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Wages are facing strong upward pressure because of the heating labor market. Wage increases will feed into prices, getting the economy on the path for sustainable inflation.

9 Comments

Junichi Makino, chief economist at SMBC Nikko Securities Inc in Tokyo (Bloomberg)

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Anyone here getting a raise or know anyone getting a raise. Is there a minimum wage hike proposed? Nope!

1 ( +3 / -2 )

Any "heating up" of the labor market due to a shortage of workers is quenched by the declining population, which is is providing fewer and customers, meaning there is less demand for thw the things workers are producing. Since domestic consumption makes up more than 60% of what Japanese companies produce, and exports face stronger competition from other parts of Asia, there really is little reason to expect wages to increase. The upcoming increase in the consumption tax will further drive down consumption, revenue, and wages.

-1 ( +2 / -3 )

Raises? The company I work for instituted an across-the-board freeze on raisess and lowered the base starting salaries for all incoming recruits by 4%.

Not all industries are seeing this wage increase Mr. Makino speaks of.

0 ( +2 / -2 )

If you're in the eikaiwa industry, forget it. The entire industry relies on high staff turnover of short term working holiday visa contracts in order to survive. The less newcomers know about what's really going on, the better! They all know this.

-1 ( +1 / -2 )

At least we won't be getting a pay cut this year, which is something to be thankful for. I see that electronics companies and some car makers have agreed a Y2000 - Y3000 a month increase in base salaries. However, if the average salary before extras is about Y300000 per month that's only a 1% rise, or less. When prices increase by 3% next month most workers will be worse off.

-1 ( +0 / -1 )

Actually, sighclops, I have a friend working at gaba. His is an "itaku" contract, which means he gets paid for however much work he does. His company pays 5% tax for his services, so from April he will receive an extra 3%. For him, that's over 10,000 yen a month.

0 ( +2 / -2 )

Makino-san be smoking some of de good stuff,,, "wage increases" hahahahaha

0 ( +2 / -2 )

Everyone at my company got a 5 to 10 percent raise in January.

1 ( +1 / -0 )

Sure, you let me know when that "heating up" translates into the 'real world' here in Japan. The only things I see going up are my utility bills, taxes, food, petrol... wages increasing, I WISH!!!

0 ( +0 / -0 )

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