Japan Aims to Achieve 1% Real Wage Gains Within Next Five Years

The Japanese government is likely to establish 1% growth in real wages as its first-ever official target for pay increases, a move that comes as prolonged inflation continues to exert a drag on domestic demand.

The government will set a goal of reaching 1% annual gains in real wages by the fiscal year starting in April 2029, according to a policy draft by Prime Minister Shigeru Ishiba’s new capitalism panel released Wednesday. The goal is based on the premise that stable and sustainable 2% inflation is in place.