Japan’s wage growth holds momentum after small firms reach deals

Rengo's tally showed that the average wage gain secured by labor unions stayed above the group's 5% target for a third straight year
By Erica Yokoyama and Akemi Terukina
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Japan's largest labor union group reported that workers under its umbrella secured an average pay increase exceeding 5% in this year's wage talks even after results from smaller firms were factored into the tally, an outcome that will keep the Bank of Japan on track for a near-term interest rate hike.Unions under the federation known as Rengo have so far won an average wage gain of 5.08%, according to an updated tally released Friday
While down from an initial 5.26%, the overall figure stayed above the group's 5% target for a third straight year.The latest tally includes agreements from 2,156 firms with 300 or fewer employees, up from 552 in the initial report in March
Smaller firms tend to report wage hike agreements later than large firms, and those results have pulled down the overall average in recent years.

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