Oct 27 (Japan Today) - Prime Minister Shinzo Abe on Thursday called for pay hikes through negotiations between management and labor unions next spring, making such a request for the fifth straight year to inject fresh momentum into wage growth.
"I hope to see wages raised by 3% in next spring's wage talks," Abe told a government panel meeting at his office. It's rare for the prime minister to refer to a specific number for wage increase.
Abe also said the government will take "all possible measures" such as taxation and regulatory reform to lay the groundwork for companies to spend their record profits more on wages and capital investment.
The remarks came after some private-sector members of the Council on Economic and Fiscal Policy said they view 3% wage growth as desirable in bracing for future inflation.
With Japan's economy expanding for a sixth straight quarter, Abe, fresh out of a decisive win for his Liberal Democratic Party in Sunday's election, has touted an improving labor market as one of the achievements under his Abenomics policy mix.
But wage growth remains tepid as companies prefer hoarding cash for the future. Companies achieved a gain of some 2 percent in salaries in annual springtime shunto wage negotiations this year.
Economists say more robust wage increases are critical for consumers to increase consumption, a key driver of the economy, and for the Bank of Japan to hit its elusive 2% inflation target.
