workers are about 370,000 and PT at about 100,000. So everyone has to remember TOKYO screws these numbers over big time, due to the number of workers in Tokyo alone, they pull the overall averages up throughout the country.

With similar stories in countries around the world - higher taxes for those who actually do the work and going easy on large capital asset holders - one wonders who is pulling the strings. Huge international companies like Nestle and Coca Cola get away with murder and manipulate governments. And we just stand by and watch?

Work more and get paid less-welcome to a decline in your standard of living in Japan!

Jeffrey

Kuroda doesn't set wages. Employers do. Blame them, as well as Japan 's pathetic labour unions.

Yes he does not directly set wages of course, but permanent zero rate policy kept zombi companies alive. A compagny that just survive thanks to free money can not raise wages. Companies are like people they need a minimum of pressure to be forced to adapt to a changing word. For example these companies are very behind when it comes to digitalization compare to other developed countries.

it is fine to save them when there is a big economic shock like 2008 and the Covid crisis but permanent support does not work.

i am talking of small medium companies here I agree that many big companies have huge reserves that they should have distributed more.

3( +3 / -0 )

There are many things I like about Japan. it's a great place to visit but, as a foreigner, don't expect to live there and prosper.

Yet there are countless foreigners who do exceptionally well in Japan financially - which is why they stay. I know of plenty of foreign IT people, corporate accountants, entrepreneurs, business owners etc who are loaded and basically have cash shovelled over them in Japan. 2-3% Inflation means absolutely nothing to them.

No one in their right mind would invest money to increase productivity when the economy is shrinking and no returns can be expected.

Wages in Japan are too low, as is labour productivity by global standards. The two are connected.

As ever, the article quotes largely meaningless numbers that are easily avaiable but do not represent the situation. Simple information like a median number for full time workers would tell us "50% of people earn this or less". Talking about "average base pay", one of many components of pay, just ventures into meaningless detail and presents an incomplete picture. Around 70% of people don't earn "average pay", which is pushed higher by high earners pulling in large multiples of it.

When we have people working full time saying things like "we can't afford kids" or "I'll have to work till I die" (I probably will), I think that is a genuinely life-crushing existence. It's a loaded word, but I would call it "poverty".

Pay rises are expected to be the main focus of the nation's upcoming annual shunto spring wage negotiations between management and labor.

I'll believe it when I actually see it in my salary.

while education saw the largest drop, down 3.5 percent to 295,139 yen.

Yup, I'm sure either that or much larger, not including lay-offs (firings, according to my Japanese wife) and other kinds of screwing by companies that hire foreign teachers.

Kuroda doesn't set wages. Employers do. Blame them, as well as Japan 's pathetic labour unions.

And here is the problem in Japan. Potential employees have almost ZERO say in even attempting to negotiate their salaries. People get hired at a base pay determined by the company, typically low, with added "benefits" that increase the monthly wage, BUT keeps the bonus down, as the base pay is what is typically used to determine bonus payments.

Unions as well are truly pathetic, as the union management are typically employees who have worked for a time in the company, but will eventually turn from the "union" side to management as their careers move along. They dont want to compromise their future by causing problems for the company or current "management"

Even "strikes" , when they happen, are typically one day affairs, announced to the world, well in advance, and become one day events, and then everything goes back to the status quo. There haven't been any strikes, that have made any headlines, for lord knows how many years.

It's a systematic problem that will not change any time soon.

(Yet there is a sliver of hope. Folks looking for work should start using hiring agents. A person doesnt pay them anything, and the agent who is paid by companies and businesses to filter out applicants and find potential employees. There is some, not much, but some, leeway in negotiating salary, the company offers one, through the agent, the prospective employee responds, and so on, until the prospective employee agrees or doesnt. )

B-b-b-b-b-b-b-b-but Kishida PLEDGED to increase wages! Surely the government wasn't lying!

Wages in Japan are too low, as is labour productivity by global standards. The two are connected.

No they arent. Recent research in the real working world shows little correlation between productivity gains and wages. Amazon warehouse workers are a case in point. It's a neolib myth.

It's all about the money. Many companies get rich by underpaying and overworking their workers. That's why we are supposed to have unions.

Pretty shocking when you consider that there is a shortage of workers - even more so since the start of the pandemic. You would think workers would have a decent amount of leverage to demand a fair wage - but like others have pointed out, most unions here go along with whatever management wants.

So, expect to work even more to get paid even less - unless workers start to use the leverage that they have to demand a fair wage.

There is now a #15thOfTheMonthClub movement just getting going among underpaid contract workers and eikawa instructors where they won't be submitting schedules to work on the 15th of any month until wages are increased. Hopefully it gathers some steam.

Many foreigners? How many is many? Are you one of them? I know a of a few, but I wouldn't say many. Most I knew were living month to month and year to year on short-term contracts with no job security and crappy salaries. Furthermore, most I knew left Japan and have since become successful. 99% of foreigners working in Japan are not making any more than ¥3.5M a year. That is not a career. It is just surviving.

if you’re talking about eikawa, then it’s not a career in the first place. It’s an entry level job no different than flipping burgers. there’s nothing wrong with that path but don’t expect financial upward mobility since those that choose to continue as an eikawa do so because they find it rewarding other than expecting financial freedom and gain. Completely pathetic to blame Japan.

99% of foreigners working in Japan are not making any more than ¥3.5M a year. That is not a career. It is just surviving.

Still see many English teachers out in the bars. That wage does suck. I guess they are drowning their sorrows away. That's the only explanation I can come up with.

Someone with decision making ability should invest in the infrastructure needed to support tourism. Niseko and Hakuba are both tremendously popular with both domestic and overseas tourists. But have you ever tried to get to either place? It's a total cluster of competing bus services, nearly nonexistent train service and no easy way to figure things out until you actually arrive. Now I don't think bringing more tourists will make these places better, but it is a great opportunity to create sustainable, enjoyable, bilingual jobs.

So many foreigners like myself are working in financial institutions and earning over 10M a year plus. This is the norm. I heard that english teachers in Japan earn as little as 3.6M a year and it's hard to image such a low salary. But I guess english teachers are all young and don't care about money, they are just thrilled and excited to be in Japan.

As for Japanese workers, they never complain, never strike, they just obey. So wages will never rise in any meaningful way. Nothing will ever change.

As a church representative I am paid a monthly stipend and have never felt it inadequate. There's always enough for a man of moderate needs. I guess if you wish to lead some kind of uber hedonistic and materialistic lifestyle there are better countries to be in.

people may complain about wages and price increases here but compared to the U.K it’s actually not too bad. The price increases there are simply staggering right now even if you earn a good salary. In Japan you can survive on a lower salary somewhat easier than other countries.

With all the doom and gloom posts, how many of you actually see people struggling financially? I sure don’t, maybe 10% is struggling but all i see is the 10K+ per person restaurants booked for months, and most people driving Benz’s and BMW’s. Does wage even matter when people are so stacked on assets?

Hey Kuroda- Kampai

80 more Yrs

So many foreigners like myself are working in financial institutions 

There are about 3 million non-Japanese in Japan. What percentage work in the financial sector? 0.1%??

Just on productivity, but in Japan hours worked per dollar GDP is about $40. In countries like France it is 60. This is not Japanese workers' fault. It is Japanese management's fault for having pointless meetings and not letting people to go home until bucho does. As a high tech country, Japan has massive value-added industries like clean room manufucturing and robots on production lines. It should be beating France into the ground. Huge state-supported inefficiencies in farming and forestry do not help either.

people may complain about wages and price increases here but compared to the U.K it’s actually not too bad. The price increases there are simply staggering right now even if you earn a good salary. In Japan you can survive on a lower salary somewhat easier than other countries.

Yes, this is a paradox or mystery.

My guess would be the crushing cost of real estate in large swathes of the UK. Its a huge transfer of wealth to other people e.g. landlords, previous owners, mortage providers in the form of interest, government in stamp duty....

The way I see my friends in Japan. I look at their parents lives and I realize that their lifestyles will be worse than their parents they are going backwards.

Aly RustomToday  07:55 am JST

Aly, you've been mentioning about the Canada visa for quiiiiite a while.... hope it comes through for you!

The only effective solution is to move back many of the manufacturing jobs which went overseas, esp to China. Some of those jobs are good jobs, and should be done by Japanese people, and this is not just economic but also geo-strategic. This will force up real wages, and improve quality of products too.

This is along side an article that companies plan to hire more new grads. So basically, they won’t increase salaries but what they will do is get rid of higher paid employees and bring in new grads so they can say they will be increasing salaries moving forward and because it will make them look good because they’re helping bring up a new generation. meanwhile the upper management for making the decisions that have turned Japanese companies to the dumps are enjoying their benefits at the top.

Aly, you've been mentioning about the Canada visa for quiiiiite a while.... hope it comes through for you!

Thank you. So do I, but since the pandemic, its been extremely hard and I am not so sure we'll be successful.