Results of the 2025 Spring Labor-Management Negotiations (Shunto)

 

Overview

What is "Shunto"?
"Shunto" refers to the annual spring wage and labor condition negotiations between labor unions and companies in Japan.

In the 2025 round of Shunto negotiations, the Japan Council of Metalworkers’ Unions (JCM) highlighted three key points:

  1. Record-High Wage Hike Demands:
    JCM decided to demand a base pay increase of at least ¥12,000 per month, surpassing the 2024 demand of "over ¥10,000." This represents the highest demand ever and aims for wage growth that outpaces inflation.

  2. Reducing Wage Gaps Between Large and Small Companies:
    In response to the widening wage disparity between large corporations and small-to-medium enterprises (SMEs), JCM announced a policy to raise real wages across the entire organization, including SMEs. This aims to spread wage increases nationwide and encourage a virtuous economic cycle.

  3. The Importance of Fair Profit Distribution:
    Despite rising corporate profits, labor’s share of income has stagnated. JCM emphasized the need for fair distribution of outcomes, advocating for appropriate profit sharing with workers to support sustainable economic growth and improve living standards.

These initiatives are regarded as crucial steps toward improving workers’ quality of life and fostering sustainable economic growth in Japan.


How Many Japanese Companies Actually Raised Wages?

In the 2025 Shunto negotiations, the percentage of companies that have implemented or plan to implement wage increases is as follows:

  • Overall: About 61.9% of companies expect to raise wages—the first time since 2006 that the figure has exceeded 60%.

  • Large Corporations: A high 92.8% plan wage increases, exceeding the 90% mark.

  • Small and Medium Enterprises (SMEs): 84.6% plan wage increases. While the gap with large firms has narrowed compared to last year, a difference still remains.

These figures indicate that a significant number of companies took part in wage hikes during the 2025 Shunto.


How Do Japan and the U.S. Differ in Profit Sharing with Employees?

🇯🇵 Japan: Emphasis on Stability and Equality


FeatureDetails
💴 Regular Pay Raises & Base Pay Increases (Base-Up)Negotiated every spring through Shunto; pay rises gradually across the board, often seniority-based and premised on long-term employment.
🎁 Bonus System
Typically given twice a year (summer and winter); tied to company performance but often based on fixed months of base pay.

👥 Uniform Across Employees		Profit sharing tends to be distributed equally, regardless of job type or individual performance.
🧱 Preference for Internal Reserves
Companies often retain a portion of profits internally to prepare for economic downturns.


🇺🇸 U.S.: Emphasis on Performance and Individual Evaluation

FeatureDetails
💰 Performance-Based Raises & BonusesRaises and bonuses are usually tied to individual performance; incentive systems are common.

📈 Stock Options/Equity Compensation
Especially in IT and startup sectors, employees receive company shares to benefit from business growth.
🧑‍💻 High Workforce Mobility
With frequent job changes, companies use short-term incentives to maximize employee performance.
📉 Quick Layoffs During Poor Performance

Companies often implement pay cuts or layoffs when business performance declines.



🔍 Summary Comparison

CategoryJapanU.S.
Pay Raise StyleRegular/Seniority-BasedPerformance/Results-Based
Bonus StructureBased on Company AverageBased on Individual Performance
Profit DistributionStability & EqualityEfficiency & Results-Oriented
Risk AllocationMore Internal ReservesMore Active Equity Sharing


What do you think? This introduces a unique aspect of Japanese corporate culture—the base-up wage negotiations.
Which type of system do you find more appealing to work in?

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