"Boost Real Wages by 1%" Japan Targets 1,885 Trillion Won Public-Private Investment by 2040

Pushing for Minimum Wage Hike and Support for Small and Medium-Sized Enterprises

The Japanese government is implementing a variety of policies aimed at boosting real wage growth in order to revitalize the economy.

According to the Yomiuri Shimbun on June 6, the Japanese government has designated wage increases as a core strategy in the revised version of its growth plan, the "New Capitalism Implementation Plan." The government has set a goal of establishing "real wage growth of around 1%" by fiscal year 2029 (April 2029 to March 2030).

While Japan's nominal wages have risen for 40 consecutive months through April, real wages, which account for inflation, have not increased. In April, real wages fell by 1.8% compared to the same month last year.

Yonhap News Agency

The Japanese government plans to determine the scale of public projects and outsourcing initiatives?both of which have significant impact on regional economies?by taking inflation into account.

Additionally, the government intends to review the current focus on cost-cutting in the medical and nursing care sectors. It also plans to significantly raise the minimum wage, which is currently 1,055 yen (about 10,000 won) per hour, to 1,500 yen (about 14,000 won) by 2029.

Furthermore, the Japanese government will increase the combined public and private sector capital investment to 135 trillion yen (about 1,272 trillion won) by 2030, and to 200 trillion yen (about 1,885 trillion won) by 2040.

For small and medium-sized enterprises, the government will support research and development and the expansion of exports in key sectors such as healthcare, disaster prevention, and agriculture, forestry, and fisheries.