February 2, 2026

Akahata editorial (excerpts)

In 2025, with the eleventh consecutive month of decline, the average annual real wage decreased by 340,000 yen compared with 12 years ago when former Prime Minister Abe began implementing his economic policy dubbed “Abenomics”. The number of companies that went bankrupt exceeded 10,000 for the first time in 12 years.

Over the past 12 months, large corporations’ dividend payments increased by 2.8 times and the amount of internal reserves that big businesses accumulated thanks to “Abenomics” increased to 561 trillion yen from 333 trillion yen.

Furthermore, 2025 saw a surge in corporate share buybacks aimed at boosting share prices to increase major shareholders’ assets. For the past two years, listed companies spent 33 trillion yen on share repurchases. This amount is equivalent to the total salaries these companies paid to their full-time employees over the same period.

Large corporations have been cutting jobs despite high profits in order to improve their return on equity (ROE). The Tokyo Shoko Research survey in 2025 found that 70% of companies conducting early retirement schemes were in the black.

The portion of corporate value added paid to workers, known as the labor share, in fiscal 2024 was 75.6% for small- and mid-sized enterprises and only 37.4% for large enterprises. While the figure for SMEs remains approximately the same for 12 years, that for large businesses dropped from the 50% level.

The money needed to fund the Japanese Communist Party-proposed across-the-board cut in the consumption tax rate to 5% is 16.3 trillion yen, only 2.9% of the 561 trillion yen amassed in corporate internal reserves. Realizing the sales tax cut and wage hikes that outpace inflation by imposing a fair share of the tax burden on large corporations will help to bolster Japan’s economic growth.