Salaries increased by up to 40% for Uniqlo employees in Japan, to better offset recent increases in inflation and match more competitive wages overseas. The Japanese clothing operator, also present in Italy, said that the contractual revision will take place in March and will concern about 8,400 employees in the Land of the Rising Sun, regardless of the place of work and the duties performed. The Tokyo-based company posted a record full-year profit up 61 percent to 273 billion yen in the fiscal year that ended last August.
According to a recent market survey, average wages in Japan are lower than those in the United States and Europe, and in advanced economies in general. In a speech addressed to the business community earlier this year, Conservative Prime Minister Fumio Kishida had urged company executives to adjust workers’ compensation to avoid the risk of stagflation, with wage growth well below the increase in consumer prices.
During a meeting with local media, the head of the cabinet, Hirokazu Matsuno, welcomed Uniqlo’s decision, hoping that other companies would follow suit, increasing workers’ wages “to the maximum”.
According to Fast Retailing Group, Uniqlo’s parent company, the wage hike is aimed at narrowing the wage gap with overseas employees and boosting the company’s global competitiveness. “Each employee’s new compensation will be decided on the basis of globally aligned evaluation criteria. Factors such as job performance and achievements, ability to contribute to the business, ambition and growth will be redefined and a fair evaluation of grades will be made,” reads a company statement.
Starting salaries for graduates will be raised from the current 255,000 yen a month to 300,000 yen (approximately $1,920-2,260). The monthly salary of the new branch managers will be 390,000 yen ($2,942), an increase of 100,000 yen ($755). According to the information, the annual earnings of other employees will also be increased by up to 40%.
The Japanese government has asked companies to raise wages due to the rising cost of living. The global apparel company’s move is expected to affect the annual spring pay talks between employers and workers across Japan. As per tradition in the country, wage negotiations will in fact be at the center of the spring season of the “shunt”, the phase of negotiations during which the major trade union groups discuss wage increases.