Japan's wages continue downward, weak demand stymies production
- Source: Global Times
- [01:24 November 03 2009]
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Japanese monthly wages, including overtime and bonuses, dropped 1.6 percent to an average of 266,364 yen ($2,928) in September, marking the 16th consecutive month of year-on-year decline, according to data released Monday by the Ministry of Health Labour and Welfare.
Overtime pay, a barometer of strength in corporate activity, fell 12.5 percent in September from a year earlier, the 14th straight month of declines.
"Private consumption remained generally weak amid the increasingly severe employment and income situation, although there were signs of a pickup in durable goods consumption largely owing to the effects of various policy measures," the Bank of Japan said in a report last week, indicating more difficulties ahead.
Separately, Japan's corporate tax refunds exceeded revenues in the first six months of fiscal 2009 for the first time since the 1960 fiscal first half, when comparable data was first made available, the Kyoto news agency quoted the Japanese Finance Ministry as saying Monday.
The fresh data further demonstrates that firms are suffering from weak demand and a stronger yen, which clearly has eroded their production efforts.
Such pains now have to be transferred into the lives of most employees, lowering their optimism and leading to less spending for average people.
"Wages will keep falling for some time," Kyohei Morita, chief economist at Barclays Capital in Tokyo, told Bloomberg. "Exports are picking up, but with a stronger yen, there will be continued pressure to cut costs."
Regular employment also fell last month by 0.1 percent. The number of fulltime employees declined by 0.1 percent, while the number of part-time employees increased by 1.5 percent when compared with the previous year.
Tokyo stocks fell sharply Monday, with the key Nikkei index down 231.71 points, or 2.31 percent, to 9,802.95, the lowest close in about three weeks, as fresh pessimism prevails regarding the strength of a global economic upturn and uncertainty over a full-fledged recovery in the Japanese corporate sector crept back into investors' minds.
Agencies
