Summer Bonuses on the Increase in Japan, But Depend on Company Size

In a survey conducted by Teikoku Databank on 2024 summer bonuses, 39.5% of companies stated they will make an “increase” in the amount paid this year, up 2.1 percentage points from the previous year. Another 34.2% responded that the amount will remain “unchanged” (down 2.2 points), and 11.3% said there will be a “decrease” (up 2.0 points). In total, 85.0% of companies will pay bonuses, up 1.9 points year on year. In contrast, companies that will not pay bonuses fell by 0.9 points to 10.3%.

While business performances may not have improved, many companies are raising bonuses to reduce employees’ financial burdens caused by rising living costs and as a way to keep them motivated. One information services provider commented that “profits have fallen, but unless we raise wages and bonuses, it will be difficult to retain employees,” while an automobile and auto parts retailer stated that “we are considering increasing bonuses to support employees’ living needs amid sharp price rises.”

The percentage of large companies increasing their bonuses rose by 4.9 points year-on-year to 47.2% and the percentage of small and medium-sized companies by 1.7 points to 38.2%. The percentage for small companies only was approximately 10 points lower than the overall percentage, rising by 1.9 points to 29.2%.

A 2.0% year-on-year increase was seen in the average amount paid per employee, although this was 0.4 points less than the previous year. Large companies raised their bonus amounts on average by 4.1%, up 0.6 points year-on-year. Meanwhile, bonuses at small and medium enterprises only increased by 1.7%, marking a 0.5 point drop and a further indication of disparity based on size.

(Translated from Japanese. Banner photo © Pixta.)