Pedestrians stand in front of sale signs on a shopfront at a shopping district in Tokyo. Photo: REUTERS file
business

Japanese businesses see economy peaking out, want more stimulus

23 Comments
By Tetsushi Kajimoto

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23 Comments
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Raise wages not even a topic, further tax breaks for companies and stimulus cash that's ok. But raising wages of tax payers....never.

4 ( +4 / -0 )

The opening paragraph forgot to mention the government telling people they need to save 30 million to retire.

3 ( +3 / -0 )

These negative projections are always timed right before the decision to not raise wages. Based on the projection, just keeps going in a circle.

3 ( +3 / -0 )

The companies are making big profits but not passing it on with wage increases. Make them pay more taxes if they don't share the profits with their workers.

5 ( +6 / -1 )

Part of the problem is the antiquated labor laws that protect permanent workers to an extreme. I work in a large company and my boss will retire early this year at 55, and in addition to his massive retirement bonus, he will get an additional 3 years salary paid in a lump sum just to leave. However, next to him we have dispatch persons who don't even get paid holidays. This disparity is more stark than in the US!

9 ( +9 / -0 )

@zichi

The companies are making big profits but not passing it on with wage increases. Make them pay more taxes if they don't share the profits with their workers.

Totally agree with you but we have soft fascism here so things wont change.

6 ( +7 / -1 )

You want stimulus? Open your bank account up and start using YOUR money.

-2 ( +2 / -4 )

Increase the wage so that people have enough to spend. The stimulus given to these companies were more than enough, but I guess the owners have bottomless pockets to fill.

I also agree with Reckless, the labor laws should be updated. Reward productivity instead of promoting people on basis of seniority. Again, Japan must learn the concept of substance over form.

1 ( +2 / -1 )

What these dummies dont understand is that their workers are consumers. Pay them more and they will spend more, boosting the economy. The poll respondents are either really stupid or really disingenuous.

1 ( +2 / -1 )

want more stimulus

How about a tax cut? They're working great in the U.S., economy is roaring and unemployment is low.

-1 ( +3 / -4 )

@cricky

Said it best. They seem to be aiming to put more money into company pockets. Japanese companies already have an incredible amount of cash and assets. They are clearly not trying to stimulate the economy. Because one of the biggest ways to stimulate the economy is consumer spending. If wages are on the decline while prices keep going up, it doesn’t matter how many tax cuts or stimulus you give out, people still can’t purchase your products.

Generate more laws to force companies to give livable wages.

1 ( +2 / -1 )

If it wasn't for sales of hair tint preparations and mobile phones, corporate Japan would have gone bust years ago.

0 ( +0 / -0 )

if they don't share the profits with their workers.

No.

Workers are paid wages, sometimes a bonus.

Profits go to shareholders.

Workers can become shareholders too, should they wish, for the risk of putting their money into an investment that may lose all the money.

Shareholders would sell if they were left with less profit and no reduction in risk. Maybe putting workers out of a job.

2 ( +2 / -0 )

Japan has been in a contracting economy for over two decades. Various economic stimuli attempt to mask this, but they do not change the underlying economic reality.

If business models are now built around the expectation of a government stimulus every time the economy gets rocky or the last stimulus wears off, then there is nothing healthy whatsoever about the Japanese economy.

Japan wants to use monetary inflation to dig the country out of its debt hole and economic slump. It largely hasn't worked. Wages haven't risen enough, and spending hasn't increased enough. People either don't have money to spend or else aren't willing to spend it because they have no confidence in the government social safety net.

What Japan needs is greater creativity and innovation, higher productivity, and more wealth creation. The perpetual economic stimulus state of the last two or three decades hasn't delivered.

2 ( +2 / -0 )

When the profits of a business increase due to the effort by their workers then they have also earned a wage increase but giving dividends to the stockholders. Stockholders usually buy into very established companies and are not putting their investments at risk.

In other countries, the wages increase as the profits increase. Better for the general economy with more money being spent.

0 ( +1 / -1 )

dummies dont understand is that their workers are consumers. Pay them more and they will spend more, 

Pay me more and I invest more overseas, not buy more stuff here.

They aren’t so dumb perhaps.

0 ( +0 / -0 )

Japan is the land of the shrinking consumer class due to the aging, shrinking population. We are kidding ourselves if we think Japan could consume its way out of the almost 3 decade rut.

0 ( +0 / -0 )

In other countries, the wages increase as the profits increase

correlation or causation?

wages go up when labour is in demand and labour supply shrinks or stays the same. Not because of profits. This applies even in Japan, although politicians try to work around it by bringing in cheaper foreign workers.

0 ( +0 / -0 )

Pay me more and I invest more overseas, not buy more stuff here.

Then you care so little about the country providing you with an income, you are happy to bleed it dry and move on when it runs out.

0 ( +1 / -1 )

@zichi

The same way many things are made overseas, even things in Japan have countries where labor is cheaper making them. At the end of the day, businesses and consumers should do what benefits them.

How many people in the US make money in the US and send a large portion of it back to their home countries? How many rich people use other countries as tax havens ultimately weakening their own country's economy?

Furthermore, why hold allegiance to any country when their highest priorities are to corporations and the top 1%?

1 ( +1 / -0 )

JJ jetplane

Then I guess you don't support the idea of the local economy just like "Buy American" "Buy British" "Buy Japanese". We try to buy local farm produce or buy from a shop with owners as much as we can to support the local economy.

Furthermore, why hold allegiance to any country when their highest priorities are to corporations and the top 1%?

Then why even live in Japan or make business here?

-1 ( +0 / -1 )

@zichi

I was not speaking only about Japan with my comments. I am talking about the current role of government in general. One of the biggest reasons many governments have rising deficits is because taxes on corporations and the wealthy have shrunk considerably compared to 40 or 50 years ago.

Deficits used to be held in check because of the taxes on the rich and on high earning corporations. Today, in most countries, the tax rates on the more wealthy population and corporations are a fraction of what they used to be. They have consistently gone lower while taxes on the middle class tend to fluctuate up and down.

Also, my reasons for living in Japan is simply that I gave up my liberties, my career, and comfort for someone that is far more important than myself. As simple as that. I don't hate Japan. I see Japan the same way I see any other country in the world.

-1 ( +0 / -1 )

Then you care so little about the country providing you with an income, you are happy to bleed it dry and move on when it runs out.

My labour is what provides me with my income, not this country.

I invest my savings in overseas investments because overseas has better options than buying shares in domestic companies. Nissan? No thanks. Leo Palace? No thanks. etc etc. I'm sure there are some good ones, but I prefer my chances with overseas companies on the balance.

Now, as for my relationship with this country, I pay way more than average in taxes, do consume what I consume, and even help supply this place with additional Japanese citizens, who may potentially consume and pay taxes here in future too. So I think this country has done well for having me, even if I do choose to risk my investments elsewhere, as if I were never living here in the first place.

But I do admire your sense of obligation to the strip of dirt upon which you live!

1 ( +1 / -0 )

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