Toyota labor group to slash wage-hike demand in further threat to Japan’s inflation target


The umbrella labor group representing Toyota Motor Corp. and its related companies said it will seek half the minimum wage increase in 2016 compared with its plan entering the fiscal year.

The Federation of All Toyota Worker’s Unions, which represents Toyota Motor and subsidiaries including Denso Corp., said its members intend to request a raise of ¥3,000 or more in monthly base pay, according to Chairman Tatsuya Sasaki at a briefing in Tokyo Friday. Last year, the group said it would demand gains of at least ¥6,000.

“The figure is decided based on a comprehensive judgment of the macro economy and earnings situations at different companies,” Sasaki told reporters. “Different companies have different situations. Some companies haven’t benefited from the weak yen at all.”

The dialing back of pay ambitions by Japan’s labor unions risks setting back government efforts to reflate the economy after the nation entered its second recession since Prime Minister Shinzo Abe took office in 2012.

Bank of Japan Gov. Haruhiko Kuroda and Abe’s government have emphasized the need for higher salaries to play a role in spurring a revival from the seventh recession in about 20 years.

The Toyota group’s demands are in line with those of the broader Japan Council of Metalworkers’ Unions, which said last month its members will seek the ¥3,000 or more raise in monthly base pay.

Sasaki said that the wage demand is a target or reference for member unions and there may be different demands by the individual groups given the gap between the profits earned by Toyota Motor and the smaller group companies.