Japan real wages drop for 3rd straight yr in 2024 as inflation bites
Ideas:
Japan wage hikes usually only happen once a year in April at the beginning of the new fiscal year. And of course inflation is year round so its not a surprise that wage increases were not enough to overcome increases in inflation.
Yes, wage increases were the highest in 33 years in Japan but problem as been wage increases have been very little or not at all the past 20 years in Japan.
Nominal wages don't tell the real story as they are wage and inflation combined so they don't show the real story about wages and inflation in Japan.
Consumer prices, again, are not once a year and can be every month while again, wage increases only happen in April the beginning of the new fiscal year in Japan.
Consumer prices might have decreased some but they are probably still high for some income groups in Japan.
Yes, bonuses for small Japanese companies might have helped as small Japanese companies and midsize companies don't have the ability to pay the wage increases as large Japanese companies.
Wages in Japan compared to the other OECD countries are not as good as Japanese companies/society uses bonuses two times a year to make up for the low wages.
But even then, with the bonuses paid in December and May, they probably when added with the wages are still not good compared to wages in other OECD countries.
Japan has a long way to go to try and be competitive with wages in other OECD countries as its 2 decade freeze on wages has not been good for Japan and Japanese households.
Any increase in real wages is good and needed in Japan, but at the same time 0.6 percent from the year before is still not good for many Japanese households.
Again, nominal wages are not a true indicator for wages in Japan as they also include inflation added to wages.
Real wages are what is important as they indicate the purchasing power of Japanese households in Japan.
Have a nice day!
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.