Japanese metalworkers are demanding a record high wage increase

This demand is remarkable compared to the 6,000 yen requested in the current year and reflects changes taking place in Japan under the influence of labor shortages and high inflation.

This pressure to raise salaries points to the trend of large Japanese firms to invest in their employees and reward them with higher wages rather than hoarding cash. The 10,000 yen base wage increase requested for 2024 represents one of the highest demands recorded since 1998.

The development is part of a push for wage increases by various unions across Japan fighting against long-standing deflationary trends, particularly Rengo, the largest union confederation. But smaller businesses may struggle to afford such large wage increases. The push to raise wages also reflects the central bank's push to meet its 2% inflation target, supported by sustainable wage increases.