Japan's Real Wages Fall 1.8% in January After 3 Months of Growth
Real wages of Japanese workers decreased by 1.8% compared to the same month last year, marking a negative growth for the first time in three months.
According to the "January Labor Statistics Survey (preliminary figures)" announced by the Japanese Ministry of Health, Labour and Welfare on the 10th, the average nominal wage per person at companies with five or more employees was 295,505 yen (approximately 2,906,055 won) per month, an increase of 2.8% compared to the same month last year.
However, real wages adjusted for price changes decreased by 1.8% compared to the same month last year. This marks a return to a downward trend after three months. This is because the consumer price index rose by 4.7%, surpassing the nominal wage increase.
Japan's real wages had been declining consecutively for 26 months from April 2022 to May last year, after which they fluctuated. However, months showing an increase were limited to June, July, November, and December, coinciding with bonus payment periods.
The Nihon Keizai Shimbun (Nikkei) reported that with the real wage growth rate declining again, attention is focused on the results of the Chuntu (spring wage negotiations). The key issue this year is whether the wage increase trend will spread not only to large corporations but also to small and medium-sized enterprises during Chuntu.
A Ministry of Health, Labour and Welfare official told Kyodo News, "Until the March wages, which are before the impact of Chuntu, if high inflation does not stabilize, the negative trend in real wages is expected to continue."
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Earlier, the Yomiuri Shimbun and Nikkei reported that the Japanese Trade Union Confederation, Rengo (連合), Japan's largest labor union, aggregated the wage increase rates demanded by its affiliated unions for this year's Chuntu, which averaged 6.09% as of the 3rd. Last year's average wage increase rate for Rengo-affiliated unions during Chuntu was 5.1%.
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