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Summer bonuses at major firms fall for first time in five years

Kyodo

Summer bonuses at major companies fell 4.56 percent to ¥917,906 ($8,300) on average from last summer, posting the first drop in five years, the Japan Business Federation said in a preliminary report.

The business lobby, also known as Keidanren, attributed the drop to a strong yen last summer that negatively affected the revenues of export-reliant companies. Labor unions’ preferences for a hike in base pay rather than other compensation also affected the trend, it said Friday.

Though the drop is expected to dent consumer spending, the amount is the fourth-highest since comparable data became available in 1959, according to Keidanren.

Major companies “are keeping the ¥900,000 level for the third consecutive year, which is an extremely high level,” a Keidanren official said.

Major manufacturers settled on an average payment of ¥926,561, down 4.69 percent, and the agreed amount for nonmanufacturers is ¥638,119, down 0.12 percent.

Of 11 major industries, five, including food and steel, agreed to pay higher bonuses than last summer. Those that decided to trim the amount included the ship-building, automobile and electrical machinery industries.

The averages were based on responses received from 82 of the 252 major companies that have at least 500 employees and are listed on the first section of the Tokyo Stock Exchange.

The business lobby will release its final report in late July.