TOKYO -- The operator of the Uniqlo chain of casual apparel stores will pay midcareer hires up to 1 billion yen ($8.8 million) a year as competition heats up with Big Tech companies such as Amazon.com, Nikkei has learned.
Fast Retailing will increase the salary cap this year, said CEO Tadashi Yanai. More than Yanai's own pay of 400 million yen, the maximum amount will be among the highest in the nation.
Until now, the company did not have any clear compensation standards for midcareer hires. It hopes to attract talent well-versed in digitization, e-commerce and supply chains to change how it earns profits in the apparel business to better compete with tech titans.
"We are looking for people who can create new value and think about businesses from scratch, not consultants and those who worked at big corporations," Yanai said. "Geniuses who are more capable than me. If the pool is bountiful, we'll take 100 or even 200."
Fast Retailing had roughly 56,000 workers groupwide as of Aug. 31. Excluding staff at stores such as Uniqlo, its headquarters had about 1,600 employees, mostly midcareer hires. The average pay is about 9.6 million yen.
Fast Retailing's maximum pay for midcareer hires will be higher than that of CEO Tadashi Yanai.
Online sales of apparel have grown sharply amid the coronavirus pandemic. Tech giants are intent on bringing about structural changes in the apparel industry, as exemplified by Google's efforts to strengthen its e-commerce business by partnering with major online retailers.
"In the future, our rival will be GAFA [Google, Apple, Facebook (now Meta) and Amazon] rather than Zara," Yanai said.
Salaries at Japanese companies are often seniority-based because they go hand-in-hand with the practice of lifetime employment. A move by the nation's leading apparel company to sharply boost the pay of midcareer hires could affect the way corporations compensate employees.
A person who switched jobs received an average of 4.53 million yen in their first year as of November, according to Mynavi, an employment website operator. The average for the logistics, retail and food industry, which includes apparel, was 4.06 million yen.
CEOs in Japan took in an average annual salary of 120 million yen, according to a fiscal 2020 survey by the Deloitte Tohmatsu Group, compared with 1.58 billion yen in the U.S. and 330 million yen in the U.K. Fast Retailing is poised to offer an amount on a par with Western business chiefs to prospective hires.
