Japan Press Weekly

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2014 January 22 - 28 [LABOR]

Keidanren really accepts pay hikes?

Realization of a basic wage increase is reportedly the top issue in this year’s spring wage offensive. The Japan Business Federation (Nippon Keidanren) in a report released on January 15 by its committee on management and labor policy indicated an intention to accept pay hikes including a basic wage increase.

Keidanren in past reports repeatedly claimed that scheduled salary reviews should be “frozen” and that a basic pay raise is “out of question.” In this year’s report, it changed its position.

The report known as the “corporate basic policy for the annual spring wage talks” points out that in this year’s wage talks “corporations which deliver good business performance will consider using a part of increased profits not only for capital investment but also for creating more jobs and raising wages for their employees.” It states that the higher income will be provided through various means such as an increase in the amount of seasonal bonuses and the increase of wage levels of “specific” groups of workers.

What Keidanren indicates in this year’s report is pay hikes only for certain workers such as healthy companies’ so-called “specific” workers.

The report states that corporations increased their retained earnings and admits that the amount of corporations’ savings and cash on hand has “reached about 168 trillion yen.”

However, the report objects to the argument regarding the use of a portion of corporate internal reserves for wage hikes, stating that such action is “unrealistic”.

In the report, Keidanren sees the current situation as a “golden opportunity” to withdraw from the deflationary economy and move toward sustainable economic growth. If Keidanren really believes so, it should move to realize wage hikes for all workers without turning its back on the call for utilization of corporate internal reserves.

In the 2014 spring wage offensive, the National Confederation of Trade Unions (Zenroren) is working to win a monthly wage increase of 16,000 yen or more and an increase of over 120 yen in the hourly wage for all workers by pushing corporations to use their retained earnings. The Japanese Trade Union Confederation (Rengo) is seeking to raise the basic monthly wage by more than 1%.