Results of 2003 Spring Wage Negotiations

In this year's spring labor-management negotiations, a vast number of large companies indicated that they refused to raise their base wage and instead settled on just offering the standard annual increment. Moreover, the average amounts of the wage settlements of large enterprises remained mostly unchanged in comparison with last year's numbers. This spring's labor-management negotiations can be characterized by the following four attributes:

1. More companies adopted wage-setting systems based on their ability to pay labor costs, abandoning the "follow-the-crowd" practice of setting wages in tune with those of similar firms. The rate of wage increases changed little over last year's figures, which were the lowest ever.

2. Employee payments are being set from the perspective of total labor cost management, with more companies than ever basing their bonuses on their corporate performance. In addition, a larger number of companies have introduced performance-based formula for setting bonus amounts.

3. Some companies have increased wages at a rate smaller than their rate for annual wage increments, suspended or delayed their annual increments, and/or cut their overtime pay rates to the legal minimum for a limited time.

4. More companies are revamping their pay raise and wage-setting systems by shifting emphasis from seniority to performance.