Companies are responding by raising wages as Japanese companies are avoiding promotions due to widespread perception that they lack compensation for responsibility. According to the Nihon Keizai Shimbun, Japan Airlines plans to raise its managerial salary by about 30 percent from the current level to 16 million to 25 million yen by 2027. The upper limit of 25 million yen is equivalent to the basic remuneration of some executives.
JAL has already started raising overall management wages since 2026. The managerial level has been raised by up to 15 percent and the managerial level has been raised by up to 10 percent, while a separate monthly allowance of 100,000 yen is paid to the manager in charge of the core project. In addition to the simple salary increase, the company has also strengthened its performance-oriented compensation system.
Structural manpower problems lie behind this policy change. As the supply of new manpower decreased due to the low birth rate, competition among companies for hiring intensified, and as a result, wages for starting wages and young people rose rapidly. On the other hand, with the total amount of labor costs limited, wages for the middle-aged and veteran groups were relatively stagnant or decreased.
These flows are also confirmed in real statistics. According to data from Japan’s Ministry of Health, Labor and Welfare, the wage growth rate between 2020 and 2025 was about 15% for those in their 20s and 10-12% for those in their 30s, while only 5-8% for those in their 40s and early 50s decreased. In a survey by the Japanese Federation of Economic Organizations, 23% of companies said they focused on raising wages on those under the age of 30, but only 1% said they focused on those over the age of 45. As a result, the movement to improve the treatment of middle managers is spreading throughout the industry. Secom raised the managerial allowance by about 30%, and Fukoku Life Insurance raised the managerial salary by 15% on average. Leophales21 also raised the upper limit of remuneration for managers.
However, experts point out that there is a limit to simple wage hikes. They say that if the authority and role of the managerial staff are the same as before, the burden can only increase, so the redesign of the organizational structure and decision-making authority should be carried out in parallel. Nevertheless, it is evaluated that measures to close the compensation gap are meaningful in that it is the first step to ease the perception that “it is a loss if it is promoted.”
SALLY LEE
US ASIA JOURNAL
