Grinch Eyes Winter Bonuses in Japan

Monthly wages are rising, but not as much as the government wants

The Grinch is after your hard-earned cash.

Photographer: Bonnie Jo Mount/Washington Post via Getty Images

Japan’s weak economy doesn’t need any more bad news, though it looks like that’s coming as analysts forecast a drop in winter bonuses for salaried workers. 

Full-time permanent employees can expect an average decline of 1 percent in their year-end payouts, according to an estimate from BNP Paribas SA. Mitsubishi UFJ Research Consulting Co. projects a fall of 2.1 percent. 

That’s a bitter pill for workers after summer bonuses shrank, and a disappointment for the government of Prime Minister Shinzo Abe as it pushes for pay gains to help fuel consumer spending and economic growth. 


While monthly base wages are rising -- and are a more important determinant of consumer spending than bonuses -- they have so far fallen short of the hopes of Abe and the central bank.

Base wages may grow about 0.5 percent to 1 percent next year, according to Masamichi Adachi, an economist at JPMorgan Chase & Co. and a former Bank of Japan official. 

BOJ Governor Haruhiko Kuroda said last week that wage gains have been “somewhat slow” considering high business earnings and the tight labor market. 

wages revised

Economists at BNP and Goldman Sachs Group Inc. noted that companies may have curbed bonuses and other benefits as they bumped wages a little higher in 2015. 

That could provide workers with a dash of hope that some of what they lose in their winter bonuses makes it way back into their paychecks when spring talks get underway for monthly wages next year. 

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