Japan plans to draw up a five-year plan to promote wage hikes for small and midsize companies, which account for 70% of employment in the country, sources said Tuesday.

The government will call on the public and private sectors to spend about ¥60 trillion in total over the five years to fiscal 2029 to improve the productivity of such firms, informed sources said.

The plan will be presented at a meeting of the government's Council of New Form of Capitalism Realization, chaired by Prime Minister Shigeru Ishiba, to be held as early as later this week, and will be included in an implementation plan to be compiled in June, according to the sources.

The Ishiba administration has set a target of raising the country's average minimum hourly wage to ¥1,500 by the end of the 2020s.

During the five years, the government will work intensively on raising labor productivity, or added value created per person, in 12 industries, including the restaurant and accommodation sectors where labor shortages are serious, by promoting labor-saving and digitalization investment. The 12 industries also include retail, manufacturing, nursing care and welfare, agriculture, forestry and fisheries industries as well as the sector covering hairdressing, beauty, cleaning and other lifestyle-related services.

A labor-saving investment promotion plan tailored to each industry will be formulated.

The government will aim to increase the labor productivity of the restaurant sector, which employs about 4 million people, by 35% over the five years. An action plan will be drawn up based on good examples such as those involving the use of self-checkout terminals and serving robots.

The government also hopes to promote labor-saving measures such as the introduction of self-check-in machines in the accommodation industry, which will aim to improve productivity by 35% as well.