Japan March real wages down for third month, overtime pay falls
TOKYO (Reuters) -Japanese real wages decreased for a third consecutive month in March against the background of relentless inflation, while overtime salaries fell at the fastest pace in almost a year, government data showed on Friday.
The pay data will add to worries over Japan's growth outlook, alongside tariff threats and uncertainty over monetary policy, ahead of a first-quarter gross domestic product announcement next week. Economists are expecting a contraction.
Inflation-adjusted real wages, a key determinant of households' purchasing power, dropped 2.1% in March from a year earlier following a revised 1.5% fall in February and a 2.8% decline in January, labour ministry data showed.
The consumer inflation rate the ministry uses to calculate real wages, which includes fresh food prices but not rent costs, rose 4.2% year-on-year in March, slightly easing from February's 4.3% gain but still at elevated levels due to rising food costs.
Regular pay, or base salary, grew 1.3% in March, the same pace as in February after a downward revision. But overtime pay fell 1.1%, following February's revised 2.4% growth, indicating a potential softening in business activity.
It marked the first dip in overtime pay since September, and the decrease was the sharpest since April last year.
Total average cash earnings, or nominal pay, increased 2.1% to 308,572 yen ($2,132) in March, which was slower than a revised 2.7% rise in the previous month.
In March, major Japanese firms on average agreed to more than 5% pay hikes during annual spring wage talks, but the effect of such raises typically begins to show up in the government's wage data for April or later.
($1 = 144.7500 yen)
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