Economy

Fundamental action required to raise wages

The Yomiuri Shimbun
A curry restaurant announces price increases in August due to high raw material prices and other factors, in Shibuya Ward, Tokyo.

By Tomoki Okamoto / Yomiuri Shimbun Staff Writer

16:15 JST, August 19, 2022

The government should take fundamental action to bring about higher wages, with July’s consumer price index increase exceeding the Bank of Japan’s target of 2% for the fourth consecutive month.

This increase is mainly due to higher energy and food prices, which is different from the positive price increase that would occur when growing demand leads to higher prices and higher wages.

The impact of higher resource prices and a weaker yen is expected to emerge later.

Higher prices are likely to accelerate as price increases are scheduled for many food products beginning in autumn.

Some analysts forecast that the rate of price increases will reach 3%.

With limited wage growth, households are unable to enjoy a real sense of rising wages.

The government’s measures against rising prices so far consist mainly of merely treating the symptoms, such as maintaining the selling price of imported wheat at the same level as before.

The government is required to take fundamental measures to support efforts to increase productivity so that companies can raise wages.