Japanese bank teller’s starting salary rises by 20%[광화문]

Japan came to the center of the issue again. If improving South Korea-Japan relations over past history is a well-known task in diplomacy, there is also an unknown challenge related to Japan. To be precise, it would be more honest to say that he does not want to publicize the situation in Japan centered on the domestic economy.

The ‘wage hike campaign’ led by the government in Japan is exactly that. Japanese Prime Minister Fumio Kishida asked the business community for an active wage increase, saying in a policy speech at the regular Diet session in January, “We need a wage increase that exceeds inflation.” Japan is experiencing record-high inflation, with consumer prices rising 4.3 percent, the highest in 41 years, in January, but wages have been at a standstill for decades. Prime Minister Kishida emphasized on the 22nd of last month, “We will stimulate consumption and expand domestic demand by promoting structural wage increases.”

The Japanese government, including Prime Minister Kishida, warns that if the rate of wage growth falls short of the rate of inflation, it could fall into stagflation (inflation amid economic recession). It may be called populism ahead of the election (actually, local elections and by-elections to the House of Representatives are held in April), but not only the government but also the candidate for the next governor of the central bank, Kazuo Ueda, Bank of Japan (BOJ), said, “Continue monetary easing and companies will be able to raise wages.” We will create an environment where it is possible.” Japan, which has an inflation rate of 4%, is at this level, but what about Korea, which has a 5-6% inflation rate (6.3% consumer price inflation in July of last year)?

Usually, the government, which is supposed to take the ultimate responsibility for managing prices, is reluctant to raise wages by companies because they can further stimulate high prices. Deputy Prime Minister for Economy and Finance Choo Kyung-ho requested restraint from the management community (June-July of last year), saying that excessive wage hikes could exacerbate the high inflation situation, leading to protests from the labor community and others.

If you look at it this way, it seems that Japan is implementing policies that go against economic principles, but the situation is a bit different. In the case of banking, which is a representative high-paying job in Korea, Mizuho Bank, a large Japanese bank, set a salary increase of 55,000 yen (526,350 won) to 260,000 yen (2,488,200 won) for new employees next year. Mitsui Sumitomo Bank also raised 50,000 yen to 255,000 yen starting this year. The increase this year is also higher, but it is more surprising that until last year, new employees at the bank received around 2 million won per month. It is unusual that the salary was raised by 20 to 25 percent all at once, probably because of the pressure from the prime minister, but it is also worth paying attention to the fact that this kind of salary has continued for about 10 years. Compared to Korea, where the starting salary for new college graduates in the banking sector is roughly between 50 million and 60 million won, this is about half. This is true even considering the situation in Japan, where ‘neither wages nor prices rise’ for a long time. In addition to banks, automobile companies Honda and Toyota, and IT companies Nintendo have also announced plans to raise wages, although the rate of increase is low. Even the retailer Fast Retailing (operator of Uniqlo) announced an unprecedented salary increase of up to 40%.

Japan’s idea is to break income stagnation in the cycle of ‘inflation rise → income stagnation → consumption contraction → economic contraction’, a typical form of stagflation, but the final effect remains to be seen. However, the fact that corporations (mainly large corporations) have ample cash to respond to such policies makes the government less burdened.

There are many legacies following Japan in the domestic economy. The term chuntu (wage bargaining conflict between labor and management around spring), which is used as a synonym for labor-management conflict, was originally from Japan and has faded somewhat now. association) was created. Employment and wage-related systems were often Japanese-style, but at some point (approximately around the time of the IMF financial crisis), the situation changed somewhat as the American-style system was introduced as a global standard.

Korea, which largely accepted the Japanese-style wage system, such as the payroll system and lifelong employment, is now clearly taking a different path from Japan in terms of wages. However, the goal of policy authorities cannot be different when it comes to increasing the amount of money (disposable income) that people can spend. If not, they will have no choice but to distance themselves from the public sentiment, and it will be impossible to obtain a parliamentary majority through elections.

In this situation, unlike Japan’s salary increase, Korea took a different path at the government level by suppressing the price of electricity, gas, and daily necessities (shochu, beer, etc.). If the expectations of the two governments are met through political compromise (resolving past issues, etc.), the two countries will get closer (?), and by the end of the year, economic report cards will be released. Considering the launching process and the trend of approval ratings, which is the right choice between the leaders of the two countries and the government, who are evaluated as not being strong?

[저작권자 @머니투데이, 무단전재 및 재배포 금지]