Japan Data

Spring Wage Hikes Top 5% at Japan’s Major Companies

Work Economy Lifestyle

Rengō “spring wage offensive” negotiations in 2024 resulted in an average wage rise of 5.28%, based on preliminary figures.

According to preliminary figures released by the Japanese Trade Union Confederation (Rengō), “spring wage offensive” negotiations at 771 companies where its unions are based, as of March 15, resulted in an average wage rise of 5.28%, a year-on-year rise of 1.48 percentage points. Compared with past finalized figures, this is the first rise of more than 5% since the 5.66% increase of 1991.

Rengō targeted at least a 3% increase in base salary and at least a 5% rise in overall wages. Nippon Steel greatly exceeded this figure with a 14.2% overall rise, while other major companies in industries like steel, automobiles, and machinery fully met labor demands.

On March 19, the Bank of Japan hiked interest rates, exiting its negative rate regime in response to signs that the Japanese economy had finally achieved sustainable inflation in consumer prices and wage hikes to match. While the central bank’s main lending rate still remains near zero, this change marks a ground shift in the conditions that have hampered wage hikes to date.

Annual Wage Increases

Looking only at the 358 small and medium-sized companies, the wage hike rate was lower, at 4.42%. The first round of negotiations will have an effect on later discussions, but there will be interest in how great this will be at other SMEs, which overall hire 70% of all employees.

(Translated from Japanese. Banner photo © Pixta.)

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