The phenomenon is not unique to Japan and in most advanced economies, the once tight correlation between economic growth and increases in pay has broken down
Masataka Yoshimura at Yoshimura & Sons, a tailor, in Tokyo, Japan, Dec. 16, 2021. Yoshimura said pay increases would be “truly fatal” to his custom-suit business. (Niroko Hayashi/The New York Times)
TOKYO — Over the last two years, Masataka Yoshimura has poured money into the custom-suit business his family founded more than a century ago. He has upgraded his factory, installed automated inventory management systems and retrained workers who have been replaced by software and robots.
Japan’s prime minister, however, wants him to do one more thing: Give his employees a substantial raise.
The reasoning is simple. Wage growth has been stagnant for decades in Japan, the wealth gap is widening and the quickest fix is nudging people like Yoshimura to pay their employees more. Higher wages, the thinking goes, will jump-start consumer spending and lift Japan’s sputtering economy.
©2019 New York Times News Service