Nominal wages rose 4.7% year on year in July, marking their biggest increase in nearly 30 years. Scheduled cash earnings rose 4.1%, the highest level since April 1992, while real wages increased 2.4% excluding imputed rent and 2.6% on an all-items basis.
According to the latest Monthly Labour Survey released by the Ministry of Health, Labour and Welfare, total cash earnings, the equivalent of nominal wages, rose 4.7% year on year in July, accelerating from a 4.0% increase in the previous month. The figure reached its highest level since January 1997. Scheduled cash earnings, including basic pay, rose 4.1%, marking their biggest increase since April 1992.
Real wages, adjusted for price changes, rose 2.4% based on the CPI excluding imputed rent and 2.6% based on the all-items CPI. Both increases were the largest since May 2021.
The results prompted views that expectations for the Bank of Japan’s rate-hike pace could strengthen. Comments from the BOJ governor and market participants have contributed to a view that wage growth could be a factor supporting further rate hikes.