Japan Data

Seasonal Cheer: More Than a Third of Japanese Companies to Raise Summer Bonuses

Economy Work Society

A growing number of Japanese companies are planning to offer larger summer bonuses, with many citing an improved business environment and growing financial strain on employees from inflation.

Employees at many Japanese companies have something extra to celebrate this summer. A survey conducted by Teikoku Databank on summer bonuses at companies across Japan found that among the 1,095 firms that responded, 37.4% planned to increase summer bonus payments. By comparison, 36.4% of firms did not intend to adjust bonus amounts and 9.3% said they will decrease bonuses. Companies paying bonuses made up 83.1% of firms surveyed compared to 11.2% that do not pay bonuses to their employees.

Situation for Summer Bonuses

Large companies led the trend in boosting bonuses at 42.3%, followed by 36.5% of small and medium-sized companies. Only 27.3% of small businesses plan to raise bonuses, which is 10.1 percentage points lower than the national average.

By industry, 41.0% of manufacturing firms planned to increase bonuses. A total of 52.2% of companies in the steel, nonferrous metals, and mining sector and around 40% of firms in the wholesale and real-estate sectors answered that they would increase bonuses.

Companies Increasing Bonuses by Size and Sector

As for the reason for raising bonuses, many companies pointed to improved business performance with the waning of the COVID-19 pandemic measures. Other factors cited were the desire to maintain employee motivation amid a tight labor market and to reduce the financial burden on employees as ongoing inflation drives up prices of consumer goods.

(Translated from Japanese. Banner photo © Pixta.)

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