Japan Labor Group Rengo to Seek Wage Hike of 5 Pct of More

Urayasu, Chiba Pref., Nov. 28 (Jiji Press)–The Japanese Trade Union Confederation, or Rengo, formally adopted a plan Friday to demand a pay increase of 5 pct or more in “shunto” annual spring wage negotiations next year. The umbrella body for labor unions across the country will seek a pay raise of at least 6 pct for small and midsize companies, also as part of its shunto policy. Rengo will thus aim to achieve the levels of pay hikes attained this year to improve living standards of workers in a country where inflation-adjusted real wages have kept falling. The overall target of the 5 pct wage hike includes pay scale growth of at least 3 pct, Rengo said. The shunto policy also establishes a numerical target for wages of nonregular workers, such as part-timers, for the first time, envisioning an increase of 7 pct. “If (inflation and wage increases) are not balanced, the economy will shrink, and we will fall back to ‘the lost three decades'” of low growth and deflation, Rengo President Tomoko Yoshino told a central committee meeting in Urayasu, Chiba Prefecture, which neighbors Tokyo. She emphasized that the 2026 shunto talks will be a “crucial moment of whether or not Japanese society will be able to establish wage increases as a norm and break away from the deflationary mindset.” According to Rengo, the weighted average of wage increases in the 2025 shunto was 5.25 pct, exceeding 5 pct for the second consecutive year. However, wage growth has not kept pace with price increases. Real wages slid year on year for the ninth consecutive month until September. Additionally, the wage increase rate for small and midsize labor unions was lower than the overall rate, showing a wider gap with bigger entities. In its 2026 shunto policy, Rengo said that despite accelerated wage hikes over the past three years, “only a few people feel their lives have improved.” To boost personal consumption and create a virtuous cycle of the economy, “it is essential to spread wage hikes to small and midsize companies and address disparities,” Rengo also said in the policy. Labor unions under Rengo will work on their shunto policies to prepare for next year’s labor-management negotiations, which are seen going into full swing as early as February. END [Copyright The Jiji Press, Ltd.]