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News Navigator: How has the pandemic affected Japan's minimum wage hike?

In this February 2018 file photo, people are seen marching in Tokyo's Shinjuku Ward to call for a minimum wage hike. (Mainichi/Jun Ida)

The Mainichi Shimbun answers some common questions readers may have about Japan's minimum wage and the effects of the COVID-19 pandemic on it.

    Question: What is a minimum wage and how much is it in Japan?

    Answer: A minimum wage is the lowest hourly amount a company must pay its workers. In Japan, it gets renewed every year in each prefecture, and a business will get fined if they violate it. The highest minimum wage in the country since October 2020 is set in Tokyo at 1,013 yen (about $9.30), while the lowest is 792 yen (about $7.26) in Akita, Okinawa and other prefectures. Japan's weighted average minimum wage per worker -- calculated by multiplying each prefecture's minimum pay by the number of workers in the area, adding them all up and dividing it by the country's combined number of laborers -- is 902 yen (about $8.27).

    Q: How is Japan's minimum wage decided?

    A: In late July every year, the Health, Labor and Welfare Ministry's three-party Central Minimum Wages Council, comprising respective representatives of labor and management as well as experts from a neutral position, decides on a rough amount of how much the minimum wage should be raised. Using that figure as a reference, each prefectural council decides its minimum wage based on livelihood expenses in the area and companies' ability to pay wages, among other factors. A renewed minimum wage then comes into effect around October.

    Q: Does it go up every year?

    A: In recent years, the Japanese government has been strengthening its minimum wage intervention efforts to stimulate the economy. In 2015, then Prime Minister Shinzo Abe announced a goal of raising the minimum wage to 1,000 yen per hour, and every year between 2016 and 2019, the weighted average minimum wage was raised at least 3%, or between 21 and 29 yen. In 2020, however, the average minimum wage was raised by just 0.1%, or 1 yen.

    Q: Does the coronavirus pandemic have something to do with this?

    A: Exactly. Business performance mainly among small- and mid-size firms and small-scale businesses has worsened, and the management representatives in the central council resisted raising the minimum wage. As a result, the council made an unusual decision of not presenting a rough indication for a raise, leading to nominal increases of 1 to 3 yen in 40 prefectural councils out of 47 prefectures.

    Q: What are the main issues of conflict between labor and management?

    A: The labor side is arguing that wages in Japan are significantly low among developed economies. Management, on the other hand, says they wouldn't be able to protect employment if the minimum wage is raised.

    (Answers by Satoko Nakagawa, Lifestyle and Medical News Department)

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