Japan's inflation-adjusted wages slip in September for 18th month
TOKYO (Reuters) — Japan's real wages slipped in September for an 18th month, government data showed on Tuesday, with rising prices squeezing consumers' purchasing power, and likely to add to pressure from labour groups for higher wage increases.
Financial markets worldwide pay close attention to the wage trends in the world's third-largest economy. The Bank of Japan regards sustainable pay increases as important for unwinding its ultra-loose monetary stimulus.
Inflation-adjusted real wages, a barometer of consumer purchasing power, dropped in September by 2.4% from a year earlier after a revised 2.8% fall the month before, data from the Ministry of Health, Labour and Welfare showed.
The consumer inflation rate officials use to calculate real wages, which includes fresh food prices but excludes owners' equivalent rent, slowed to 3.6%, the lowest since September last year.
Still, nominal pay growth in September was 1.2%, after a downward revision of 0.8% in August and only slightly better than in July.
Japan's largest labour organisation Rengo is expected to demand pay increases of 5% or more, while the largest industrial union, UA Zensen, will seek a 6% wage increase in negotiations early next year.
Prime Minister Fumio Kishida's government last week drew up a 17 trillion yen ($113.72 billion) economic stimulus package that includes slashing annual income tax and other taxes by 40,000 yen ($267.58) per person and paying 70,000 yen to low-income households.
Special payments fell 6% year-on-year in September after a revised 6.3% decline in August. The indicator tends to be volatile in months outside the twice-a-year bonus seasons of November and January and June to August.
Base salary growth in September advanced by 1.4%
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