Japan aims to bolster economy through wage hikes

The Japanese government aims to bolster its economy through wage hikes, it said on Tuesday. 

The government also outlined a goal to pursue a society that will encourage people to have children and raise them, in its draft outline of economic and fiscal policy guidelines that will be released in June, according to Jiji Press. 

The draft highlighted support for childcare, digital reforms, regional revitalisation, and the realisation of a green society as engines of growth for the country. 

To spur regional revitalisation and encourage the flow of people from urban to regional areas, the government will raise the national average of minimum wages to ¥1,000 (US$9.16) per hour.

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“We’ll tackle the four tasks, promote bold investment and innovation by the private sector and bring about a shift in the social economic structure,” said Prime Minister Yoshihide Suga at a meeting with his Council on Economic and Fiscal Policy. 

Minimum wages in Japan had risen 3% on average a year, from fiscal year 2017 to 2019, but stopped in 2020 as businesses tightened their belts due to the pandemic.