In 2025, Japan’s minimum wage is set to increase to 1,118 yen per hour, as decided by a subcommittee of the Central Minimum Wage Council on July 4th. This is a 6% rise, or 63 yen, from the current average of 1,055 yen, marking the first time it has crossed the 1,100-yen threshold. This decision focuses on addressing rising food prices, and both labor and management agreed during their seventh meeting in 44 years.
Kobayashi Ken, head of the Japan Chamber of Commerce and Industry, commented on the increase, agreeing with the need for a wage boost amid rising prices and wages. However, he pointed out the difficulty for businesses, especially small and local ones, in meeting this new benchmark.
The decision now moves to discussions in each prefecture. Kobayashi noted that recently, regions have often set higher increases due to competition with neighboring areas. He emphasized the importance of considering local business conditions when determining these rates.
The 6% increase is significantly higher than the average 4% wage hike seen in small and medium-sized businesses this spring. For these businesses, struggling to raise wages further poses a serious challenge. Kobayashi urged the government to support these businesses through initiatives like the “Five-Year Plan for Promoting Wage Increases for Small and Medium Businesses,” helping them sustainably raise wages.
by MagazineKey4532