Japan’s largest labor union federation will keep seeking at least a 5% wage hike in next year’s pay talks, as new Prime Minister Sanae Takaichi attempts to keep the country’s wage momentum going.
In negotiations starting later this year, Rengo will seek total pay increases of 5% or more, including a 3% rise in base salary, according to goals clarified in its basic policy framework Thursday. A year ago the annual talks began with the same targets, ultimately delivering average gains of 5.25% overall for 2025. The goals will be officially confirmed in late November.
If Japan can’t keep up its wage-hike momentum, that has implications for both Takaichi’s tenure and the central bank’s policy path. As inflation continues to hit households, a lack of real wage growth would likely feed into further discontent among voters, while the Bank of Japan might struggle to maintain its policy tightening path.
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