TOYOTA Motor has agreed to fully meet its union’s request for annual pay increases, the Mainichi newspaper said on Wednesday (Mar 13), as top Japanese companies look likely to offer sizeable salary hikes at annual talks with unions.
The wage negotiations, which wrap on Wednesday have long been a feature of Japanese business, where relations between unions and management tend to be far more collaborative than in other countries.
This year the talks are being closely watched as bumper pay increases are expected to help clear the way for the central bank to end its years-long policy of negative interest rates as early as next week.
Toyota, the world’s biggest carmaker and traditionally a bellwether of the annual talks, agreed to meet worker demands, the Mainichi said. Toyota workers are asking for monthly pay increases of as much as 28,440 yen (S$257) and record bonus payments.
A Toyota spokesperson said the information was not something released by the company. Toyota is expected to update on the outcome of the talks later on Wednesday morning.
Economists see substantial wage increases as a prerequisite for the Bank of Japan to declare that its long-held goals of sustainable wage growth and stable prices are in sight and usher in an end to negative rates in place since 2016.
The bank, which has stuck with massive stimulus and ultra-low rates for years longer than other developed countries in an attempt to jumpstart a moribund economy, is set to hold its next policy setting meeting on Mar 18 to 19.
Workers at major firms have asked for annual increases of 5.85 per cent, topping the 5 per cent mark for the first time in 30 years, according to Japan’s biggest trade union grouping, Rengo. As a result, some analysts expect this year’s wage increases by 5 per cent or more, from just under 4 per cent previously. That would be the biggest increase in some 31 years.
Unions across industries, including automobiles, electronics, metals, heavy machinery and the service sector have all demanded hefty pay hikes. REUTERS
