Japan July real wages rise 2.4%, biggest gain since 2021

Japanese workers just got their fattest real pay raise in over five years. Real wages climbed 2.4% year-on-year in July, the strongest increase since May 2021 and the seventh straight month of gains, according to data from the Ministry of Health, Labour and Welfare. The numbers behind the breakout Nominal cash earnings surged 4.7% to ¥436,401, roughly $2,800. That’s the most significant rise since January 1997, a time when Japan’s economy was still riding the tail end of its pre-Asian financial crisis momentum. Base pay, the bedrock of worker compensation, grew 4.1%. That pace hasn’t been seen since April 1992. Special payments and bonuses added further fuel, jumping 6.3% as companies flush with strong corporate earnings competed for talent in a tightening labor market. The results beat analyst expectations. June had already posted a revised 2.2% real wage gain and 4.0% nominal earnings growth, so July’s acceleration shows the trend is strengthening rather than plateauing. This also marks the sixth straight month where nominal wage growth exceeded 3%. Inflation, the other half of the real wage equation, rose to 2.2%. That’s the first time it breached the 2.0% mark this year. But co...