TOKYO (Reuters) – The average pay rise proposed by 231 Japanese companies this year for full-time and part-time employees is the largest since 2013, the country’s largest industrial union said on Thursday.
The announcement comes a day after major Japanese manufacturers, led by Toyota Motor and including Panasonic, Nippon Steel and Nissan, agreed to fully meet union demands for higher wages in this year’s wage negotiations.
UA Zensen, an organization established in 2012 that represents 2,237 unions and 1.8 million service, textile and retail workers, announced a weighted average wage increase of 5.9% in 2024 for full-time and an increase of 6.5% for those working part-time during negotiations which ended on Wednesday.
Strong wage growth should fuel sustainable and stable inflation, a prerequisite for the end of the Bank of Japan’s (BoJ) negative interest rates, which have been in place since 2016.
Speculation is growing that the Japanese central bank could end negative rates at its March 18-19 policy meeting next week.
UA Zensen workers have demanded a total salary increase of 6%, two-thirds of which will be in the form of base salary increases, which would raise salary curves and serve as a basis for salary increases, bonuses retirement and payment of compensation.
By 2023, Japanese companies had given workers the biggest pay increases in 30 years, while average wages had stagnated since the bursting of the speculative bubble in the early 1990s.
(Reporting by Tetsushi Kajimoto, with contributions from Kentaro Sugiyama; Diana Mandiá, editing by Kate Entringer)
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