MNI DATA IMPACT: Japan Feb Wages Down But Real Pay Positive

Average wages in Japan fell 0.2% y/y in February, recording a 11th straight drop following a 1.3% fall in January.

Real wages emerged into positive territory, however, for the first time in 12 months, according to preliminary data released Tuesday by the Ministry of Health, Labour and Welfare.

Total monthly average cash earnings per regular employee fell 0.2% y/y to JPY265,972 in February.

In real terms, average wages rose 0.2% y/y in February, the first rise in 12 months following a 0.6% decline in January. Total CPI minus impute rents fell 0.5% y/y in February after falling 0.7% in January.

Base wages, the key to a steady recovery in cash earnings, rose 0.4% y/y after rising 0.2% in January, for the second straight rise.

Overtime pay fell 9.3% y/y in February, widening from -6.6% previously.

The fall was mainly due to a drop in overtime working hours (-9.7% y/y in February vs. -8.0% in January) amid weak economic activity in service businesses impacted by the pandemic.

Bonuses and other special pay fell 1.0% y/y in February for the 10th consecutive monthly fall following January's 20.4% slump.