Japan’s Real Wages Drop, Marking Third Straight Annual Decline
(MENAFN) Japan saw a 0.5 percent drop in average inflation-adjusted monthly wages during fiscal 2024, marking the third straight annual decline, according to government data released Thursday.
Although the drop in real wages was less severe than the 2.2 percent decrease recorded in fiscal 2023—the steepest since fiscal 2014—it still underscores ongoing pressure on household purchasing power, the Ministry of Health, Labor and Welfare reported.
Throughout the fiscal year ending in March, wages at companies with five or more employees only saw year-on-year gains during months when bonuses were disbursed—specifically June, July, November, and December.
On a nominal basis, which does not account for inflation, monthly wages including bonuses climbed 3.0 percent to an average of 349,388 yen (around 2,400 U.S. dollars). This marks the fourth consecutive annual increase and the highest level in 33 years, the ministry noted.
However, this nominal growth continued to be outpaced by inflation. Consumer prices—factoring in fresh food but excluding rent—rose 3.5 percent. This marks the third year in a row that inflation exceeded 3 percent, surpassing the pace of wage increases.
In March alone, real wages fell 1.8 percent from a year earlier. This figure was slightly improved from an earlier preliminary estimate of a 2.1 percent decline.
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