FALLING WAGES IN JAPAN RAISE FEAR OF DEPRESSING EFFECT ON ECONOMY
By Michiyo Nakamoto in Tokyo 2009-08-04
Wages in Japan have suffered their sharpest drop since tracking began almost two decades ago, fuelling concerns that the economy will remain under pressure from depressed consumer spending.
The plunge comes as Japan prepares to vote at the end of the month in elections that could topple the long-serving Liberal Democratic party, with both the incumbents and the rival Democratic Party of Japan, which is leading in the polls, wooing voters with promises of better conditions for workers.
Labour Ministry figures showed monthly wages, including overtime pay and bonuses, slid 7.1 per cent from a year earlier in June to Y430,620 ($4,518), the 13th consecutive decline but the biggest since the data series started in 1990.
The steep June decline stemmed in large part from deep cuts to bonuses as manufacturers in particular continued to suffer from weak demand. Bonuses, which are generally distributed in June and December, suffered a 14.5 per cent fall from a year ago. “This kind of drop in bonuses would be unthinkable in normal times,” said Naoki Murakami, chief economist at Monex Securities.
Overtime hours worked continued to fall by double digits, declining 40 per cent year-on-year in the manufacturing sector. Overtime pay fell 17.7 per cent in June from a year earlier.
Demand has been partly offset by government stimulus measures. Mr Murakami said that incentives to buy fuel-efficient vehicles and energy efficient electronic products have had a stronger impact on consumption than many economists had expected.
The LDP's policy manifesto pledges to create 2m jobs over the next three years and increase household after-tax income by Y1m within 10 years. The DPJ, meanwhile, is proposing an increase in the minimum wage to Y1,000 from about Y700 an hour.
6月份工资急剧下跌的主要原因在于，日本企业（特别是制造商）继续受困于需求疲软，大幅削减了奖金水平。日本的奖金一般在6月和12月发放，此次发 放的奖金比一年前减少了14.5%。“在正常时期，奖金出现这样的下降是不可想象的，”日本Monex证券首席经济学家村上直树(Naoki Murakami)说。