A panel of the Central Minimum Wage Council, an advisory body for the health, labor and welfare minister, on Aug. 6 recommended that the minimum hourly wage be raised by ¥14 on average to ¥763.
This will be the first time that the minimum hourly wage is raised by ¥10 or more since it was raised by ¥17 in 2010. The recommendation is a tiny step in the right direction at a time when the nation needs wage increases to get out of a long period of deflation and to ensure a steadfast economic recovery.
The Abe administration hopes that a raise of the minimum wage will lead to expansion of consumption, and thus to sustainable economic growth. Although Prime Minister Shinzo Abe cannot tell the panel what to do, the panel apparently felt pressure from the administration. The ¥14 raise is an increase of about 2 percent, which roughly corresponds to the Abe administration's goal of attaining wages hikes of 2 percent or more.