Japanese Prime Minister Kishida spoke at the convention of Japan’s confederation of labor unions.
This is an unusual move for a PM from Kishida's side of the political fence. He's the first PM from the Liberal Democratic Party to speak at the biennial Rengo event since 2007.
Kishida is pushing for wage hikes to outstrip the inflation that is hurting household budgets and weighing on consumption.
- “The economy’s energy comes from pay rises,” Kishida said. “We must make the great wave of pay rises sustainable and spread it to the regions as well as to small and medium-sized businesses.”
The Bank of Japan is keen to see wages rise sustainably, which would help inflation hold at its target level in a sustainable manner.
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Rengo mostly represents full-time salaried workers, whose pay increases haven’t kept pace with inflation. Remuneration for contract and part-time workers has risen faster, albeit from a low base.
The Bank of Japan is watching wage trends closely as a key factor in whether inflation will reach its target level in a sustainable manner. Kishida is facing speculation over whether he’ll call a general election in the coming weeks, even as his support rates languish near their lowest since he took office. Polls show many voters are dissatisfied with measures he’s taken to shield them from price rises. He’s set to announce a fresh economic package by the end of the month.
