Japan's Real Wages Decline for 25 Consecutive Months...Longest Streak on Record

Real wages of Japanese workers have been declining for 25 consecutive months compared to the same month of the previous year.

According to the "April Labor Statistics Survey" (preliminary figures) announced by the Japanese Ministry of Health, Labour and Welfare on the 5th, the average monthly salary per worker at companies with five or more employees was 296,884 yen (approximately 2,616,736 won), an increase of 2.1% compared to the same month of the previous year.

Tokyo Shibuya Station
[Image source=AFP Yonhap News]

However, real wages adjusted for price changes actually decreased by 0.7%. This marks the 25th consecutive month of decline. The previous longest record was a 23-month decrease from September 2007 to July 2009, but this record has been broken since March of this year.

The Japanese government is encouraging companies to raise wages. Although companies have responded accordingly, the pace of wage increases has not kept up with the rise in prices. The April consumer price index used to calculate real wages in Japan rose 2.9% compared to the same month of the previous year.

Due to the depreciation of the yen and the resulting rise in import prices, the downward trend in real wages is expected to continue for some time. A Ministry of Health, Labour and Welfare official told NHK, "It is impossible to predict when the trend of real wage growth will turn around."