|Shinzo Abe, Japan's prime minister, at a press conference in Tokyo, Monday March 10, 2014, in advance of today's third anniversary of the devastating earthquake and tsunami when almost 19,000 people lost their lives.|
Japan’s six major electronics makers, including Hitachi Ltd. and Panasonic, have agreed to raise their wage
levels by ¥2,000 (€14) per month, the
highest hike on record, according to the Kyodo news agency on
The move is likely to affect other industries as well, before the start of the new fiscal year
on April 1st.
Kyodo said NEC and Fujitsu Ltd. were originally reluctant to accept the
agreed amount amount and wanted to limit the pay hike to ¥1,500, but they decided to follow
other the companies.
The companies, which include Toshiba and Mitsubishi Electric, will
announce their final decisions Wednesday.
The trade unions at the companies originally made a unified demand to raise
basic pay scales by ¥4,000 and said they would strike if the managements do not
hike pay by at least ¥2,000.
Companies responded to calls by the government to raise wages to pull Japan out of
deflation and soften the impact of the 3% consumption tax hike to take effect on April 1st.
The workers’ union at Toyota has requested an increase in monthly pay of 1.15%
or about ¥4,000, while unions at Nissan Motor Co. and Honda Motor Co. have
called for a base pay increase of ¥3,500 yen, a 0.96% increase.
Bloomberg reported this month that Japan’s salaries increased for the first
time in almost two years in January as companies boosted pay for part-timers,
aiding Prime Minister Shinzo Abe’s effort to end 15 years of deflation.
Base pay excluding bonuses and overtime rose 0.1% from a year earlier,
the first gain in 22 months, the labor ministry said in Tokyo. Overall pay fell
0.2%, the first drop in three months.
Base wages for full-time workers, who comprise almost 71% of Japan’s
working population, were unchanged, while those of part-time workers climbed 1.1%.
Japan’s consumer prices rose just 0.4% in 2013 but excluding energy
and food prices, the index fell 0.2% compared with 2012.
The Bank of Japan’s target is a 2% inflation rate by next year and
since early last year it has been aggressively pumping money into the economy.
Government data on Monday showed that the overall economy grew just 0.7% on
an annualised basis in the final three months of 2013, a downward revision from
the initially projected 1% growth rate. Business investment grew by an
annualised 3% in the fourth quarter, compared with a preliminary reading of a
5.3% increase. Consumer spending was up an annualised 1.6%.
While the world's number-three economy grew 0.2%
in the quarter to December, growth was 1.5% through 2013.
The current account, which is based on net receipts from trade and investment
with the rest of the world, posted an overall deficit of ¥1.59tn ($15.4bn) for
Without a rise in wages to promote consumer spending, the 'Abenomics' policy of
the prime minister to slay deflation will not succeed.
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