Pandemic still impeding wage hikes in Japan

A Japanese labor ministry survey shows that the coronavirus pandemic continues to curb wage increases for workers in the worst-affected sectors.

Among companies that responded, 80.7 percent said they had raised, or were planning to raise, base wages or seniority-linked pay this year. That is down 0.8 points from last year, marking the second consecutive year of decline. It compares with more than 90 percent in 2019, before the pandemic.

The survey of about 1,700 firms was conducted in July and August, targeting businesses with at least 100 employees.

Pay hikes were most common in the research and technical services sector, including consultancies, with nearly 94 percent of firms responding positively.

The real estate and the goods rental sectors followed at more than 93 percent. Among manufacturers, almost 91 percent offered or planned to offer wage increases.

Higher pay was least likely at firms engaged in accommodation and restaurant services at 56 percent.
The rate among companies in transport services including buses and taxi firms and delivery services was 64 percent.

Labor ministry officials are keeping an eye on the pay gaps and whether increases will spread to other sectors.