"Real Wages Decline Amid High Inflation
Driven by Soaring Rice Prices"
Nihon Keizai Shimbun (Nikkei) reported that Japan's real wages decreased by 0.5% year-on-year last year, marking a decline for the third consecutive year. Although nominal wages rose significantly due to wage increases, high inflation, including a surge in rice prices, led to a decrease in real wages.
According to the 2024 Monthly Labour Survey (final results for workplaces with five or more employees) released by Japan's Ministry of Health, Labour and Welfare on this day, real wages adjusted for price fluctuations fell by 0.5% compared to the previous year. This marks three consecutive years of negative growth.
The decline in real wages narrowed by 1.7 percentage points compared to the 2.2% decrease in 2023. The consumer price index used to calculate real wages, excluding imputed rent for owner-occupied housing, rose by 3.5% year-on-year in 2024, with the growth rate exceeding 3% for the third consecutive year. Including imputed rent for owner-occupied housing, the price index increased by 3%. Based on this, real wages remained flat.
The average monthly cash earnings per person, which corresponds to nominal wages, increased by 3% year-on-year to 349,388 yen. The growth rate expanded by 1.7 percentage points compared to 2023. This is the first time since 1991, when it reached 4.4%, that the nominal wage growth rate has reached 3%.
By employment type, monthly cash earnings for regular employees and similar workers increased by 3.5% to 455,726 yen, while part-time workers saw a 3.9% increase to 112,637 yen.
Scheduled earnings, which include base salary and family allowances, rose by 2.1% to 263,381 yen. Special payments such as bonuses increased by 7.5% year-on-year to 66,318 yen.
Nikkei explained that although nominal wages recorded a high growth rate, real wages turned negative due to rising prices, especially for food products.
Meanwhile, the Japanese government has set a goal of increasing real wages by 1% annually over the next five years, until 2029.
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