Japan's Minimum Wage: Updated July 18, 2024.

 

Editorial: Japan's minimum wage must be increased as prices rise, livelihoods flounder

Article Source:  https://mainichi.jp/english/articles/20240716/p2a/00m/0op/016000c#cxrecs_s

Ideas:

The minimum wage situation has always been a difficult topic as companies don't want to pay and governments are trying to figure out what is the optimum wage for a worker, who might not have the best skills for an economy or society, but need to be able to live normal lives.

Maybe, just maybe many years ago, the minimum wage was enough to live on, barely, but now with cost of living consistently increasing it becomes impossible for someone to live a normal life on the current minimum wage levels.

As each prefecture might have different levels of economic activity, and different cost of living situations, what is good for Tokyo and Osaka might not be a good minimum wage for one of the rural prefectures.

Its unfortunate, but understandable that small and mid-size companies have to pay a minimum wage as maybe their profit margins are very thin, and part of the problem might be they are suppliers to larger companies that maybe force them to keep costs down that they charge the larger companies.

Of course non-regular employees might always be at the bottom of a company, with little or no benefits and then only minimum wages.

It seems full-time workers, who might look like regular employees don't have the same wage as other full-time workers, as maybe many service type companies employ women who might not have the best skills but they need to work for their families.

The minimum wage gap between different prefectures is only a small part as to why younger people might be leaving the rural areas to try and work in a large metropolitan area, as they are looking for better opportunities and not just wages.

The employment situation in Japan, like other economies is a very complicated situation, as maybe many small and midsize companies know what the situation is but their profit margins just can't handle any more wage increases.

At the same time, to get new and better talent to work for their company they know they need to increase wages, including the minimum wage.

Improved productivity, utilizing government subsidies, and other measures are good, but will they solve Japan's work place challenges.

Its a puzzle that is not easy to solve as there are many variables to consider to get the Japanese workplace up to international standards.

Passing on increased labor costs and or material cost increases to business partners is always a challenge as maybe large companies put a lot of pressure on small companies to keep costs lows which means maybe small companies can't increase wages and if they try to pass on their costs to large company partners they might be be told your contract with us as a supplier will not be renewed.

Yes, if possible, the Fair Trade Commission should do what it can to monitor price or contract negotiations, as unfortunately, there are some large companies will try to use their large company position or market power position to influence what smaller companies can do.

The minimum wage needs to increase in Japan, like regular wage increases need to increase as wages in Japan are far below international standards.

Again, its a very complicated puzzle that didn't happen just yesterday, as the situation has been developing for decades and Japan used to be higher in wage international standards but now its at the bottom related to OECD or advanced economies.

Have a nice day and be safe!