The Health, Labour and Welfare Ministry is requesting a tenfold increase in next fiscal year's budget for wage subsidies to carmakers and other manufacturers, as the recession forces production cuts.
The ministry is asking for ¥58 billion for the fiscal year starting in April, compared with this year's budget of ¥5.5 billion, Tomochika Mizuno, section chief of the labor ministry's employment development division, said Thursday.
The number of manufacturers requesting wage subsidies surged sixfold in December from November as domestic automakers have slashed output and the government made funding easier. Japan created the subsidy program in 1975 to help pay salaries at companies forced to rapidly scale back production due to economic declines.
If approved, next fiscal year's budget would be the largest in 15 years. December's wage subsidy applications climbed to 339 last month from 57 in November after the ministry created another program for small to midsize firms and relaxed restrictions.
Last month about a third of all applications came from the auto industry. Last week, Mazda Motor Corp. and Mitsubishi Motors Corp. said they had requested subsidies.
The largest budget for the program was ¥66 billion during the 1994 fiscal year, Mizuno said.