RENGO and Keidanren Discuss Wage Increases and Economic Reform in Spring Labour-Management Talks
On January 22, 2025, RENGO (Japanese Trade Union Confederation) and Keidanren (Japan Business Federation) held a discussion in Tokyo on the theme of Various Issues Surrounding the Spring Labour-Management Negotiations.
At the outset, Masakazu Tokura, Chairman of Keidanren, stated, “This year must be the year in which we establish the strong momentum for wage increases that has been cultivated over the past two years. Keidanren, through the dissemination of the 2025 Keidanren Labour-Management Report released yesterday, is fully committed to encouraging deliberations with the aim of base wage increases.” He emphasized, “The establishment of wage increases requires the wage growth of small and medium-sized enterprises, which employ about 70% of the workforce, and fixed-term contract workers, who account for nearly 40%.”
Tokura also pointed out, “We need to ingrain the ideas that wages will rise and that appropriate price pass-through and sales price increases are accepted as societal norms, and work toward breaking free from the deflationary mindset that has persisted for nearly 20 years.” He introduced recent initiatives, stating, “On January 16, representatives of the three major economic organizations issued a joint request to encourage companies to adhere to the principles of the Partnership-Building Declaration and called on non-participating member companies to join.” He further stressed the importance of expanding societal understanding of appropriate price pass-through and sales price increases among many small businesses and consumers.
“Through wage increases, we aim to form a robust middle class and lead Japan’s economy toward a virtuous cycle of growth and distribution. This is a social responsibility for companies,” Tokura asserted, expressing his hope for collaboration with RENGO to establish such societal norms.
In response, RENGO President Tomoko Yoshino said, “Last year we saw the realization of over 5% wage increases for the first time in 33 years, achieving a shift to a stage where wages, prices, and the economy can rise stably. However, the current price hikes are not driven by stable demand-pull factors but by cost-push factors, meaning we are far from a rising tide.” She stressed, “We must avoid halting the wage increase momentum at all costs. This year is about solidifying this new stage, and we must work toward stabilizing wages, prices, and the economy through labour-management cooperation.”
Yoshino highlighted, “For the overall uplift of Japan’s economy, wage increases must ripple through to small and micro businesses, as well as local economies. Realizing proper price pass-through, including labour costs, is key to securing wage resources for small businesses. Keidanren must exercise strong leadership in this area.” She added, “In promoting women’s empowerment, while the proportion of female executives has steadily increased, only 15% are promoted internally, compared to 60% of male executives. We must focus on developing female talent to become corporate leaders.” She also called for the removal of barriers to women’s employment, including the abolition of the spousal tax deduction system and the introduction of a selective dual-surname system, emphasizing the need for continued collaboration with Keidanren.
During the discussion, RENGO raised issues such as raising the minimum wage, ensuring fair trade practices, reforming the social insurance system, and promoting unionization. Keidanren, on the other hand, highlighted the realization of a virtuous cycle of growth and distribution, the importance of maintaining and improving Japan’s GDP, enhancing negotiation power for price pass-through, changing consumer awareness, and the necessity of integrated tax and social security reforms.
In closing remarks, Yoshino stated, “Today’s discussion reaffirmed that labour and management are aligned in their goals. In the 2025 Spring Labour Offensive, RENGO will focus on achieving tangible results, particularly for small and micro businesses in local areas. Additionally, we aim to promote a shift in consumer awareness by emphasizing that products should have fair and appropriate pricing.”
Tokura added, “We must break free from the 30-year deflationary mindset and adapt to a new era with interest rates. Growth cannot be achieved without attention to distribution, and labour and management must collaborate to address disparities and work toward solutions.” With these remarks, the meeting concluded.
The 2025 Spring Labour Offensive has, in effect, commenced with this discussion between RENGO and Keidanren.
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