politics

Abe calls for pay hike for 5th year as wage growth remains tepid

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So, he has gone from "urging" to "calling", as he gets more and more power, I suspect that next he will start "ordering".

3% raise is going to do little to cover the expected rise in consumption tax, and for some, IF (huge if) they do in fact get any raise, they will end up making LESS money due to increased costs as well!

Leave the damn consumption tax alone! Raise wages, and tax revenues will increase on their own. People WILL buy more, if they feel the economy is stable, and that there are no stupid tax increases coming in the near future!

14 ( +15 / -1 )

such a small increase, well its better than nothing.

0 ( +2 / -2 )

Five years, and still we have seen almost nothing in the way of wage increases, and still people voted for this man's party! The thing I don't understand is why are these companies hording cash? This is Japan, if you fall into trouble, the government will invariably bail you out, so it is a no lose situation. And what are they doing with all this cash, since Japan has negative interest rates, they must not be holding it here, or it is invested meaning they are making more money, and then just sitting on it.

10 ( +11 / -1 )

I hope Abe would be focusing on it, not just calling it. He should spend more time on this one, instead of his war-enabled constitutional change.

6 ( +8 / -2 )

MarkX - Five years, and still we have seen almost nothing in the way of wage increases

Don't leave it at wage increases. The truth is, there has been no economic growth or improvements in stability. Yet, companies are recording record profits. This only means, the rich are getting richer and the poor are getting poorer by not passing on profits to the middle and lower classes as wages. The middle class in Japan is declining rapidly into the lower class, just like it was 300 hundred years ago.

10 ( +13 / -3 )

It is a choice of Japanese workers also. If they accept frequent "hire and fire" hiring system, corporations will return all the profits they make to workers. But when business does not go well, they will say to you "Sorry, we can not keep you at the company. We do not have money."

4 ( +4 / -0 )

"We will never drop the flag of fiscal reconstruction," Abe told the panel meeting.

How can you drop something you never picked up in the first place?

6 ( +7 / -1 )

Talking about something he has no control over. The title might as well have said "Abe wishes for..."

7 ( +7 / -0 )

raise wages 3% while raising taxes 10%? I am not a math major but.....

-1 ( +3 / -4 )

Once again he is at it...the best he has achieved with his previous calls for pay rises was increases at the top tier companies ( mainly even if not exclusively the exporters ) for the workers that are already amongst the best paid in Japan while most workers at small companies got jack all. How about legislating an increase in the pathetic minimum wage so that Taro who doesnt work at Toyota can have a little extra to cover all your tax increases Shinzo? Too hard?

7 ( +9 / -2 )

Dango taxes will rise by 2% to 10%, wish we still had the 3% consumption tax.

-1 ( +1 / -2 )

I’m not sure who this 3% increase applies to, just the unions? Most full time employees have a natural uplift of around 1-2% with more added for individual performance, etc.

This wage increase call seems to me to be more aimed at manufacturers. Either way no company can be compelled to increase wages

1 ( +1 / -0 )

@pacint with the taxes proposed it will be a 10% increase since Abe took over

-4 ( +1 / -5 )

@Dango bong. They are planning to raise the consumption tax TO 10%, not BY 10%. It's a crucial difference. If Abe is still around at the time of the proposed hike in 2019, he will have overseen a 5% rise.

4 ( +5 / -1 )

Sounding too political there Mr. Abe..

-1 ( +0 / -1 )

Abe calls for pay hike for 5th year as wage growth remains tepid

And nobody is listening because nobody cares

-2 ( +0 / -2 )

I hope to see wages raised by 3% in next spring's wage talks

I’m hoping for a call from Maria Sharapova asking for a night out.

It’s a wonderful idea that hope thing.

2 ( +4 / -2 )

this is all lip service to voters to show them that he's trying his best to help workers. yeah, right. then why has he changed labor laws to favor companies? why does he allow companies to hire so many guest workers and pay them a fraction of what a japanese person would earn? why does he allow companies to not pay overtime and allow companies to have workers work over 200 hours of overtime a month? smh...

5 ( +6 / -1 )

hehehe Abe is so funny. Lets talk about something more practical.

3 ( +4 / -1 )

Japan needs more than Abe urging and hoping....,

4 ( +5 / -1 )

Abe should have realized that this is what he signed on to promote shareholder capitalism, aka "free market economics," aka neo-liberalism, aka "trickle down economics." This what "market reform" is about, folks: the rich get richer.

Corporations' priority these days is to reward shareholders, not workers. How obvious is that?

3 ( +4 / -1 )

In western nations, people are clear that companies belong to their shareholders.

In Japan, there is clearly not the same degree of recognition, considering you have the Prime Minister of the country pontificating about what he'd like to have happen. He should mind his own "business", and take care of his own responsibilities instead.

"I hope to see wages raised by 3% in next spring's wage talks," Abe told a government panel meeting at his office. 

I hoped to see your frikkin' 3rd arrow, 4 years ago.

Abe also said the government will take "all possible measures" such as taxation and regulatory reform to lay the groundwork for companies to spend their record profits more on wages and capital investment.

Ah! The 3rd arrow! Perhaps the wage rises and investment will occur after you actually fire it!

But wage growth remains tepid as companies prefer hoarding cash for the future. 

This is just a nonsense statement. 

Wage growth is tepid in Japan because people don't often change jobs in demand of higher wages for their labour, so normal market forces just don't apply in Japan. 

Just as there is a misunderstanding in Japan about who companies belong to, there is a misunderstanding about what causes wages to rise.

Japan's adaptations of capitalism to its local culture have resulted in a broken system. Japan either needs to embrace capitalism and individualism in the economic sphere, or it might as well just adopt a central command communist model instead.

-2 ( +0 / -2 )

Abe doesn't have the slightest interest in helping the millions in the lower class.

4 ( +4 / -0 )

The thing I don't understand is why are these companies hording cash? This is Japan, if you fall into trouble, the government will invariably bail you out, so it is a no lose situation. 

I don't think there is such a guarantee. Sharp staff did not seem happy to be bought out by the Taiwanese, for example.

As for 'hoarding' cash, if you are Japanese company management, you know that you can't lay off your full-time staff when tough times arrive because of the rigid labour laws, so you need to have cash on hand to be able to keep paying your employees when things turn sour, lest you face insolvency.

But in other economies, companies are recognised to belong to their shareholders, and if the company has something better to do with the money it will, or otherwise return the money to the shareholders, who will then be free to decide what better to do with it. The management will be fired otherwise.

In Japan there is a socio cultural view that companies belong to their employees, more than their shareholders, and the system results in company management behaving in ways that favour the long-term employment of employees over the shareholders that they are all supposed to be working for. Wages don't go up but long-term employment is what is expected, rather than increasing wages for improving performance.

-1 ( +1 / -2 )

can he guarantee a pay rise if i print and show it to my boss?

5 ( +5 / -0 )

Just a quick math correction: 8% to 10% is a 2% increase in absolute terms, but it is actually a 25% increase of the current tax rate. And going from 5% to 10% during abe's reign is a 100% increase. So after the next rise we will be paying 100% more sales tax as compared to 5 years ago...

3 ( +3 / -0 )

All he has to do is tell his fellow Nippon Kaigi member who happens to be the president of Labour Unions to ask his membership to go on strike? Comical I know. What would the workers do with a day off. But that's how ridiculous this situation is.

3 ( +3 / -0 )

North Korea has nothing to do with the impressive victory of LDP Komeito combine in the recent election . It is the charismatic personality and policies of PM Abe which has led to the great victory in the lower house election.

-4 ( +0 / -4 )

"Abe also said the government will take "all possible measures" such as taxation and regulatory reform to lay the groundwork for companies to spend their record profits more on wages and capital investment."

Yeah, "all possible measures" save anything that requires laws or enforcement of them, or taking away the cuts in taxes that GAVE the companies the windfalls they were supposed to use in part to increase wages but haven't. In doing this "for the fifth year in a row" he's admitting the last four times have failed. Nothing will come of this, either, save major companies MIGHT give 1000 yen more a year, and in return expect the 100-hour overtime cap per month to be ignored.

4 ( +4 / -0 )

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