Back number

No.242 (2017/8/1)
Council Proposes National Average Minimum Wage Hike of 25 Yen for Fiscal 2017

On July 26 the tripartite Central Minimum Wage Council, which consists of six members each representing the public interest, labour, and management, announced that its proposed minimum wage hike guideline for fiscal 2017 was a national average of 25 yen/hour (the equivalent of a 3% raise to 848 yen), which if implemented would be the highest increase ever. If the minimum wage were increased by 3% every year, it would reach 1,000 yen in seven years' time.

From now on regional Minimum Wage Councils in each prefecture will decide new minimum wages to be applied from October. In fiscal 2016 the national average at the time of the central council's subcommittee decision was 822 yen, up 24 yen from the previous year (an increase rate of 3.0%). In fiscal 2015 the national average was 798 yen, up 18 yen (2.3%).

Among the members of the Organization for Economic Cooperation and Development (OECD), however, Japan's minimum wage remains at a low level. One of the main reasons why the amount has been kept so low is that in determining the minimum wage, much importance has been placed on the ability of companies to pay.

Personal consumption, which accounts for 60% of gross domestic product, is stagnant. In its Action Plan for the Realization of Workstyle Reform, the government stipulates that it will aim for a national average minimum wage of 1,000 yen so as to ensure a positive economic cycle. Raising wages is the only way to bring about a full-fledged recovery of personal consumption. Sound economic development depends on giving all workers a sense that things really are getting better.

Copyright(C) JILAF All Rights Reserved.