Japan’s Real Wages down Every Month in 2025

Reuters

11:50 JST, February 9, 2026

TOKYO, Feb 9 (Reuters) – Japan’s real wages shrank in December for a 12th consecutive month, as nominal pay growth slightly undershot slowing consumer inflation, labor ministry data showed on Monday.

Wage trends are among the most important data factors for the Bank of Japan (BOJ) to decide the next interest hike, after a December hike of 25bp to 0.75%.

Inflation-adjusted real wages, a key gauge of consumer purchasing power, fell 0.1% in December from a year earlier. This extended a contraction that started in January 2025, although the pace of decrease was the slowest since.

Average nominal wages, or total cash earnings, increased 2.4% in December from a year earlier, to stand at 631,986 yen ($4,029), up from revised growth of 1.7% in the previous month.

Regular pay, or base salary, rose 2.2% in December, also picking up pace from revised growth of 1.9% in November. Overtime pay, a barometer of private-sector strength, gained 0.9% in December, slowing slightly from November’s rise of 1.2%.

Special payments, consisting mostly of one-time winter bonuses, rose 2.6% in December, up from November’s revised gain of 1.5%.

Full-year released on Monday showed Japan’s real wages were down 1.3% in 2025, for a fourth year of shrinkage in real annual pay since 2022, when consumer inflation started to overshoot the BOJ’s target of 2%.