Restoring industrial competitiveness is the key to fueling wage gains that the Abe government and the central bank are counting on to ensure inflation takes hold, according to labor minister Yasuhisa Shiozaki.
"We have to think about why wages haven't risen," Shiozaki said in an interview in Tokyo on Wednesday. "It's because we've lost industrial competitiveness. When you lose it, your profitability falls and you can't boost wages."
Shiozaki's comments show how difficult Prime Minister Shinzo Abe's task is in getting companies to increase salaries to help drive the world's third-biggest economy. Unprecedented monetary easing by the Bank of Japan has weakened the yen, boosting profits for many large exporters while increasing costs for smaller, domestically focused producers.