Just weeks into her office, Japan's Prime Minister Sanae Takaichi faces an early challenge in the form of declining real wages that threaten her 'Abenomics' approach to economics.
Real wages fell for a ninth consecutive month in September, labor ministry data released Thursday showed. On an annual basis, they have not risen since 2021, underscoring the strain on household purchasing power.
To be sure, nominal wages are climbing, but inflation has eroded real incomes. September data showed that nominal wages climbed 1.9% year on year, while real wages declined 1.4%.
This comes as Takaichi has pledged to revive the spirit of "Abenomics," a policy championed by the late Shinzo Abe, built on three pillars: ultra-easy monetary policy, aggressive fiscal stimulus, and structural reforms.
Within weeks of taking office, Japan's first woman prime minister reportedly began planning a 13.9 trillion yen ($92.2 billion) spending package to help households cope with rising prices, according to Reuters.
