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Wages in Japan, alone among OECD countries, have been stagnant over 30 years

23 Comments

Books on politics are rarely runaway bestsellers. But it does happen. The success of one written by freelancer Shizuka Wada in collaboration with Constitutional Democratic Party of Japan rep Junya Ogawa is explained in part by its very lengthy title: “If My Hourly Pay Never Rises Above Minimum Wage, is it My Fault? I Asked a Diet Member.”

Wada’s plight – for it’s her own situation she’s describing – is so widespread, explains Spa! (Nov 9-16), that its audience was ready-made.

Now 56, Wada began professional life 30-odd years ago as a freelance writer specializing in music and sumo. Things went well until they began to go badly – her market sagged. To survive she took a part-time job at a plant producing onigiri rice balls. Wage: minimum. Job security: shaky. The coronavirus pandemic hit and she was laid off. It’s not just me, she thought: “My plight is Japan’s.” What would her Diet rep have to say? She decided to ask him

Ogawa, who represents Wada’s home base of Takamatsu, Kagawa Prefecture, was welcoming. Their talk flowed – and became the book.

It ranged over the myriad social problem Japan faces – rapid aging, shrinking economic growth, career-based employment giving way to part-time jobs that lead nowhere and pay little (40 percent of Japan’s current work force is employed part-time), and a social safety net that doesn’t come close, argue Spa! and Wada, to meeting the growing need for it.

Japan alone among developed countries, OECD research cited by Spa! shows, has seen wages stagnate over the past 30 years. They have risen in Germany, England and France; soared in the U.S., and in Japan are almost exactly what they were in 1990 – on average, 4 million yen a year. Many part-timers survive on half that.

Wada translates this into concrete terms. Fifty years ago, she says, 5 percent of an average household income sufficed for rent or mortgage payments. Now it’s 25-30 percent.

Fifty years ago – and 40, and 30 – the vast majority of employment was full-time and, for men at least, lifelong. Lifetime employment was the first casualty of the financial crash of the 1990s. Employers, feeling pinched, curtailed hiring. Such jobs as were available were overwhelmingly part-time, producing a “lost generation” of which Wada counts herself one. That lost generation, now in deep middle age, faces an old age of near-zero savings and helpless despair.

Aging and destabilizing economic change are common to all developed nations, though Japan’s aging outpaces the rest of the world’s. European countries, Wada points out, have expanded their safety nets accordingly; Japan, she says, hasn’t. Japanese government support for essentials like housing and education, she tells Spa!, is less than half Germany’s and Britain’s.

People are being driven into the streets. It’s a cold welcome they receive there. Mention is made of the apparently random murder last November of a homeless woman at a bus stop in Shibuya. She was “an eyesore,” the alleged killer reportedly told police.

© Japan Today

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23 Comments
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Japan alone among developed countries, OECD research cited by Spa! shows, has seen wages stagnate over the past 30 years. They have risen in Germany, England and France; soared in the U.S., and in Japan are almost exactly what they were in 1990 – on average, 4 million yen a year. Many part-timers survive on half that.

Sorry Japan, you are not unique in this regard either.

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

It is a global phenomena of neo-liberalism,not only a Japanese one. In the Japanese case, the change from a relatively small inequality gap during Japan's post war rise and now has been extreme though.

15 ( +17 / -2 )

Thank you dagon. I was about to post the same thing.

9 ( +10 / -1 )

And yet the Japanese people recently voted into power once again the government that has robbed them over the last 30 years while transferring massive funds to the nuclear, construction and military industries.

When will people wake up in this country and put new leaders in place to address income inequality in Japan which is accelerating year by year.

https://en.wikipedia.org/wiki/List_of_countries_by_income_equality

21 ( +21 / -0 )

The thing about japan is even though the wages are low. Living costs are not over the top either. So where I could live quite comfortably on a 3million yen salary in japan a relevant wage in Australia is just above the poverty line.

-3 ( +7 / -10 )

I remember back in 1984, I had a minimum wage job in California at $3.35 an hour. My buddies in Japan at the time were making about 700 yen per hour minimum wage. I always envied them for getting paid so much more. I knew the cost of living was higher in Japan but still their purchasing power was greater than mine.

Fast forward to 2021 and the minimum wage in my prefecture here is 790 yen. Less than 100 yen more than 37 years ago. Cost of living here has gone up considerably too. California is sitting at $14 an hour which is more than 4x what it was in 1984.

Japan needs to get serious and increase the purchasing power of the poor and middle classes if they ever want to get out of this economic funk.

18 ( +19 / -1 )

Tell me something I don't know.

7 ( +9 / -2 )

In real terms,wages have actually decreased since I first came here in '97.

24 ( +24 / -0 )

Another Number 1 for Japan.

6 ( +9 / -3 )

dagonToday  06:59 am JST

Japan alone among developed countries, OECD research cited by Spa! shows, has seen wages stagnate over the past 30 years. They have risen in Germany, England and France; soared in the U.S., and in Japan are almost exactly what they were in 1990 – on average, 4 million yen a year. Many part-timers survive on half that.

Sorry Japan, you are not unique in this regard either.

It isn't much different or better in the USA. It's a disgrace.

4 ( +5 / -1 )

But money goes a lot further in Japan because everything is so cheap.

In the places where wages are rising, people are in much worse actual financial shape because inflation would always be rising faster.

Making 200k per year in US still wouldn't be able to order appetizer or drinks in restaurants or even dare to eat out much and don't have much of a better lifestyle than making 6M yen in Tokyo.

-9 ( +5 / -14 )

Here is the problem, and it is going to get much worse.

https://www.scmp.com/comment/opinion/article/3142290/why-japan-unable-arrest-its-economic-decline-despite-weak-yen

Japan INC refuses to repatriate its profits back to Japan. It is basically a permanent capital flight that will only accelerate much more until there is no money left in Japan.

6 ( +9 / -3 )

Japan has had very stable prices over the same period though so the domestic purchasing power is largely the same.

Real estate has been a rocky ride, but values today are around the same level of the late seventies to early eighties (depending on the measure). No other OECD country is comparable.

The discrepancy is arguably with an artificially weak yen. It “should” be less than 80 to the dollar.

4 ( +4 / -0 )

A clear reason for a commonly known fact….The significantly higher average life expectancy has obviously also quite a price. The same needed lifetime sum is just distributed over more years. Or do you really think and expect the whole globe pays higher prices for products and services to Japan because on average everyone lives some years longer than everywhere else? No, they don’t additionally pay for that luxury while dying earlier themselves. They have more but die young and Japanese have less but in numbers make it into high age groups.

-4 ( +0 / -4 )

Interestingly in Japan it seems rather exceptional to make 10 million yen per year, whereas in the US some new grads in certain professions can almost make that such as in engineering. I think the job market is basically an oligopoly of a few large conglomerates that prevents wages rising. A second reason is that lateral movement between companies is much lower than in other countries, and if you change companies you can expect to start off with 10 or less holidays, a 6 months probation period and a discriminatory work environment regarding laterals.

11 ( +12 / -1 )

Speed

Today 09:12 am JST

I remember back in 1984, I had a minimum wage job in California at $3.35 an hour. My buddies in Japan at the time were making about 700 yen per hour minimum wage. I always envied them for getting paid so much more.

In 1984 the average exchange rate USD-JPY was 237.46 so you were actually earning more than they were. The Plaza Accord only happened in 1985.

6 ( +6 / -0 )

You want to know where your raise went?

Wages have gone up about 12% since the late 1970's, but CEO pay has risen 1,320% during the same period.

Japan CEO to worker pay ratio is low compared to the rest of the world. 11:1

The US is highest at 475:

8 ( +9 / -1 )

But money goes a lot further in Japan because everything is so cheap.

What planet are you living on? Have you seen the price of fruit and vegetables in the supermarkets? Apart from maybe sushi, everything in the supermarkets back home is less than half the price in Japan. 100 yen for the cheapest apple??!!! Sure, Switzerland might be more expensive. I do not want to rely on McDonalds.

9 ( +11 / -2 )

What planet are you living on?

Twenty years ago, Japan was expensive in comparison to the rest of the world. Nowadays it's quite affordable compared to Europe, North America, and Australia.

6 ( +10 / -4 )

I agree with Strangerland that Japan is affordable. Rents, mortgages, health insurance and healthcare, prescription costs are ver affordable. Did you know that is cheaper to fly to Japan and buy eyeglasses from say, Jin, than to get them in the US?

3 ( +6 / -3 )

Food is very expensive in Japan.

If you are a freelancer and pay 100% contributions then health and pensions are also expensive !

The reality is Japan is expensive and if you are not in a highly paid executive position life is generally a struggle money wise and that is the main reason young people are not getting married and having kids.

How is ¥150 a tomato reasonable ?

3 ( +6 / -3 )

Considering the demographics, just expect much more taxes in the future.

1 ( +1 / -0 )

Japan is certainly a cheap country to live in for the quality and cheap prices for food etc.

However, the wages have gone down by 30-50 percent therefore making it a less desirable country to live in for overall mental happiness and income.

japans heyday was good but is gone, yet for those lucky with savings and investments could still be fruitful!

most other should consider to Jump ship ASAP!!

0 ( +1 / -1 )

Who ever said the Japan is cheap is living in an utopia. Just go to the cheapest supermarket and try to buy some fruits, vegetables or meat. The prices are ridiculous. Quality bread is like a luxury here also. Then let talk about rent, properties, etc. You pay 55 mil JPY (half of million $) for a shoe box house of less than 120m2, and you still think Japan is cheap. Hilarious.

-1 ( +1 / -2 )

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