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Japanese companies tighten belts, declining to offer base pay hikes

22 Comments
By Tetsushi Kajimoto and Naomi Tajitsu

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22 Comments
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Japanese firms will always find reasons to decline pay raises. It's a pandemic. We don't know how long the strong economy will last. Spending has decreased. We are worried about the low birthrate and future spenders. The sun is too hot. The rain isn't wet enough. Literally any reason.

19 ( +21 / -2 )

@JJ Jetplane

That's because Japanese productivity is very low, mostly because of excessive red tape and protectionism, but also inflation. If productivity does not increase, any rise in the wages means increase in prices.

12 ( +13 / -1 )

@Ilovecoffee

That's because Japanese productivity is very low, mostly because of excessive red tape and protectionism

I agree and I understand that. But eventually, companies need to stop valuing the process more than the outcome or effect. The inefficiencies of the workers are mostly due to a system the prioritizes process. Japanese companies are the ones that are spearheading the reduced workday movement in the world. Yet, in Japan, they won't give that same opportunity to their own people. Toyota was the company that first implemented a 6 hour work day and found people were much more productive and more happy.

8 ( +8 / -0 )

If it weren't this, they'd find another excuse not to raise wages.

11 ( +13 / -2 )

Good news, employment security for the “seisha in”.

Bad news, when the economy goes bad, and we haven’t seen bad, but it’s coming, bonuses cut to zero and base pay can be cut as well.

5 ( +5 / -0 )

40%. Shameful

0 ( +2 / -2 )

If it's not one thing, it's another, yet I am quite sure that everyone would appreciate a "rise" of 8,000 per month, IF it's their base pay that is! That is an increase of roughly 100,000 in monthly salary over the course of the year, plus for Toyota, an additional 540,000 in bonus, as their bonus this year will be 5.4 months of salary.

So they are getting roughly a 640,000 yen "rise" in overall pay.

THIS however is such a tiny portion of the overall work force! Yet other automakers are giving a similar "rise" in pay to their full time employees!

SO in reality it SUCKS for about 30% of the overall work force! Who arent full-time!

2 ( +3 / -1 )

It would be a great time for many of those at the top to step aside and retire. They can afford it. Let the younger workers who can't afford to be laid off continue working and contributing to society. That won't happen though. At many Japanese companies, you'll see the 60+ guys continue to hoard and receive the big pay checks for sitting behind desks doing nothing.

4 ( +6 / -2 )

At many Japanese companies, you'll see the 60+ guys continue to hoard and receive the big pay checks for sitting behind desks doing nothing.

FYI, this is a major fallacy! If you work at a Japanese company you "retire" at 60. Sure you can continue to work, until you are 65, BUT, you no longer get bonuses, are a contracted employee, and generally speaking, take roughly a 30% or higher pay cut, but do the same job.

-1 ( +1 / -2 )

Darned, wish I would get that kind of pay raise!

0 ( +0 / -0 )

Bwahaha! Who didn’t see that coming? These companies were just waiting for a legit excuse. However, didn’t the government state a few days ago they had allotted a few billion yen to support companies during the virus pandemic? Obviously this will not used for salary increases.

-1 ( +1 / -2 )

Poor excuse for not respecting the workers who generate company profits. Does same apply to directors or they just up their expenses?

-1 ( +1 / -2 )

Everything is SUPER slow here compared to any other country or tribe.

However when it comes to not pay (enough) for the work done, surprisingly the actions are very quick.

With the TAX hike, don't come cry after if no one is buying your already too expensive JP products.

0 ( +1 / -1 )

Japanese companies are smart. Looks like stupid Boeing may go out of business with its fancy business model of outsourcing and recent buyback of its shares at sky high prices! Now its stock is cratering and the company itself bought high!!!

2 ( +2 / -0 )

Over the past six years, major firms raised wages more than 2% each spring as Abe pressured businesses to boost pay to put an end to deflation and stagnation that has dogged Japan for two decades.

Pressured.

Urge and Pressure don't mean the same.

1 ( +1 / -0 )

Most Japanese companies have been earning good profits for a decade and most can ride out this virus storm.

-1 ( +0 / -1 )

Math. And English.

-1 ( +1 / -2 )

Thanks to near zero interest on deposits, Japanese firms enjoy almost interest-free borrowing, markets shielded from having to compete against cheaper and superior foreign products, and economies of scale which allow them to reap very high returns on investment. Apart from the favoured seishaiin few, the profits are not fairly distributed but go into building massive war chest strategic reserves to buttress them in times of need and underpin their predatory expansion into other markets which would be considered treasonous surrender if it was foreign firms picking the eye teeth of established Japanese firms. The prevailing philosophy is why play with a model that underpins Japan Inc’s ability to ward off the Black Ships and undergirds her ability to make inroads elsewhere.

-1 ( +0 / -1 )

When Japanese? companies can produce and manufacture in Mexico, Vietnam, and China etc Then it is logical to assume that wages for the same jobs in Japan will never rise.

The Japanese idea of their own unique exceptionalism is now just a sad myth and that is reflected in the wages that we see in Japan...

1 ( +1 / -0 )

@Yubaru

So, Abe, Aso and all his cronies have had a 30% reduction in their salaries as they reached age 65? Show proof on that with link please.

0 ( +0 / -0 )

The only way in Japan, to get a pay rise, is to leave the Company and go to somewhere that will pay you more.

0 ( +0 / -0 )

@zichi - in Japan, when companies start loosing money within a Fiscal year, they can legitimately dismiss Employees without experiencing the wrath of the Unions. So watch for higher unemployment figures - which really is a bad thing, as the long term unemployed are not counted (check the Government Statistics Web page for that gem).

0 ( +0 / -0 )

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