A survey shows that this year's momentum for pay raises is spreading among small and medium-sized businesses in Japan.
According to a survey by the Bank of Japan released on Friday, the momentum for pay raises this year is spreading among small and medium-sized businesses in Japan, reflecting efforts to address labor shortages and inflation pressures by the government.
According to the Bank of Japan's survey of regional small and medium-sized businesses, labor shortages are now seen as a continuing phenomenon, and the need for continued pay raises has been widely recognized.
Despite the fact that many companies are still struggling to pass on the continuously rising labor costs to prices, more and more actions to raise prices are being implemented or considered, especially in industries with severe labor shortages.
The momentum for wage increases in small and medium-sized enterprises may create conditions for the Bank of Japan to raise interest rates again. Wage growth in small and medium-sized businesses usually lags behind that of large corporations.
Rengo, Japan's largest labor union, said that monthly salaries for employees in the current business year would rise by an average of 5.10%, the largest increase in 30 years.
Rengo, which has approximately 7 million members, said that large companies would increase salaries by 5.19%, while small companies would have a smaller increase of 4.45%.