Jobs may outweigh raises in wage talks

Annual wage talks started Tuesday with the focus on whether to maintain periodic pay hikes or prioritize job security amid the prolonged slump.

In the "shunto" spring labor talks, in which representatives of employers and employees negotiate wages and other labor conditions for the forthcoming fiscal year, Fujio Mitarai, chairman of the Japan Business Federation (Nippon Keidanren), said, "The survival and success of businesses and employment security should be top priority."

Nobuaki Koga, chairman of the Japanese Trade Union Confederation (Rengo), the nation's largest labor union association, emphasized that "we at least want to maintain the wage curve," referring to regular wage hikes based on age or years of service.

Heated debate is expected as the nation's most influential business lobby has already expressed readiness to freeze periodic pay hikes and effectively allow pay cuts, citing the possibility of a double-dip recession.

These are the first labor negotiations since the Democratic Party of Japan took power. Rengo has served as the DPJ's biggest supporter.

Mitarai described the economy as in a "state of unprecedented crisis," and said, "Although labor-management negotiations may prove to be a challenge, we would like to find a point where we can land" a decision by taking into account business conditions and paying capacity.

Koga shared the view over difficulties in the economic conditions and employment but strongly responded to management's wish to freeze pay hikes.

"Periodic pay hikes are a system we have developed through many years and the foundation of trust in the labor-management relationship," he said, adding that if workers worry about pay hikes they won't buy as much, which will only accelerate deflation.