Japan Secures Largest Wage Hike in Over Three Decades

Major Japanese companies agree to a 5.46% average pay increase, addressing inflation and labor shortages, though smaller firms face challenges.

Japanese labor unions achieved an average wage increase of 5.46%, the highest in 34 years, according to preliminary data from Rengo, the nation's largest union federation.
The wage hike comes as companies aim to address rising living costs driven by inflation, which hit 4% in January, the highest in two years.
Record corporate profits, fueled by a weak yen, and labor shortages have enabled large companies like Hitachi to meet union demands for substantial pay raises.
Smaller firms continue to lag behind larger corporations in wage increases, with ongoing negotiations expected to address this disparity in the coming months.
Prime Minister Shigeru Ishiba has called for measures to support higher wages, including helping smaller businesses pass on increased costs to customers.