The government threatened Thursday to take the unprecedented step of shaming big companies that do not raise wages during the annual spring labor talks, despite calls by the nation’s inflation-stoking prime minister to boost pay.
The surprising threat to disclose companies’ names comes days after Akira Amari, state minister in charge of economic and fiscal policy, raised the stakes in the sensitive pay negotiations with an apparent threat to take action against “uncooperative” firms.
The usually low-key talks were being closely watched to see if cash-rich firms would put more money in workers’ pockets amid worries that wages aren’t keeping pace with the Bank of Japan’s bid to stoke 2 percent inflation, and that the sales tax hike on April 1 will put the brakes on growth.
The government “will react in some way” against firms that are “uncooperative with our policy of creating a virtuous economic cycle,” Amari told reporters on Tuesday, referring to the “Abenomics” strategy of Prime Minister Shinzo Abe.
Tabloid Nikkan Gendai compared Amari’s comments to the aggressive tactics used by the notorious yakuza.
Big companies account for a small fraction of the nation’s workforce.
On Thursday, trade minister Toshimitsu Motegi said his office would publish the outcome of the labor talks known as “shunto,” meaning “spring offensive,” and reveal which members of Japan Inc. heeded the wage-hike call issued by Abe.
“The ministry plans to conduct a survey on the leading 1,800 companies about this year’s shunto talks and disclose the results at latest by May,” Motegi, head of the ministry of economy, trade and industry, told a Diet committee.
Abe’s issued the appeals as part of attempt to kick-start the world’s third-largest economy, which has suffered from years of crippling deflation.
His risky growth blitz, dubbed Abenomics, is aimed at reversing falling prices through aggressive monetary easing, fiscal spending and vows of structural reform. Recent data suggest Tokyo is making headway in stoking that inflation, which would at least bring higher prices.
Consumers are also bracing for a sales tax rise to 8.0 percent next month, up from 5.0 percent. The move, the first stage in doubling the consumption tax, is seen as crucial to shrinking Japan’s massive national debt. But it is also expected to weigh on consumer spending and temporarily slow growth.
Wage rises — a rarity in a country beset by falling prices — are seen as one of the keys to making Abe’s plan to fire up the economy work.
Japan’s auto sector was a key target, with all eyes on Toyota, the world’s biggest automaker, which — along with other exporters — posted big profits on the back of a yen that has been sharply weakened since Abe swept to power in late 2012.
On Wednesday, Toyota said it would raise employees’ pay by an average of ¥2,700 a month and give them a bonus worth on average about 6.8 months of their base wage — a common pay structure in Japan.
Companies including Nissan, Panasonic, Hitachi and Toshiba also announced pay hikes.
The focus will now shift from blue-chip firms to see whether small and mid-sized companies — which employ the vast majority of Japan’s workers — follow the lead on pay.