Top Japan firms agree 5.58% average pay hike, business lobby says

TOKYO (Reuters) -- Top Japanese companies agreed to wage increases of an average 5.58% at annual labor talks that wrapped up in March, the Keidanren business lobby's preliminary data showed on Monday, representing the heftiest pay rise in 33 years.

The average wage increase at the shunto spring wage talks this year exceeded last year's finalized 3.99% increase and came close to the 5.6% recorded in 1991.

The rising wages reflect Japan's chronic labor shortages, as well as efforts to help employees tackle rising consumer prices.

The annual pay negotiations -- called shunto or spring labor offensive -- are one of the defining features of Japanese business, where relations between labor and management tend to be more collaborative than in some other countries.

The country's largest union group Rengo has said that Japanese companies had agreed to raise pay by 5.17% this year, the biggest rise under comparable data since 2013.

Keidanren's survey covers 244 large companies with 500 employees or more in 22 sectors. The preliminary data was derived from 89 companies in 16 sectors. Final data will be published in late July.