Wage bargaining is the stuff of the annual springtime labor offensive known as "shunto." This year's wage round, however, is essentially different from previous ones because wage increases are not the main subject of labor-management negotiations. The Japanese Trade Union Confederation, or Rengo, the nation's largest labor group, has given up setting a customary numerical target for wage demands, leaving the initiative to member industrial unions.
Pace-setting metalworkers unions, notably those in the steel, electric machinery and auto industries, have already given up demanding extra wage increases. Employers in these industries are set to make their formal replies in mid-March in accordance with a long-standing custom. Aside from Nissan Motor and perhaps a few other companies, however, it appears to be a foregone conclusion that new pay raises are off the table.
That is hitting small unions particularly hard. Wage talks in the small-business sector normally start later during the shunto, as they are based largely on the levels of concessions won by large unions. In better times, when most companies could afford to raise wages, this phased bargaining formula had favorable ripple effects on small-business wages. Now, however, that virtuous cycle is going into reverse. By the same token, the practice of big-business employers' making synchronized replies to union demands -- which in the past also helped to boost wages across the board -- is no longer useful.