Daiwa Securities Group Inc. plans to raise salaries for about 5,000 junior staff to offset swelling costs as the government prepares to increase the consumption tax.
Japan’s second-largest brokerage is considering increasing monthly pay by about 3 percent, targeting employees in their 20s and 30s, spokeswoman Misato Kinoshita said Tuesday.
A pay hike of around ¥5,000 to ¥10,000 per employee is likely, officials at the securities firm said.
Daiwa, which has about 14,000 employees, paid a starting salary of ¥210,000 a month to college graduates who joined the firm last April.
The move comes as the brokerage enjoys favorable earnings amid the stock market boom. Its group net profit grew more than ninefold in the first half through September 2013 from a year earlier to a record ¥92.83 billion.
Daiwa is following larger rival Nomura Holdings Inc. in boosting pay as Prime Minister Shinzo Abe urges companies to help defeat deflation and sustain the economic recovery. Consumer spending power will erode unless incomes climb to make up for rising consumer prices and the 3 percentage-point increase in the consumption tax in April.
Nomura said in November it will raise pay for about 4,000 employees by an average 2 percent starting in April.
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