Loading

Search

:

Japanese Companies Tighten Belts, Declining To Offer Base Pay Hikes

  • Category:Other

TOKYO - Against the backdrop of the coronavirus epidemic and a looming global economic slowdown, major Japanese firms tightened their belts in influential annual wage deals hammered out with unions on Wednesday.

Setting the tone, bellwether Toyota Motor Corp said it had agreed to give workers an average monthly pay raise that's 20% lower than last year's hike. What's more, base pay will not rise for the first time in seven years.

Major steelmakers followed suit and did not raise base pay, threatening Prime Minister Shinzo Abe's lofty goal of generating a self-sustaining growth cycle - a key plank of his Abenomics policies to stimulate the world's third-biggest economy.

Over the past six years, major firms raised wages more than 2% each spring as Abe pressured businesses to boost pay to put an end to deflation and stagnation that has dogged Japan for two decades.

BOJ Governor Haruhiko Kuroda has said he would closely watch the outcome of the wage talks for clues on the inflation trend, amid speculation the central bank may expand stimulus next week to mitigate the economic damage from the coronavirus.

"Substantial wage increases cannot be expected in 2020 as base pay won't rise much," said Yoshiyuki Suimon, senior economist at Nomura Securities. He was referring to base pay hikes, which determine regular pay that accounts for most of monthly salary.

NO BASE PAY HIKE

Rather then lifting base pay, Toyota agreed to an average rise of 8,600 yen per month for all employees.

The increase in the fiscal year starting in April compared with last year's 10,700 yen raise.

"Any negative impact to our current situation could have a significant impact on our workforce,” Masanori Kuwata, Toyota's deputy chief human resources officer, told reporters after reaching the agreement with its union.

"Because of this, we opted to forgo raising base salaries this year," Kuwata said, adding that Toyota's base salaries are already among the highest in the country.

Japanese major steelmakers - Nippon Steel, JFE Steel, a unit of JFE Holdings and Kobe Steel Ltd said they agreed with unions that there would be no base wage increases for two years, the Nikkei business daily said. It would be the first time in seven years that these firms have not hiked base wages.

"Companies are turning cautious about base pay hikes as the new virus outbreak will exacerbate declines in profits," said Koya Miyamae, a senior economist at SMBC Nikko Securities.

"As the virus outbreak deepens, labor unions are also losing momentum towards base pay hikes, and both manufacturers and non-manufacturers become half-hearted about wage hikes."


FIXED COSTS

With the economy teetering on the brink of a recession, Japanese firms have begun to take a more varied approach on remuneration, with more eschewing blanket pay hikes and shifting to merit-based wages rather than seniority-oriented pay in an effort to attract young and skilled workers.
Wage strategies have also been affected by structural changes in Japan's labor market.

About 40% of workers are now lower-paid part-time staff and contract workers - double the proportion seen in 1990, just before the Japan's asset bubble burst.

The growing army of lower-paid workers has led unions to prioritize addressing the income gap between permanent employees and others, rather than broad uniform pay raises.



© Thomson Reuters 2020.
 
 

Comment(s) Write comment

This concept of trisomic chromosome loss has been similarly observed in human trisomic cell cultures obtained and reprogrammed into iPSC from the fibroblasts of patients with Down syndrome. <a href=https://tamoxifenolvadex.com/>nolvadex vs arimidex bodybuilding</a>
Unfortunately, there are also studies that contradict those results. <a href=https://clomida.com/>buy clomiphene and gonadotropins</a>
The early warning signs of OHSS are abdominal pain and distention, nausea, vomiting, diarrhea, and weight gain. <a href=https://clomida.com/>how long does clomid stay in your system</a>
<a href=https://cheapcialiss.com/>buy cialis uk</a> Vardenafil has been proven effective in men with ED, including those above the age of 65, which account for the most prevalent age group with erectile dysfunction
Some Information About Cialis <a href=https://cheapcialiss.com/>buy cialis online 20mg</a> It was said before that Liu Yeguan would stick to it for half a month, but now it which otc male sexual enhancement pills contain viagra cialis seems that one is not good
You ll usually be prescribed this dose if you have persistent, severe ED that doesn t improve with the 10mg dose of Levitra <a href=https://vtopcial.com/>is there a generic cialis available</a> What should I do if the hyperhidrosis treatment isn t working
The 31-year-old man bought a bottle of IronMag liquid sildenafil citrate, which was marked for research use, online and without a prescription, the doctors reported in Retinal Cases and Brief Reports <a href=http://vtopcial.com/>buy cialis 5mg</a>
All seven of these products offer potent, all-natural components that will target your issue and help rejuvenate your sex life <a href=https://buypriligyo.com/>dapoxetine priligy</a>
You will not be as likely to find a better alternative product that costs the same, but will hopefully offer better benefits in addition to the online Cialis <a href=http://buypriligyo.com/>priligy amazon canada</a> Men who have erectile dysfunction can receive erectile dysfunction treatment online to help them get and sustain erections, allowing them to once again participate in healthy sexual relationships
Focusing more on foreplay and less on penetration can help you last longer for several reasons <a href=http://cialisfstdelvri.com/>cheapest cialis</a>
Generally speaking, Sildenafil is safe for long-term use <a href=http://cialisfstdelvri.com/>purchase cialis online</a>
Power is the amount of work done in sec. <a href=http://iverstromectol.com/>stromectol for head lice</a> Cialis 30 Anni
    Enhammela
  • August 20, 2022
sildenafil 100mg price walmart <a href="https://viagrahom.com/">canadian pharmacy viagra 50 mg</a> sildenafil online
cialis viagra <a href=" https://viagracnd.com/# ">viagra premature ejaculation treatment</a> - viagra no prescription paypal
https://viagracnd.online# i want to try viagra
viagra discount btfheic [url=https://viagracnd.online#]viagra montreal online rbwgsdp[/url] viagra side effects for young men
    Brianfaf
  • August 7, 2021

Trackback (You need to login.)