TOKYO - Japan's real wages in April rose 1.9 percent from a year earlier, increasing for the fourth straight month in the longest positive streak since 2021, as companies offered higher pay to attract and retain talent, government data showed Friday.
Whether the uptrend will continue is under scrutiny as the Middle East conflict disrupts supplies of raw materials, hurting companies and adding inflationary pressure to retail and consumer prices. Separate data showed household spending edged down for the fifth straight month in April.
Nominal wages, or the average monthly cash earnings per worker including base and overtime pay, were up 3.5 percent at 312,425 yen ($1,900), marking three straight months of growth surpassing 3 percent for the first time in more than 34 years, the Ministry of Health, Labor and Welfare said.
The inflation index for the data remained relatively low at 1.5 percent, reflecting the government's subsidy program to curb gasoline prices in response to surging crude oil prices due to the Middle East conflict.
The increase in real wages for the fourth straight month marked the longest positive streak since a seven-month run from February 2021, the data showed. The rise accelerated from an upwardly revised 1.4 percent in March.
During wage talks for the business year from April, many major Japanese companies offered raises that fully met their labor unions' demands, with increases exceeding 5 percent.
According to the latest preliminary tally by the Japanese Trade Union Confederation, the country's largest labor union group, the average wage increase in the 2026 negotiations stood at 5.02 percent.
A survey by the country's largest business lobby Keidanren also showed an average rise of 5.46 percent among major companies.
Uncertainty remains over whether the higher wages will translate into greater private consumption, with the country's household spending in April edging down a real 0.5 percent from a year earlier, separate data showed.
Households of two or more people spent an average of 328,969 yen, the Ministry of Internal Affairs and Communications said, with economists pointing out that consumer sentiment could be weakening amid the Middle East conflict, triggered by U.S.-Israeli attacks on Iran on Feb. 28.
The data is a key indicator of private consumption, which accounts for more than half of the country's gross domestic product.
An internal affairs official said that even though core consumer prices are trending lower, food prices remain elevated, including confectionary such as chocolates and beverages such as fruit and vegetable juices, leading consumers to tighten their purse strings.
By category, spending on food and beverages remained weak amid persistent inflation, dropping 0.6 percent, while expenditure on clothing and shoes declined 10.9 percent on slower demand for business suits for men. Utility bills fell 8.6 percent due to lower use of heating.
On the positive side, the transportation and communications sector gained 7.5 percent, helped by car purchases, likely by consumers who waited for the abolition of a tax at the end of March.
The impact of the Middle East conflict was also reflected in rising purchases of household goods, with buyers appearing to have stocked up on plastic wrap amid fears of shortages and higher prices due to the crisis, the official said.
