Japanese government committed to raising wages

Japan’s government will make raising wages a top priority in its economic policy next year, declared Deputy Chief Cabinet Secretary Seiji Kihara.

“The biggest challenge for Japan’s economy is a lack of wage growth. Unless wages rise, consumption won’t pick up and companies won’t increase investment,” Kihara said.

It is ultimately the responsibility of the organisation to determine the level of pay increases, but the government can help achieve higher wages through tax incentives, Kihara said, as well as encouraging organisations to disclose more information regarding their human resource activities.

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These remarks are aligned with those made by Haruhiko Kuroda, Governor of the Bank of Japan (BOJ), who has stressed the importance of raising wages for the economy to sustainably achieve its 2% inflation target.

“The government will increase its focus on achieving wage growth. This is particularly important because prices are rising,” he added, reported Reuters.