Effect of Japan Wage Increment - Article Example

Japan is the third-largest economy in the world. Being one of the superpower nations, one would expect that the wages offered in Japan are exceptional. This has, however, not been the case for the past decade until recently when Japan’s Prime minister requested an increase in wages by manufacturing and exporting companies in Japan (Tabuchi 1).

The GDP of Japan has had an increased rate of about one percent per annum, which is a very slow rate for a third-best economy state. The move to raise the wages will have an impact overall spending nature of workers, the more the workers have to spend the faster the economy grows. An increase in wages will give a reason for consumers to spend as opposed to the earlier trend where consumers had no need to spend. The increase is a strategy to encourage consumers to let go and spend a little more than they have been in the past. Spending more will eventually lead to an increase in the Nikkei stocks exchange domination.