business

Gov't panel proposes more support for firms hiking wages

31 Comments

The requested article has expired, and is no longer available. Any related articles, and user comments are shown below.

© KYODO

©2021 GPlusMedia Inc.

31 Comments
Login to comment

Rather than providing more corporate welfare for companies, why not provide funds and more support for labour unions. It's a historical fact that a strong union movement leads to better living conditions for workers.

Another impactful move would be to strengthen the government's Hello Work database and recruitment system and tax the private recruitment agencies into oblivion, as these outsourcing agencies thrive on garnishing workers' wages. With the available technology today, there is very little need for these rent seeking middle agents.

22 ( +24 / -2 )

Keep printing more yens!

-7 ( +5 / -12 )

An economic policy panel of Japan's government on Monday proposed a fresh stimulus package to get the coronavirus-hit economy back in shape, including beefing up support for companies actively raising employee wages.

You know cutting corporate taxes, subsidizing them while their profits increased with Reaganite, Koizumi neo-liberlaism was going to lead to that sweet trickle down that would raise all boats? It hasn't happened for 30 years but now we will try something new.

We are just going to bypass workers and give money directly to companies if they pretty please promise to wage raises.

There has been great enforcement of other labor rules hasn't there?Oversight, enforcement; there probably will not be any budget for that.

"Through discussions there, we will draw up a 'grand design' and measures to put it into practice in spring next year, and introduce them to the world," he said.

This sounds so portentous , like he has not had a career in the ruling party to formulate his grand plan.

"Only after distributing (profits) to their employees in the form of wages would consumption expand," the panel said, adding that should there be a rise in consumption and growth in demand, "corporate profits would further increase, leading to (more economic) growth."

Through all those meeting they finally discovered trickle down economics doesn't work. They could have asked anyone on the street.

14 ( +15 / -1 )

So the answer for them is more state welfare for businesses, not any talk about anything considered actual people, you know those who drive 60% of the economy domestically. Guess they are supported by being allowed to have a part time job.

7 ( +9 / -2 )

Support those businesses who don't care about their employees.

What a great idea. And as always it's proposing, recommending, suggesting and so on.

The (positive) results (for those employed) will be little to none at all.

11 ( +13 / -2 )

Present Kishida regime who won the election with support from vested interests including supporting group of opposition parties will be not able to change something drastically.

8 ( +9 / -1 )

Well, the other comments above nailed it. Giving money to failing businesses does not sound like a very innovative economic policy, Kishida-san.

12 ( +12 / -0 )

Everything was just sweet nothings for the election, trickle down is not "new capitalism" and doesn't work. He can't force any corporation to increase wages and even if there are increases it will only be bread crumbs to appease the union for the annual collective bargaining. No union? No luck. Also, the mere fact that he's only now going to set up committees and come up with a "grand design" implies that he never had the nuts and bolts worked out while spouting off his campaign rhetoric, just fancy buzz words. Absolutely no sense of urgency, good luck Japan.

6 ( +6 / -0 )

For the average worker the increase in salary will only cover the increase in taxes.

7 ( +7 / -0 )

Right, use tax payers money to "support" companies that increase wages.

Am I the only one here who thinks something is totally wrong here? I mean large corporations here have been making money hand over foot for the longest time now, and employees real wages have steadily decreased. Not to mention the fact that this basically is talking about "full-time" employees, which have become and even smaller percentage of the overall work force!

Want changes? Drop the mandatory retirement at age 60! Companies retire these employees at 60, but keep them on until at least 65, at 1/3 or less salary, and almost no benefits, if any, AND they are still doing the same work!

Want changes? Raise the minimum wage to a "living" wage!

Oh and let's not forget dropping the 100 hour per month "maximum" ceiling on overtime! If that is going to stay in effect, then make it the LAW that corporations have to pay double-time or more for ANY overtime at all.

There are more institutional changes that need to be made before any "government" support should even be considered!

8 ( +11 / -3 )

Japanese companies have been asked to increase wages for a long time now and have not done so. Why should they? Japanese Nationals will show up at work because they are loyal to their owners.

8 ( +10 / -2 )

An economic policy panel of Japan's government on Monday proposed a fresh stimulus package to get the coronavirus-hit economy back in shape, including beefing up support for companies actively raising employee wages.

It is like they have never heard of the concept of UBI, that would serve as welfare and a boost to the woeful wages of the majority of the workforce in contract, zero hour labor. A majority of the opposition parties, even the Innovation Party, have it in their platform.

With the LDP, in cronies we trust. Everything has to pass through the hands of Keidanren and Dentsu first.

3 ( +8 / -5 )

Give tax credits to PARENTS who are paying CHILD SUPPORT so they can start supporting their own kids and NOT rely on the government support only.

Most divorced parents are NOT paying child support because there are NO merits.

4 ( +5 / -1 )

Finally minimum wage will be increased by 3 more Yens.

4 ( +7 / -3 )

The people in need are part time and dispatch workers, salary men on ¥8 million a year don’t need help with pay rises. Abenomics didn’t work, why revisit money printing when the yen is already weak?

6 ( +6 / -0 )

Sounds good, especially rural development. Sidewalks would be nice as well.

-2 ( +0 / -2 )

So the Japanese government, with its massive world leading deficit, will pay companies to pay its workers more (maybe). What nonsense.

Start by paying the poorest workers at least a living wage, which 930 yen per hour (40 hr week = 37,200 yen) is definitely not.

I am tired of hearing that this will hurt small businesses. Sorry boss, but if you can't pay your workers a living wage, close down and go look for a job yourself. Plenty out there right now at 930/hr.

4 ( +6 / -2 )

Increasing the minimum wage would be the simplest solution, with no bureaucracy involved, and would ensure that all employees would get an increase.

0 ( +1 / -1 )

signature vision of a "new capitalism," the panel also suggested a large-scale subsidy program

So ”new capitalism” is “more big government socialism”.

Gotta have a political slogan though… but how Orwellian

5 ( +5 / -0 )

"Only after distributing (profits) to their employees in the form of wages would consumption expand," the panel said, adding that should there be a rise in consumption and growth in demand, "corporate profits would further increase, leading to (more economic) growth."

What if this new panel of central planners is wrong, much like the panels of the last 3 lost decades?

4 ( +4 / -0 )

If Japanese companies can layoff workers easily when they go into red, they will pay more to workers when they make profits. But Japanese companies have to save money to maintain permanent hire system.

-2 ( +2 / -4 )

Can't wait for 50¥ hike.

5 ( +5 / -0 )

So also and again the many poor or everyone without being in employer-employed relationship all pay with their tax at the supermarket and for other services the planned benefits for already rich companies and wage hikes for employees who are already well equipped with jobs and income? Nice try. That’s not a new capitalism, that’s very obviously the most brutal capitalism one can think of.

4 ( +5 / -1 )

Gov't panel proposes more support for firms hiking wages

I guess that support for workers is considered "too radical" an idea in Japan, eh?

*An economic policy panel of Japan's government on Monday proposed a fresh stimulus package to get the coronavirus-hit economy back in shape, including beefing up support for companies actively raising employee wages.*

Which means? How much are we talking? +10 JPY an hour (so, 1,600 JPY a month assuming 160 hours / month)? More? Less? Are we talking percentages of increase? Perm staff? Gig-staffers? Fuzzy at best. Not holding my breath.

*As part of its "urgent proposals" toward realizing Prime Minister Fumio Kishida's signature vision of a "new capitalism," the panel also suggested a large-scale subsidy program to encourage the digitalization of rural areas, as well as assistance for building state-of-the-art semiconductor factories to ensure a sufficient supply of computer chips.*

To achieve what exactly?

As a specific step to promote the digitalization of local regions, the panel suggested legislation to set rules for better use of drones and robots to deliver food and commodities in rural areas with limited means of transportation.

This is hardly "digitalization". This is about logistics.

Also, how much "food and commodities" can you deliver via one single drone? BTW, I can understand disaster-relief, but starting to provide this kind of support to rural areas as a routine governmental task? This does not even remotely look like a job for the government, does it. This calls out for commercial outlets, supermarkets, distribution centers which are private businesses. Dwindling numbers in residents make this business increasingly difficult to justify, hence private operators bailing out. So, is the government aiming at what exactly, opening drone-based delivery supermarkets at tax-payers' expense? You joking, right?

Anyway, as inaka-regions are slowly dying out, this would at best keep them going for some time but ultimately, die out they will...

*"Through discussions there, we will draw up a 'grand design' and measures to put it into practice in spring next year, and introduce them to the world," he said.*

Here we go again: trying to impress the world. What about trying to impress the locals for a change? BTW, the world has not yet been much impressed by 21st century Japan, me thinks...

To facilitate pay hikes, the panel said some subsidy programs should be contingent on businesses agreeing to raise their employees' wages.

Well, there are essentially 2 types of companies:

.those which could raise wages but aren't (e.g. big corporations)

.those which can't because:

..whatever service or product they sell, well, doesn't sell...(e.g. too expensive, too many other (better, cheaper) alternatives or for whatever reason no (further) interest from buyers

..whatever service or product they sell, they are bad at selling despite having a good/cheap or even rare product

In both above cases, these companies suffer from shoddy management, just survive on a cheap-labor-strategy and are essentially walking the way of the dodo bird...Anyway, these companies are barely surviving so raising salaries is pretty much a non-starter to start with.

As for companies who could pay, they should be made to pay. PERIOD! Remember: "lawmakers" are supposed to, well, "make laws", not utter "calls" or "urges" or offer "trade-offs".

The proposed scheme asks for these to increase wages and user tax-payers money to make it up for them (the corporations increasing in wages) which is nothing more than simply transferring public funds into corporate balance-sheets with at one point down the road an increase in individual taxes waiting in order to make up for what is a stupid, unnecessary public spending. LDP-economics for ya!

It has been pointed out that under the current tax break incentive system, companies posting deficits and not paying taxes cannot receive the benefits even if they raise wages.

Which means or hints at what exactly??? Are we going to consider subsidizing increases in wages for what are essentially zombie companies suffering from shoddy management? Wouldn't be surprised, as we can't have them fail, as failing would move workers from "employed gig-workers" to "unemployed workers"-status and, muuuuch more important, have bad-debt owned by banks fail and hit them and have them scream murder! Again, LDP-economics for ya!

"Only after distributing (profits) to their employees in the form of wages would consumption expand," the panel said, adding that should there be a rise in consumption and growth in demand, "corporate profits would further increase, leading to (more economic) growth."

"Distribution strategy is a vital basis supporting growth," it also said.

Peanuts wage increases are not going to change anything. Neither are individual tax-increases waiting to happen to make up for this nonsense and hit household spending capacity.

In terms of ensuring Japan's economic security interests amid a global chip crunch, the proposals include preparing "multiple-year" support and necessary systems for attracting high-end semiconductor factories of foreign manufacturers such as those of Taiwan, which the panel said would "contribute significantly to national security."

Agree. Completely agree, but..

...This relies on foreign manufacturers willing to come to Japan to do so. Japanese "sontaku" (忖度) does not work well with outside actors. Why do I have the feeling that somewhere down the lane, luring them with tax-breaks and incentives (financed through public funding) will be key to do so. Again, who will pay for all this? Me thinks I know...(shudder)

Presenting a plan to establish a 10 trillion yen fund for universities by March, the panel also highlighted the need to promote innovation by strengthening the science and technology field, saying it will provide a "spark" for generating the virtuous cycle of growth and distribution advocated by Kishida.

(Again) Agree. Completely agree, but..

...A first step maybe to support scientist and researchers. Saw a few news / documentary segments these last years about Japanese scientists being underfunded (heck, even paying for their activities/reasearch out of their own pockets for crying out loud!) and dreaming of...leaving for kinder shores. Would love to see a white paper on a possible "brain-drain" taking place.

All-in-all, the plan seems to boil down to "spaff money all over the place", not asking too many questions about, you know, stuff like: priorities, efficiency, return on investment, sustainability, funding (i.e. taxing), etc. So, not really different from what was done these last 30 years, but with a "newer" packaging of sorts...

-2 ( +1 / -3 )

New capitalism?

Jgov's latest euphemism for crappy policies. No wonder Japan is heading into third world status.

1 ( +3 / -2 )

Maybe we should call it Krapitalism

2 ( +3 / -1 )

Increasing wages, results increase in health insurance, pension and income tax. Even 100yen/day increment does more damage to working class. Govt basically instructing companies to pay them indirect way. If you are so worried about working class please give them tax break. Also, if you insist companies to increase wage please consider to increase income rage for tax calculations too (*lets do your part first).

3 ( +3 / -0 )

In 30 years salaries have not changed, yet taxes have risen.

The effect of this is to make the Japanese people and those working in Japan poorer.

Companies won’t raise wages without laws requiring them to or labour shortages which require them to do so.

I found the best way to earn more money was outside Japan…

1 ( +2 / -1 )

I can make most Japanese companies more profitable over night, get rid of the blinking Hanko stampers and papper pushers, as for the goverment initiatives, well I am rather sceptical about them, its good intentions, but are we only painting over the cracks, rather than fixing the problems?

4 ( +4 / -0 )

Give tax credits to PARENTS who are paying CHILD SUPPORT so they can start supporting their own kids and NOT rely on the government support only.

Huh? Give tax credits to the parent that is raising the kids! Read what you wrote, you are STILL using tax money to support the kids either way!

Most women who divorce their husbands here dont want their ex involved in their kids, or their lives. These women CAN get child support from the ex, but choose not to. The courts can garnish their wages as well.

Most divorced parents are NOT paying child support because there are NO merits.

Wrong, it's not about merit, it's about mostly mother's here, not wanting ANY contact from their ex's.

THere is a HUGE merit, but it also means that they are still tied to their divorced spouse, and few want that!

I really wonder where you got the idea that having a spouse paying child support has no merit. That's weird!

1 ( +1 / -0 )

This hike will only mean more taxes! The businesses will not take a loss as wages go up so does the cost of goods. The income looks larger on paper but the grocery bag items are smaller and less.

0 ( +0 / -0 )

Login to leave a comment

Facebook users

Use your Facebook account to login or register with JapanToday. By doing so, you will also receive an email inviting you to receive our news alerts.

Facebook Connect

Login with your JapanToday account

User registration

Articles, Offers & Useful Resources

A mix of what's trending on our other sites