Fumio Kishida, the prime minister of Japan, has vowed to make the wave of wage increases durable and broad-based to cushion the inflation that is affecting Japanese people.
Pay increases provide the impetus for the economy, according to Kishida. We must disseminate the large wave of pay increases to the regions and small and medium-sized firms in order to make it sustainable.
During the biennial convention of the Japanese confederation of labour unions, Rengo, which mostly represents full-time salaried workers whose salary increases have not kept pace with inflation, Kishida made this statement. Contrarily, even from a low base, pay for contract and part-time workers have increased more quickly.
According to the government’s most recent household survey, the main breadwinners of households are feeling the strain of economic inflation, with real incomes down 2% since Kishida became Prime Minister two years ago.
According to the Straits Times, the Bank of Japan is also closely observing pay patterns as a crucial indicator of whether inflation will achieve its target level in a sustained manner.
The administration of Kishida published a preliminary plan for fiscal 2023’s economic and monetary policies earlier this year.
The roadmap emphasised the government’s goal of achieving economic development supported by wealth distribution and pay raises at a time when an increasing number of businesses are raising wages to keep up with the rate of inflation.
The outline plan also asks for greater investment in human resource development and labour market reform to help businesses offer better compensation.
