Japan’s PM Abe urges companies to lift wages by 3% or even more

Japan’s PM Abe urges companies to lift wages by 3% or even more

On Tuesday, Japanese Prime Minister Shinzo Abe urged companies to have wages lifted by 3% or even more in 2018, thus keeping up pressure on companies to spend their enormous cash pile on wages for the purpose of broadening the benefits of his "Abenomics" stimulus policies.

Abe told that the government needs to sustain and strengthen the country’s positive economic cycle in 2018 just to achieve their long-standing objective of taming deflation. Exactly to reach this goal he asked Japanese companies to lift wages by 3% or even more next spring.

According to government data, wages at big companies have been going up moderately more than 2% every year since 2014, and a leap of 3% or more in 2018 would help the Bank of Japan to meet its 2% inflation objective.

As BOJ Governor Haruhiko Kuroda told, Japanese companies were still hesitant to have wages lifted due to the fact they were used to prioritizing job security over wage lifts for 15 years of deflation.

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