American workers aren’t the only ones wondering when they’ll finally be getting a raise. In Japan, companies benefiting from the weak yen are enjoying record profits, but they’re still reluctant to agree to significant wage increases for their workers. In a survey of expected 2015 salary increases in 17 Asian countries, Japan comes in second-to-last, according to human resources consulting company ECA International. Only Macau, the Chinese gambling enclave hit by high inflation, will do worse.
Even what appears to be good news turns out to leave households struggling. Last week, the Japanese government announced average monthly wages increased 0.5 percent in September. While that was the best performance in more than six years, workers shouldn’t get too excited. After adjusting for price increases, total cash earnings (including bonuses and overtime payments) fell for the 15th consecutive month, dropping 2.9 percent.
Until recently, Japanese workers could at least rely on deflation to provide a boost to their earnings. But with the yen falling, taxes rising, and the Bank of Japan starting a new round of stimulus, that’s no longer the case. “With deflation going on, actually people were much better off than they were in previous years,” Lee Quane, ECA regional director for Asia, told Bloomberg TV on Monday. Now, however, “because of the impact of the consumption tax increases and other inflationary impacts, actually workers aren’t going to be very well off in 2015 vs. this year.”
via Chinese Workers Get Nice Raises but Japanese Get Stiffed – Businessweek.
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