Toyota Motor Corp., the world’s largest automaker, will be asked by its labor 329,000-strong labor group, Federation of All Toyota Workers’ Unions, to raise their employees’ base wages. This is seen by many analysts as the first step towards a unified increase in wages for Japanese corporations which can lead to the end of a decade-long deflation for the world’s third largest economy.
It will be the first time since 2008 that the group will be asking for an increase during wage negotiations which will be held sometime in the spring of next year. They will be the first of Japan’s big labor confederations to ask for a raise which can pave the way for other big firms to also do likewise. However, the federation has not confirmed the report and says they still have not reached a consensus among the 312 unions that are part of the group and who represent workers in the main company, estimated at 69,000 as of this year, as well as their sales offices and major suppliers in Japan.
Toyota President Akio Toyoda mentioned in October this year that he was willing to pass off a portion of their profits to the employees through increased pay, but was just waiting for the union to make a move. They are expecting a 70% increase in profits this year at around $21.4 billion, which is close to their record before the Lehman Brothers crisis of 2008. Meanwhile, Japan’s largest labor organization, the Japanese Trade Union Confederation, is calling for at least a 1% rise in base pay for the member federations and unions. Part of Prime Minister Shinzo Abe‘s “Abenomics” or economic stimulus plans is an increase in wages to be able to sustain economic growth and create a cycle of higher income and better consumption.
[ via Reuters ]