Business

Summer bonuses at major Japanese firms down 6%

Jiji

The average bonus at major Japanese companies this summer will fall 6.0 percent from a year before to ¥925,947 due to the coronavirus pandemic and a slowdown in the global economy, the Japan Business Federation, or Keidanren, said in a preliminary survey report Wednesday.

The summer bonus decline is the steepest since the plunge of 19.4 percent in 2009 amid the global financial crisis and the third sharpest since the current tallying method started in 1980.

The first-round tally covered 86 Keidanren member companies, most of which decided this year’s summer bonuses by mid-March. The final tally, scheduled for release in late July, is likely to show a deeper fall in the average due to a greater impact of the pandemic.

Bonuses average ¥900,960 at 79 manufacturers, down 5.1 percent, and ¥1,079,915 at seven nonmanufacturers, down 9.9 percent.

Of the 14 industry sectors surveyed, the steel sector saw the sharpest decline, of 25.0 percent to ¥569,679, reflecting a series of suspensions of blast furnaces due to sluggish demand.

The commercial and railway sectors also saw sharp falls as they were heavily affected by the impact of authorities’ stay-at-home requests issued in response to the pandemic.

Only four sectors including the paper-pulp sector enjoyed increases.

“There’s a possibility that winter bonuses will be lower than the summer bonuses, reflecting the impact of the coronavirus,” a Keidanren official said.

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