Japan's annual wage negotiations kicked off on Wednesday, with a focus on whether the momentum for pay raises growing among the country's large companies will spread to smaller firms amid historic price rises.
Leaders of the Japan Business Federation, the country's top business lobby known as Keidanren, and the largest labor union, Rengo, joined a forum held in Tokyo to herald the official start of the annual "shunto" spring negotiations.
"It is the social duty of private firms and Keidanren to pursue wage hikes that beat soaring prices with stronger resolve than last year," Masakazu Tokura, the chairman of Keidanren, said in a video message.
The remarks came as Japan's major companies raised wages by 3.99 percent on average last year, the biggest increase in 31 years.
While praising the companies' efforts last year, Tokura also emphasized that the positive effect must also spread to small and medium-sized firms to achieve continual wage hikes in the country.
Amid the changing tide, Rengo's confidence has grown, saying it aims to achieve wage increases of 5 percent or more this year, compared to around 5 percent last year.
This year's negotiations are attracting heightened attention as the Bank of Japan, which has driven the country's unprecedented monetary easing measures, is closely watching the trend to determine the timing for ending its negative interest rate policy.
The central bank maintained its ultraeasy monetary policy Tuesday despite its increased confidence about its inflation outlook, saying that the outcome of the annual wage negotiations will be important in guiding monetary policy.
