Uniqlo owner gives Japan Inc a jolt with 40% wage hike
Uniqlo parent Fast Retailing Co Ltd said on Wednesday it would raise wages by as much as 40%, in the clearest sign yet that Japan’s rock-bottom salaries may be starting to budge after decades of deflation and cost-cutting.
The move by the casual clothing giant may serve as a wake-up call for Japan Inc, ahead of annual spring labor negotiations.
Here are reactions to the news and businesses’ wage outlook:
OSHADHI KUMARSASIRI, ANALYST AT LIGHTSTREAM RESEARCH, IN A NOTE ON THE SMARTKARMA PLATFORM
“We believe this probably down to inflation and Japan’s tight labor market.
“In addition, the company’s aggressive expansion plans in markets such as the U.S. and Europe, would mean that they will need to deploy some of the trained senior staff from Japan into those markets.”
JONATHAN NEWTON, PROFESSOR AT KYOTO UNIVERSITY INSTITUTE OF ECONOMIC RESEARCH
“Given the tightness in the labor market, I expect others to follow suit, maybe to a lesser extent, if they derive more of their revenue from domestic markets.
“If companies expect other companies to increase wages, they will be more inclined to raise wages themselves or risk being left behind, particularly in the contest to attract young talent.”
HIROKAZU MATSUNO, JAPAN’S CHIEF CABINET SECRETARY
“Although we would like to refrain from commenting on the efforts of individual companies … we welcome reports of companies that have announced aggressive wage hike policies.
“Wage increases should be determined through negotiations between labor and management on an individual basis, taking into consideration each company’s ability to pay, but we would like to see maximum wage increases in this context.
“We believe that the best way to address the current increase of prices is to realize continuous wage increases.
“The government will support such efforts through price pass-on measures and support for companies in the form of comprehensive economic measures.”
TOSHIHIRO MIBE, HONDA CEO, AT JAN 5 NEW YEAR EVENT
“(Business) growth must be taken into account to decide wage hikes. But we’d like to tackle wage hikes aggressively. Not by which comes first. Not in the chicken or the egg first situation.”
TAKESHI NIINAMI, SUNTORY HOLDINGS CEO, AT JAN 5 NEW YEAR EVENT, MEDIA INTERVIEW
“(We’re) prepared to raise wages more than 6%.
“It’s now necessary to go over the business management plan with the premise that inflation will continue in the future. Unlike in the past, wage increases are now inevitable and have become an important factor for the survival of companies.” (Reporting by Tokyo bureau; Editing by Bradley Perrett and Clarence Fernandez)
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