Japan to name and shame firms refusing pay hikes

TOKYO (AFP) - Japan's trade ministry said on Thursday it would take the unprecedented step of disclosing the names of firms that did not raise employees' wages in annual labour talks, after calls by the prime minister to boost pay.

The surprising move comes days after economy minister Akira Amari raised the stakes in sensitive pay negotiations with an apparent threat to take action against "uncooperative" firms.

The usually low-key talks were being closely watched to see if cash-rich firms would put more money in workers' pockets, amid worries about a looming sales tax hike slamming the brakes on growth.

The government "will react in some way" against firms which are "uncooperative with our policy of creating a virtuous economic cycle," Mr Amari told reporters on Tuesday.

Tabloid newspaper Nikkan Gendai compared Mr Amari's comments to the aggressive tactics of Japan's notorious yakuza gangsters.

On Thursday, the trade minister said his office would publish the outcome of the labour talks known as Shunto, or "spring offensive", detailing which members of corporate Japan heeded the wage-hike call from Prime Minister Shinzo Abe.

"The ministry plans to conduct a survey on the leading 1,800 companies about this year's Shunto talks and disclose the results at latest by May," Mr Toshimitsu Motegi, who heads the ministry of economy, trade and industry, told a parliamentary committee.

Mr Abe's rare appeal came as he tries to kickstart the world's third-largest economy, which has suffered from years of crippling deflation.

His growth blitz, dubbed Abenomics, is aimed at reversing falling prices and recent data suggest Tokyo is making headway in stoking lasting inflation, which would mean higher prices.

Consumers are also getting set for a sales tax rise to 8.0 per cent next month, up from 5.0 per cent. The move is seen as crucial to shrinking Japan's massive national debt, but there are fears it could weigh on consumer spending and slow growth.

Wage rises - a rarity in a country beset by falling prices - are seen as key to making Mr Abe's plan to grow the economy work.

Japan's car sector was a key target, with all eyes on the world's biggest automaker Toyota which - along with other exporters - posted big profits on the back of sharply weaker yen since Mr Abe swept to power in late 2012.

On Wednesday, Toyota said it would raise employees' pay by an average of 2,700 yen (S$33) a month, while they would also get an average bonus worth about 6.8 months of their base wage - a common pay structure in Japan.

Other firms including Nissan, Panasonic, Hitachi and Toshiba also announced pay hikes.

The focus would now shift from blue-chip firms to see if small and mid-sized companies, which employ the bulk of Japanese workers, follow the lead on pay.

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