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Japan summer bonuses fall the most since global financial crisis
[TOKYO] Japanese summer bonuses fell the most since the global financial crisis even as monthly pay rose for a third straight month in September, government data showed on Monday, underlining concerns about tepid wages and private consumption.
Real wages, adjusted for inflation, rose 0.5 per cent year-on-year in September, up three months in a row, as nominal wages outpaced tame inflation, the labour ministry data showed.
Policymakers are putting pressure on Japanese firms to use their record cash piles to boost wages and capital expenditure in a bid to generate private sector-led growth and accelerate inflation to the central bank's ambitious 2 per cent target.
Summer bonuses paid during the June-August period came to 356,791 yen (S$4,120) on average, down 2.8 per cent from the same period last year, the biggest drop since 2009.
Labour ministry officials attributed the decline in summer bonuses to the change in data sampling adopted in January, the retirement of well-paid elder workers, and a rise in part-timers who now account for 30 per cent of wage earners.
"Wages are increasing moderately as a trend due to the tight labour market," said a ministry official.
Total cash earnings rose 0.6 per cent year-on-year in September to 265,527 yen, up for three straight months.
Many companies, particularly small firms, have been hesitant to boost wages as they want to avoid marked increases in fixed labour costs.
Regular pay, which determines base salaries, rose an annual 0.4 per cent, up for the seventh straight month.
Overtime pay, a barometer of strength in corporate activity, rose an annual 1.4 per cent.