Prime Minister Shinzo Abe asked business leaders Tuesday to raise wages in a rare move reflecting the administration’s resolve to accelerate the battle against chronic deflation.
The request was made during talks between the new prime minister and executives of powerful business lobbies, including Hiromasa Yonekura, chairman of Keidanren, which recently suggested at the start of the annual negotiations with labor unions that its member companies will freeze or delay regular wage hikes.
“I hope that companies with improved performances will make efforts to raise the pay” of their employees, Abe told the meeting, which included representatives from the Japan Association of Corporate Executives and the Japan Chamber of Commerce and Industry.
Yonekura later told reporters that an increase in salaries would depend on economic conditions. “Better business performances would be reflected in (higher) bonuses and lump sum payments,” he said.
JCCI Chairman Tadashi Okamura said “business confidence at the moment is very strong. We are likely to consider possible measures, including wage hikes.”
Abe, who took office in December, has underscored the need to channel recovering corporate profits into households in the form of salary increases, thereby boosting private consumption, while pressuring the Bank of Japan to ease monetary policy more aggressively to support business activity.
In an accord with the government, the BOJ has set a 2 percent inflation target, with experts warning the effects of monetary policy will take time to filter into incomes, and that inflation without pay raises would hurt the public.
Economic revival minister Akira Amari also attended the meeting with business leaders.
Earlier, Amari said Abe’s economic policy, which has come to be called “Abenomics,” has been welcomed by financial markets.
But the minister added that Abenomics can’t be considered sufficient if it doesn’t distribute “real” fruits to the public.
Toyota exec promoted
Toyota Motor Corp. will promote Vice Chairman Takeshi Uchiyamada as chairman to succeed Fujio Cho, sources said Tuesday.
Uchiyamada, 66, will assume the post after the company holds its shareholders’ meeting in June, the sources said. Cho, 76, will remain as a senior adviser.
Keidanren, the top business lobby, named Uchiyamada Tuesday as a vice chairman to succeed Katsuaki Watanabe, 70, a senior adviser at Toyota.