62% Of Japan Firms Raise Base Pay Of Workers This Year

A total of 62.1% of Japanese companies have raised or plan to raise base pay in fiscal 2023, up sharply from 38.7 percent the previous year as they seek to secure talent and match rising prices, a Finance Ministry survey showed, Kyodo News reported.

Photo Insert: Companies are seeking "to enhance the motivation of the employees, improve their labor conditions and prevent them from leaving jobs."

The trend was notable particularly in the nonmanufacturing sector, with 56% saying they have or will raise wages, expanding from 28.8% the year before, the survey said. In the manufacturing sector, the figure was at 69.8%, up from 52%.

Hikes of 3% or more were recorded for 37.3% of the businesses that have raised base pay or plan to, up from 13.7% the previous year, Mainichi Shimbun also reported.

When asked the reasons for raising wages, including base pay and bonuses, 80.4 percent said they seek "to enhance the motivation of the employees, improve their labor conditions and prevent them from leaving jobs."

Some 64 percent said they did so "to respond to rises in commodity prices."

Among the respondents, a medium-sized retailer in western Japan, said "at a time less people are seeking to work in sales and customer services, we cannot acquire talent unless we improve labor conditions."

The survey targeted around 1,200 companies, comprising some 500 large-sized companies and 700 small- and medium-sized firms, from mid-March to mid-April.

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