Inflation-adjusted real wages in Japan fell in May, marking a fifth straight month of decline, raising concerns about consumer spending.
Real wages dropped 1.0% year-on-year in May, following a downwardly revised 1.4% decline in April, labor ministry datat released earlier today showed. Nominal total cash earnings also fell an annual 0.2%, having dropped 0.3% in April.
Regular pay, which accounts for the bulk of monthly wages, fell an annual 0.6% in May, the fifth straight month of decline, according to Reuters.
The sustained slowdown in consumer spending will complicate matters for Japan’s government, which is scheduled to hike sales tax in October this year.
Also, anemic consumer spending leaves the doors open for a deeper economic slowdown due to further escalation of trade tensions, if any, and the resulting weakness in the external demand.
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