Nintendo Co. plans to raise salaries by 10% for current and incoming employees in Japan starting this year, joining other corporate giants hiking wages in an increasingly tight labor market.
Domestic salaries are rising at their fastest pace in decades, complicating efforts by the central bank to keep a lid on inflation. Japanese workers’ nominal wages rose in December at the fastest pace since 1997, an acceleration in gains that’s likely to add fuel to speculation the central bank will tighten its ultra-easy monetary policy after Governor Haruhiko Kuroda steps down in April.
Nintendo President Shuntaro Furukawa announced the hikes even after cutting its full-year forecasts for revenue and earnings, saying the burden on employees is increasing and the move will help strengthen the company’s “hiring power.”
Investors are focusing on the Switch’s sales momentum in the coming fiscal year. Nintendo has sat out a broader rally in tech stocks this year and may remain stuck in the doldrums until it unveils a successor to the iconic gaming console, which has seen sales declining over the past two years. The company expects to end the year with about 18 million consoles sold, down from an earlier 19 million target. –BLOOMBERG