Rengo Sets 6 Percent Wage Target for 2027
Rengo, Japan's largest labor union group, established a 6 percent midpoint target for 2027 wage increases and a medium-term goal of 15 percent by 2030.
The Japanese labor union group Rengo announced an ambitious wage bargaining policy for 2027, establishing a midpoint target for pay increases at 6 percent. The group set a minimum benchmark of 5 percent, signaling that this figure should serve as a floor rather than a target. This policy includes a 4 percent base pay increase.
These targets follow three years of average pay gains exceeding 5 percent, a trend driven by persistent labor shortages. For the first time, Rengo also established a medium-term goal to increase wages by 15 percent by 2030 to improve the international wage rankings of Japan.
Economists suggest that actual settlements will likely remain around 5 percent despite the more assertive stance of the union. The outcome of these negotiations is being closely monitored because wage growth trends may influence the interest-rate path of the Bank of Japan and the risk of a wage-price spiral pushing inflation above the 2 percent target.
