— Japan Feb Average Wages Preliminary +0.3 Vs Jan +0.4%
— Japan Feb Avg Base Wages -0.3%, 2nd Drop In Row; Jan -0.5%
— Japan Feb Real Average Wages +0.1% Y/Y Vs Jan +0.2%
— Japan Feb Bonuses, Other Special Pay +31.1% Y/Y Vs Jan +12.0%
— Japan Feb Regular Jobs +0.7% Y/Y, 13th Rise In Row; Jan +0.8%
— Japan 2010 Year-End Bonuses -0.3% Y/Y, 2nd Drop; -9.3% In 2009

TOKYO (MNI) – The total nominal average monthly cash earnings per
regular employee in Japan rose a preliminary 0.3% year on year to
Y264,773 in February, posting the 12th straight y/y rise, data from the
Ministry of Health, Labor and Welfare released on Thursday showed.

A fall in “base” wages, which was caused by a rare
second-consecutive monthly drop in scheduled hours worked, was more than
offset by rises in overtime and special pay, which comprises mostly
seasonal bonuses.

The year-on-year growth in total cash earnings declined slightly
from +0.4% in January. The 1.0% rise in total cash earnings in March
2010 was the first y/y increase in 22 months.

Bonuses and other special pay jumped 31.1% in February, posting the
second consecutive monthly y/y gain, following +12.0% in January.

Meanwhile, overtime pay rose 3.5% on year, following +3.6% in
January, posting the 14 straight y/y gain.

“Base wages” — the key indicator for a recovery — fell 0.3% on
year, showing the second straight monthly y/y drop. The 0.1% gain in
December 2010 was the first rise since April 2008.

Average base wages are scheduled cash earnings at surveyed
companies that employ five or more people.

In inflation adjusted terms, the total average cash earnings marked
the second straight year-on-year rise, up 0.1%, after rising 0.2% in
January.

The real average wages have recovered from the record drop of 5.2%
marked in June 2009.

Overtime hours worked in the manufacturing sector posted the 15
straight year-on-year rise in February, up by 8.2%, after rising 7.4% in
January and posting the record growth of 57.3% in March 2010. Overtime
hours have recovered steadily from the record drop of 48.9% in March
2009.

From the previous month, overtime hours worked in the manufacturing
sector rose 2.5% on a seasonally adjusted basis, posting the fourth
straight m/m rise after growing 4.2% in January.

Overtime hours have been recovering since October 2009, led by the
automobile and electronics sectors. This has pushed up the level of
overtime pay.

Total overtime hours worked for all industries rose 1.0% in
February, after +3.2% in January, showing y/y gains for the 14th
consecutive month. The 4.4% gain in January 2010 was the first
year-on-year rise in 18 months.

Three years of steady job creation until April 2009 were replaced
by job losses or flat employment levels through the end of 2009, but the
latest data indicate a recovery in the labor market.

The number of regular workers rose 0.7% in February after +0.8% in
January, marking the 13th straight y/y rise. The gain in February 2010
was the first y/y rise in 10 months since +0.3% in April 2009.

Cash earnings include overtime and bonuses. Regular employees are
workers on permanent payrolls as well as those with part-time status.

The ministry also said year-end bonuses paid from November 2010 to
January 2011 fell 0.3% from a year earlier, posting the second
consecutive y/y drop, following -9.3% for 2009 and +1.0% for 2008.

By contrast, summer bonuses paid from June to August 2010 rose 1.1%
from a year before, showing the first gain in four years after plunging
9.7% in 2009.

tokyo@marketnews.com
** Market News International Tokyo Newsroom: 81-3-5403-4437 **

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