Employees' salaries and bonuses in 2018 are estimated to increase by approximately 3.7 trillion
-Record high 56.5% of companies anticipate wage improvement-
The economy in 2017 basically continued to grow, with over 20% of companies saying the economy in 2017 was in a “revival phase” for the first time in four years, and those who said “downturn phase” dropped to the single-digit level ("Survey of Corporate Attitudes towards Economic Outlook for 2018"). Attention has focused on the trends for wage improvement, such as tax reform set forth by the government, including tax incentives for companies that have increased pay, as elements that determine the success or failure of Abenomics.
Under such circumstances, Teikoku Databank has conducted a survey on corporate attitudes towards wage trends for 2018. This survey was conducted in conjunction with the January 2018 TDB Trends Research.
*Survey period: January 18 - January 31, 2018; Companies Surveyed: 23,089; Valid Responses: 10,161 (Response Rate: 44.0%) The survey on wages has been conducted in January every year since January 2006, and this is the 13th survey.
*Details of this survey can be found on the dedicated Economic Trend Survey HP. (http://www.tdb-di.com/)
*Wage improvement means improvement (increase) in wages by across-the-board pay and bonus pay (lump-sum pay) increases, and does not include annual pay raises.
Survey Results (Summary)
1. Companies anticipating wage “improvement” reached a record high at 56.5%, which exceeded that in the previous survey (Anticipation for 2017, conducted in January 2017) by 5.3 points. Companies anticipating no wage improvement remained at 18.4%. Wage improvement is basically in an improving trend.
2. With respect to the details of wage improvement, across-the-board pay and bonus pay (lump-sum pay) marked a record high, at 45.4% (an increase of 5.1 points y-o-y), and 31.8% (an increase of 3.0 points y-o-y), respectively.
3. With respect to the reasons for wage improvement, the percentage citing “stability of and securing the workforce” reached 79.7%, or almost 80%, and increased for four consecutive years. The trend to increase wages for stability and to secure the workforce has strengthened. “Business expansion of one’s own company” (47%) has increased for the first time in five years, and the top five reasons exceeded their last year's levels. With respect to the reasons for no wage improvement, “poor business performance of one’s own company” (55.6%) fell to the 50% level for the first time in four years. While “increase of human investment” remained flat (20.2%), “enhancement of internal reserves” (17.9%) increased for three consecutive years.
4. Total personnel expenses for 2018 are expected to increase by an average of 2.84%. Among these, the total of employees' salaries and bonuses is estimated to increase by approximately 3.7 trillion yen (an average of 2.65%).
1.Research Subjects(Companies Researched 23,089; Valid responses: 10,161 ; Response rate: 44.0%)
*Business Confidence (current, in 3 months, in 6 months, in 1 year)
*Business Conditions (sales, purchasing and selling unit price, inventory, capacity utilization ratio, number of employees, overtime work hours)
3.Research Period and Methodology
Internet-based survey conducted January 18 – 31 2018
The explanation of the Economic Diffusion Index
Research Purpose/Researched Terms
TDB Economic Trend Research (started from May 2002) is a monthly statistical survey conducted for over 20,000 nationwide corporations on their general business activities including the current condition and future outlook of the industry business performance and operating climate. The primary purpose of such a survey is to assess the current state of Japan’s economy.
Selection of the Subject Corporations
Companies of all sizes in all domestic industries are eligible to participate in the survey.
The DI (Diffusion Index) is calculated by attaching a number (in parenthesis in the diagram below) to each of seven possible responses. Then multiplying the percentage of each response by the appropriate number, and adding the results.
A DI over 50 is in the range of “Good.” A score under 50 is “Bad.” The number 50 is the dividing point (“Neither Good or Bad”). All numbers are rounded off to the hundredth. It should be noted that no weight is given to a company’s responses based on its size. Calculations are made according to a “one company, one vote” rule.
For example, all corporations rated ‘Very Good’.
All corporations rated ‘Neither Good nor Bad’.