- Review of Working Hours Regulations
- Labor Mobility
- Council on Economic and Fiscal Policy
- Review of Special Tax Measures
- 2026 Spring Labor-Management Negotiations
- Foreign Resident Policy
- Investment in the United States
Review of Working Hours Regulations
I would like to address recent media reports suggesting that Keidanren has withdrawn its proposal for "Desire-to-Work Reform."
The stable securing of resources through improved labor productivity is essential to further establish the strong momentum for wage increases. As part of these efforts, Keidanren's position remains unchanged. We aim to bring about more flexible and autonomous work styles that align with workers' intentions and preferences, while maintaining worker health and upholding limits on overtime work as fundamental premises.
In the Keidanren's 2026 Report of the Special Committee on Management and Labor Policy, scheduled for publication next January, we will firmly articulate the need for reforms including a review of working hours legislation, centered on expanding the discretionary work system, and will continue working toward their implementation.
(In response to a question regarding Prime Minister Takaichi's directive to the Minister of Health, Labour and Welfare to review working hours regulations) I believe Prime Minister Takaichi's directive for examination is timely. I understand that amid growing need in recent years for flexible work styles suited to individual workers, the direction is to review working hours regulations on the premise of maintaining physical and mental health and worker choice.
While current caps on overtime work should be maintained, the problem is that they are applied uniformly, including to those who work autonomously. In particular, I have high expectations for a review of occupations and job descriptions covered by the discretionary work system, and I believe it is important that this will encourage workers to fully exercise their abilities and further stimulate their desire for growth.
With Japan's potential growth rate at a low level of around 0.5 percent, labor supply is a constraint on raising it to the 1 percent range. I believe that revising working hours legislation to make it more flexible and autonomous will lead to advancing our growth strategy.
(In response to a question regarding whether Prime Minister Takaichi's statement at the Diet to the effect that taking on side jobs to compensate for reduced overtime pay resulting from work style reforms could harm health indicates that Japanese wages are low) Keidanren has been working on sustaining and establishing momentum for wage increases with an awareness of the problem that wages in macro statistics have not risen for a long time. We are not aiming for a scenario where relaxing working hours regulations leads to increased overtime pay and improved living standards. We will continue to forge ahead with further establishing the momentum for wage increases.
Keidanren has been positively promoting side and concurrent employment as contributors to productivity improvement and innovation creation, considering them meaningful as part of stimulating growth motivation and self-realization.
Labor Mobility
As part of labor reform, one of Keidanren's key policies, we released today an Action Plan for Realizing the Active Promotion of Labor Mobility.
In FUTURE DESIGN 2040, we set forth as one of the visions for 2040 that through promotion and establishment of smooth labor mobility, Japan's labor productivity will rank among the top tier of developed nations, resulting in a virtuous cycle in which total wages increase steadily and, premised on moderate price increases, real wages and personal income trend positively.
However, while labor mobility in Japan has become more active than before, particularly among younger generations, it is not sufficiently advanced compared to other countries.
Therefore, this action plan categorizes the necessary elements for promoting labor mobility into actions for companies and the business community, requests to the government, and matters for collaboration with educational institutions, and presents their respective priorities, specific measures, and actions with a three-year outlook.
Going forward, Keidanren will incorporate this action plan into our 2026 Report of the Special Committee on Management and Labor Policy and implement its recommendations through relevant committees to actively advance labor mobility.
(In response to a question regarding evidence that active promotion of labor mobility leads to structural wage increases and ultimately productivity improvements) While I am not aware of specific data, it is important to create a society where changing workplaces to enhance one's own value becomes a motivation, resulting in increased value and rising wages. The objective is not to shorten average years of service. Rather, the direction we should aim for is improving productivity by having workers enhance their own value through labor mobility and increase their compensation.
Council on Economic and Fiscal Policy
(In response to a question regarding the chairman's resolve about the Council on Economic and Fiscal Policy, to which he has been appointed as a private-sector member) The Council on Economic and Fiscal Policy is an extremely important venue for discussing the government's basic policies on economic and fiscal management. I am honored to have been appointed by Prime Minister Takaichi. As before, while emphasizing a medium- to long-term perspective and an overall Japan perspective, and taking into account the Prime Minister's concept of responsible and proactive fiscal policy, I will strive to actively voice my opinions.
I understand the concept of responsible and proactive fiscal policy to mean not mere handouts but rather the government making strategic investments toward strengthening supply capacity, which is a challenge for the Japanese economy, and using that as a catalyst to build a strong economy through public-private partnerships. The Prime Minister has also repeatedly conveyed the importance of fiscal consolidation and the need to ensure fiscal sustainability. Based on this set of considerations, we will engage in discussions at the Council.
(In response to a question regarding Prime Minister Takaichi's statement that the primary balance surplus for national and local governments should be confirmed over multiple years rather than a single year and that the goal is to reduce the debt-to-GDP ratio) The Prime Minister is very boldly putting forward growth investments. Executing investments and evaluating them should be done on a medium- to long-term timescale. I understand that the Prime Minister has stated that she is considering verifying the balance on a multi-year basis to develop policies for increasing the growth rate within a medium-term timeframe.
On the other hand, she has also emphasized the importance of fiscal consolidation. I recognize that she has clearly set forth the direction of reducing the debt-to-GDP ratio and that she is aiming to secure market confidence. In terms of securing market confidence, the single-year primary balance surplus target remains important. Meanwhile, in considering growth investments, Keidanren has long advocated for budgeting based on multi-year plans. We should simultaneously aim for fiscal consolidation in the medium to long term, and the approach of pursuing fiscal consolidation over a period of several years is rational.
(In response to a question regarding the degree of importance of the single-year primary balance surplus target) A multifaceted approach to setting indicators is necessary. It is true that markets observe single-year indicators, and the single-year primary balance surplus target can be positioned as one element within a multifaceted set of indicators. Meanwhile, as the Takaichi administration advocates policies promoting growth investment, the view that fiscal consolidation also requires medium- to long-term thinking is rational.
Review of Special Tax Measures
(In response to a question regarding the consideration of reviewing special tax measures as an alternative revenue source for abolishing the former provisional gasoline tax rate) While reviewing special tax measures requires prioritization based on policy effects, it is important to develop a tax system that is comparable to other countries from an international competitiveness perspective, in terms of creating a level playing field for competition.
In particular, tax incentives for research and development are essential for becoming the science and technology powerhouse that Keidanren envisions, and they need to be examined from the perspective of contributing to strengthening locational competitiveness and promoting domestic research and development investment. Additionally, compared to research and development tax systems in other countries, Japan is at a disadvantage in terms of deduction rates and deduction limits. These factors must be taken into account when considering how to review special tax measures.
(In response to a question regarding the necessity of the wage increase promotion tax system, which is one of the special taxation measures) Over the past three years or so, momentum for wage increases has become very strong, and high wage increase rates have been achieved. I believe the existence of the wage increase promotion tax system has contributed to some degree to achieving recent wage increases. Any review of this tax system must also take international competitiveness into account.
At the same time, with an eye toward further establishing the strong momentum for wage increases and in keeping with the fundamental purpose of raising wages, Keidanren will continue to call on companies to make efforts to increase wage voluntarily.
2026 Spring Labor-Management Negotiations
(In response to a question regarding the chairman's views on Rengo presenting wage increase rate targets of 5 percent or more overall and 6 percent or more for small and medium-sized enterprises in its 2026 Spring Struggle basic policy, the same level as this year) I recognize that Rengo has put this forward based on the thinking of maintaining and strengthening the momentum for wage increases thus far.
Keidanren has positioned 2023 as the starting point year for strong momentum for wage increases, 2024 as the acceleration year, and 2025 as the establishment year. For next year's spring labor-management negotiations, we will strongly emphasize the policy of further establishment. We recognize this as the social responsibility of Keidanren and companies, and we want to call for it. While there are uncertain elements such as US tariff measures, we will approach the negotiations with a strong desire to further establish the strong momentum, taking into account the persistently high prices.
Achievement of the goals Keidanren has set forth should be judged based on medium-term trends and developments. One possible benchmark for achieving further establishment might be the continued implementation of base pay increases by many companies over multiple years.
Foreign Resident Policy
(In response to a question regarding the future direction of migration policy) I would like to commend Prime Minister Takaichi for strengthening the government's coordinating function regarding migration policy. This was a major point of debate in the recent House of Councillors election and the Liberal Democratic Party presidential election. Japan's migration policy is at a turning point, and the need to establish appropriate foreign national policy is growing.
Migration policy requires orderly acceptance of foreign nationals that is sufficiently controlled in both quality and quantity, based on evidence. At the same time, it is also important to promote settlement in local communities after acceptance. I hope for even stronger political leadership to foster sound public understanding.
(In response to a question regarding caps on foreign national acceptance reportedly being considered by Prime Minister Takaichi) I understand that the government will thoroughly discuss the nature of acceptance regulations, including whether to limit them to regulating some foreign residents who do not follow the rules or to impose numerical caps on acceptance.
Regarding appropriate migration policy, Keidanren will also examine the matter based on committee discussions and make necessary recommendations.Investment in the United States
(In response to a question regarding the fact sheet released during US President Trump's visit to Japan, and the possibility that massive investments are becoming fait accompli without clear agreement) I understand that the fact sheet lists projects in fields such as energy and AI infrastructure in which Japanese and US companies have shown interest. What is important is that projects are structured beneficially for both Japan and the United States. I hope that the beneficial nature of these projects will be ensured through communication not only between Japan and the US but also between Japan's public and private sectors.