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HOME  > Past issues  > 2007 August 1 - 21  > Productivity increases but wages decrease
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2007 August 1 - 21 [LABOR]

Productivity increases but wages decrease

August 4, 2007
A white paper the Labor Ministry released on August 3 revealed that in the past seven years, an increase in labor productivity has led to not an increase in wages or curtailment of working hours but an increase in the dividends and compensation for company directors as well as an increase in internal reserves.

According to an analysis of this report, in the 1980s, Japan’s productivity increase helped to increase workers’ real wages: Labor productivity increased by 2.8 percent, of which 1.6 percent contributed to an increase in real wages and 0.2 percent to a decrease in working hours.

In 1990s, productivity increases helped to shorten working hours: productivity increased by 1.4 percent, of which 0.2 percent contributed to an increase in real wages and 1.1 percent to a decrease in working hours.

In the 2000s, in contrast, productivity increases contributed to neither an increase in real wages nor curtailment of working hours: productivity has increased by 1.7 percent, of which minus 0.1 percent contributed to an increase in real wages and 0.1 percent to a decrease in working hours.

Prime Minister Abe Shinzo and his Liberal Democratic and Komei Party government are insisting that Japan needs economic growth to narrow the social gaps. This government research, however, shows that workers do not share the fruits of Japan’s recent economic growth.

This research sheds light on the fact that the issues of poverty and social disparities arise from not an insufficiency of economic growth but the large corporations’ policy of refusing to share the fruits of growth with workers.
- Akahata, August 4, 2007
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