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Japan August real wages fall as rising gasoline prices threaten consumption
[TOKYO] Japanese workers' inflation-adjusted real wages fell in August for the first time in four months in a setback to hopes that consumer spending will accelerate and support economic growth.
The 0.6 per cent decline in real wages in August from a year earlier followed a revised 0.5 per cent annual increase in July, labour ministry data showed on Friday.
Summer bonuses boosted real wages in June, but since then real wages have been losing momentum as consumer prices have crept higher due to rising gasoline and kerosene costs. The decline in real wages suggests consumers may start cutting back on other spending so they can more easily pay to fuel their cars and heat their homes.
Nominal cash earnings rose 0.9 per cent year-on-year in August, slower than a revised 1.6 per cent annual increase in July. Regular pay, which accounts for the bulk of monthly wages, grew 1.3 per cent in August from a year earlier. Special one-off payments, which include summer bonuses, fell an annual 7.4 per cent in August after a revised 2.8 per cent annual increase in the previous month.
Overtime pay, a barometer of strength in corporate activity, rose 1.0 per cent year-on-year versus an annual 1.6 per cent increase in July. Major Japanese firms typically pay bonuses twice a year, once during the summer and once near year's end.