Although historic pay increases were achieved in this year's "shunto" spring wage negotiations in the country, wage growth remained slower than inflation.
Earlier this month, the government set a goal of achieving real wage growth of some 1 % annually in the five years through fiscal 2029.
While the pace of decline in real wages slowed from a fall of 2.2 % in fiscal 2023, price hikes for food items such as rice and daily necessities have put pressure on households.
It is uncertain whether the government will be able to achieve the goal, also reflecting persistent uncertainty surrounding the global economy due to the high tariff policy of US President Donald Trump.
In fiscal 2024, nominal monthly wages per worker, including base salary and overtime, rose 3.0 % to 349,388 yen on average, up for the fourth successive year and marking the steepest increase in 33 years, thanks to the results of the shunto wage talks and higher minimum wages.
Still, the county's real wages failed to outpace inflation as the consumer price index, excluding imputed rent, used to calculate real wages, grew 3.5 %.
Meanwhile, a real wage index calculated for international comparison using the overall CPI, which includes imputed rent, was unchanged from the previous year, coming out of negative territory for the first time in three years.
[Copyright The Jiji Press, Ltd.]
Photo by Reuters