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Japan's average minimum wage should be raised to 874 yen per hour: panel

Representatives of labor unions in Toyama Prefecture explain their demand for a sharp rise in the local minimum wage to Toyama Labor Bureau officials at the prefectural government headquarters on July 9, 2018. (Mainichi)

TOKYO -- The country's average minimum hourly wage should be raised by a record 26 yen to 874 yen in the current fiscal year, a subcommittee of the government's Central Minimum Wage Council decided on July 24.

The council, an advisory panel to the labor minister, is set to report the decision to the labor minister on July 26. Based on the figures, the Local Minimum Wage Council in each of the country's 47 prefectures will decide their new minimum wages, which will take effect in October.

The current minimum wage is 848 yen per hour on national average. The upcoming 26 yen spike is 1 yen above the level in FY2016 and FY2017 and the largest raise since FY2002 when the minimum hourly wage was adopted in place of minimum daily wage.

The subcommittee graded the 47 prefectures by four ranks from A to D based on their regional economic climate and other factors and set the benchmark wage hike for each of the ranks. Tokyo, Osaka and other prefectures in the A group are called on to increase their minimum wage by 27 yen, while the amount for B-ranked prefectures including Kyoto and Hiroshima is set at 26 yen. The corresponding figure for Hokkaido, Fukuoka and other C-ranked prefectures is 25 yen, while that for Aomori, Okinawa and other prefectures in the D category is 23 yen. All these raises were larger than the previous year.

If the minimum wages are boosted in compliance with the benchmark hikes, Tokyo will enjoy the country's highest minimum wage at 985 yen. At this rate, the capital's lowest wage is likely to top 1,000 yen as early as fiscal 2019. Meanwhile, the lowest minimum wage, at 760 yen, will be instituted in Kochi, Saga, Nagasaki, Kumamoto, Oita, Miyazaki, Kagoshima and Okinawa prefectures.

The government is aiming to raise the minimum wage by around 3 percent year-on-year to 1,000 yen per hour. During discussions at the subcommittee, which is comprised of representatives from both labor and management and public interest members such as university professors, the labor and management representatives clashed head-on over the yardstick hike amounts, with the labor side demanding a steeper rise while the management camp opposing the request on the grounds that small- and medium-sized businesses are struggling financially. In the end, the subcommittee reached an agreement after adopting a proposal by a public interest member that gave consideration to the government policy.

The record hike represents a year-on-year increase of over 3 percent for the third time in a row, meeting the government's goal.

(Japanese original by Shunsuke Kamiashi, City News Department)

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