Benchmark
Corporate Japan Stacks Up Cash, Skimps on Pay Raises
Economy relies on exports as consumer spending suffers
A shopper in Fukuoka, Japan in January.
Photographer: Tomohiro Ohsumi/BloombergThis article is for subscribers only.
With profits soaring, Japanese companies’ record-breaking cash pile rises ever higher. That’s bad news for the economy, which is relying on exports to sustain a modest recovery as consumers struggle with stagnant wages.
Japan’s biggest economic problem is too much income flowing to companies and their piles of unproductive cash are the main obstacle to revitalizing consumer demand, according to Diana Choyleva, chief economist at Enodo Economics.