A group of Japanese companies have agreed to increase wages by 5.24% this year, according to Rengo, the country’s largest union group. This is the third announcement regarding the annual pay negotiations. The initial outcome was 5.28%, followed by a second survey result of 5.25%, making it the biggest wage increase since 1991 when it reached 5.66%.
The announcement of the pay talks’ outcomes comes in stages, beginning with major companies in mid-March. Typically, the average increase in wages tends to decrease as smaller companies conclude negotiations during the April-June quarter. The next survey result is set to be released on April 18.
Prime Minister Fumio Kishida sees high wage growth as essential for lifting Japan out of over two decades of deflation. Similarly, Bank of Japan Governor Kazuo Ueda emphasizes the importance of sustained wage growth and inflation to gradually reduce the need for significant monetary stimulus measures.
Source: Reuters