 Bonuses traditionally pay for big-ticket purchases |
Summer bonuses are rising for Japanese employees, in a development which spells some much-needed good news for an economy hard-hit by years of deflation. Major Japanese companies pay bonuses twice a year, and the rise - of 4.32% on average, with the car industry up more than 10% - is the first in several years.
A rise in profits as a result of restructuring has enabled the boost, according to Keidanren, Japan's biggest employers' federation.
Consumer spending normally amounts for about two thirds of the Japanese economy.
But ever-rising unemployment, repeated recessions and a steady slide in prices has led to a consumer slowdown which has helped trap the economy in the doldrums.
Out with the old
As well as supplying the biggest rise in bonuses, the car industry could well prove to be one of the biggest beneficiaries.
Traditionally bonuses make up as much as 20% of annual earnings for employees of big companies, and have been used to pay for big-ticket items such as cars and expensive electronic goods.
For years, Japan's rate of turnover of these items was way ahead of that in the US or Western Europe, and a walk down a Tokyo street would show hi-fis and TVs in perfect working order sitting with household trash as they were thrown away in favour of newer models.
But the flagging economy has led to a slackening in bonuses in recent years - with some companies being forced to cut or even suspend them.
One-Minute World News 
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