Japan panel recommends 55-yen rise in average minimum wage to 1,176 yen

A government advisory panel in Japan recommended on 28 July 2026 that the country’s average minimum hourly wage rise by 55 yen, or 4.9%, in fiscal 2026. The proposal by the Central Minimum Wages Council, which advises the labour minister, would lift the national average from 1,121 yen to 1,176 yen an hour.

The increase was smaller than the record 63 yen recommended a year earlier. Jiji Press reported that the lower figure reflected a slowdown in inflation compared with the same period of 2025, although prices had continued to rise.

Japan has no single national minimum wage. The council issues guidelines for three groups of prefectures, and local councils then set the actual rates. This time the six prefectures in the top group, which includes Tokyo and Osaka, were given a guideline of 54 yen, while the other 41 received 56 yen. Nippon.com reported that the higher figure for less wealthy regions was intended to narrow regional gaps and ease severe labour shortages there.

Neither side was fully satisfied. Union representatives had sought 75 yen, according to Nippon.com, while employers pointed to the strain on small and medium-sized businesses from instability in the Middle East. The Japan Chamber of Commerce and Industry called the outcome a tough result given what small firms can afford to pay, according to a summary by the Japan Institute for Labour Policy and Training (JILPT), a government-affiliated research body. The trade union confederation Rengo said the rise was not enough to lift the living standards of workers paid close to the minimum, but accepted it as the product of evidence-based discussion.

The decision came as the government of Prime Minister Sanae Takaichi pushed back a target of reaching an average of 1,500 yen, from the end of the 2020s to the first half of the 2030s, Nippon.com reported.