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What do you think of Prime Minister Shinzo Abe's call to companies to raise their employees' wages this spring in order to help stimulate the economy?

22 Comments

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22 Comments
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Splendid idea whose time has come. More money in circulation more get's spent. A small rise in inflation is acceptable as Japan has been at zero or below for many years and that has not helped. Sure beats the approach of western countries who belive in times of economic depression the answer is to make things even tougher for the populace with the exception of the already very rich.

2 ( +2 / -0 )

kinda the tail wagging the dog....

0 ( +0 / -0 )

A good idea. And it doesn't have to be a dramatic increase, maybe an extra 2000- 5000 yen in every worker's pocket.

4 ( +5 / -1 )

I thought he was trying to help Japanese companies reduce costs so that they could be more competitive overseas. Increasing wages after increasing the cost of imported raw materials and operating overseas will make them less competitive.

Companies sometimes do a two for one share issue. Why doesn't Abe do that, a two for one yen issue and double wages at the same time? It seems to be what he wants to do.

0 ( +1 / -1 )

Employers want to rwench the last drop of work out of work units for the absolute minimum pay they can get away with. They are quite happy to work work unis to death as they are always fresh supplies. They will not increase salaries for work unis. Why should they??

1 ( +3 / -2 )

ha ha , that should be "units" not "unis"

-1 ( +0 / -1 )

Well, I don't think many companies will be responding to this call as there is no guarantee that all companies will do it, and if not all companies do it, any company that does it will be relatively disadvantaged.

Another option could be just to make one or multiple cash transfers, like Australia did about 3 years ago - Each working age person in Japan receives 100,000 yen, etc.

1 ( +1 / -0 )

Nice idea. I doubt many companies will do it though. The one I work for certainly won't.

1 ( +3 / -2 )

What do I think?

Not a lot.

Salaries go up, cost of goods go up to pay for the salary increase, price rises, government prints more money, massive inflation, any saved money crashes in value.

Doesn't sound like much of a plan to me.

Unless Abe wants to bankrupt the country, that is.

Then it's a very good plan.

1 ( +3 / -2 )

Good idea.

1 ( +2 / -1 )

What do I think? I'm angry.

His actions and his policies have led to a 27% drop in the value of his own nation's currency (against the dollar and euro) in just a few months. He has explicitly declared war on savers by calling for inflation, and inflation has already arrived in the form of higher prices for energy, which is purchased on the open international market, with now-weakened yen.

And every yen we have in the bank has lost value and will continue to lose value.

Raising our salaries by a few thousand yen will make up for how much our salary can buy now, but isn't going to bring back the lost value of the currency we're paid in and which we have been saving for years. Does he really believe that we savers will feel as if we've been made whole by this flim-fmallery?

-1 ( +1 / -2 )

I have an export company and our profits will definitely be higher this year thanks to the improvements by Mr. Yen. I will certainly be passing this on to my employees in the form of bonuses and raises, since they work so hard for us. These bonuses will be taxed and the governments revenue will go up. Sounds good to me?

-2 ( +4 / -6 )

A stupid idea. Chinese workers are paid $300 to $400 per month, and they are doing ever-increasing amounts of work because more and more foreign companies are moving their production there. Increasing the domestic pay level will only encourage companies to move more of their manufacturing to China and elsewhere. If Mr Abe can make a statement like that, I have to doubt that he has a fudamental understanding of economics.

If Abe wants to help conumers have more money, he should address the widespread corporate collusion and price-fixing situation which exists in Japan. He should change the system so bankruptcies are not social death-sentences (a person who goes bankrupt in Japan loses their right to vote, and finds it impossible to find a job with a bankruptcy on their personal record) which would allow poorly-run companies to fail, and decrease the risk one faces when trying to start a business in Japan.

As usual, the cart is being put before the horse, and no doubt some people are foolish enough to think that it might work.

1 ( +1 / -0 )

It's good for the gov to keep pressure on the companies, look at how they actually have raised the wages, get them to explain their decisions, if possible, and make comments on them, but the wage matter should be left to them first and foremost. In no way should they be seen as evil in case of no wage rise.

0 ( +1 / -1 )

It's the minimum wage that needs to be hiked up. Who would like to work in Japan for 652 yen to 850 yen depending in which prefecture you work ?

1 ( +1 / -0 )

Japan is just a hopeless basket case and there is certainly no future for NJ here now. Companies will not raise wages, probably just keep on lowering them as there so many unemployed people around now.

0 ( +2 / -2 )

Perhaps he could just demand that companies pay overtime? Perhaps he could suggest that women get paid more than 1.3 yen a month and do away with the pension/health care umbrella? Perhaps he could suggest people work less hours and get out and spend more money? Just a thought.

-1 ( +1 / -2 )

I have a bold idea - actually allow employees to use their vacation time, and stop the ridiculous tradition of working overtime even with nothing to do.

By giving the employees more free time, they will be searching for ways to spend their time, and with prices the way they are, they'll want to spend more of it. Time is money.

2 ( +2 / -0 )

There are fundamental problems with raising the minimum wage. First, most minimum wage workers work for smaller shops, grocery, or convenience stores, the types of places which have a rather thin profit margin. An increase in the minimum wage results in an increase in prices, which negates any benefit from the increase.

Second, a comfortable minimum wage has an overlooked consequence, it encourages people to work at the minimum wage level. Minimum wage workers pay little or no tax, and have little money to add to the economy, they merely get by. When the minimum wage is uncomfortable, workers necessarily must find a way to do better, either by getting an education, learning a trade, or starting their own business.

A friend of mine got a part-time job working at McDonald's when she was in high school. The pay was terrible, but she had almost no responsibilities, and no skills. She continued working at McDonald's while attending university, and as her education level increased, so did her pay and responsibility. This motivated her to do better, she went on to finish a masters degree, and then her PHD. 30 years later she still works at McDonald's, but she is now on the board of directors. Had the starting wage been higher, she might not have gone to the trouble to improve herself.

0 ( +0 / -0 )

@umbrella - "work units" lol, good term for many employees.

@Probie - You're not alone, lol.

0 ( +0 / -0 )

Just how is the Japanese government making sure that the wages of their workers will rise? America has been on the QE path for years now but the poor are poorer,more Americans are on food stamps and jobs are being cut.At the same time the differential between the haves and the have nots has risen. The bankers in the UK and the US have received record high bonuses while their banks have had to receive bailouts from taxpayers!!!!!!!

Why should Japan be any different?

1 ( +1 / -0 )

Stupid.

0 ( +1 / -1 )

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