Japan's base pay rises at record pace in boost for new leader

TOKYO - Base salaries for regular workers in Japan grew at a record pace, providing a tailwind for Prime Minister Shigeru Ishiba as he prepares to lead his party in a general election later this month.

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Base pay for full-time workers rose by a record 2.9 per cent in August from a year ago, accelerating from a 2.6 per cent pace in July, the Labour Ministry reported on Oct 8. Growth in nominal cash earnings for all workers slowed to 3 per cent, a tad stronger than the consensus estimate.

In a less promising development, real wages declined after advancing for the past two months, while a separate report showed that household spending fell.

The wage data came as the newly installed leader prepares to seek a mandate in a general election to be held on Oct 27.

Mr Ishiba has vowed to apply pressure on businesses to keep wages rising, building on the biggest increases in three decades secured by workers in 2024.