Japanese Corporations to Raise Wages As Per Abe Request

Major Japanese companies notified their labor unions Wednesday that they will raise their pay scales to conclude this year’s spring wage talks, as requested by Prime Minister Shinzo Abe, who is eager to boost the economy squeezed by last April’s consumption tax hike.

Attention will now focus on whether wages for other workers, such as those at smaller firms and in regional areas, will also be increased, given criticism that the “Abenomics” policy mix has benefited only employees of big exporters in large cities.

Toyota Motor Corp. and Honda Motor Co. will offer their biggest pay hikes ever, raising average monthly pay scales by 4,000 yen and 3,400 yen, respectively. Nissan Motor Co. will increase its wage scale by 5,000 yen, the biggest rise among manufacturers.

Six major electronics companies including Hitachi Ltd., Mitsubishi Electric Corp., Panasonic Corp., and Toshiba Corp. have decided to raise their wage scales by 3,000 yen per month, the highest hike on record.

The management of these export-oriented manufacturers failed to fully meet labor unions’ calls at this year’s “shunto” spring labor offensive.

But it will be their second straight annual rise in pay scales, with their business performances improving on the back of the yen’s sharp depreciation under Abenomics, centering on the Bank of Japan’s aggressive monetary easing.

via Mainichi

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza